It's that time of year ... magnolia trees begin to blossom, another Yankees season starts, spring wardrobes come out of hiding and, oh yes, that other annual ritual we passionately refer to as the upfronts takes place.
Over the years, one consistent prediction that never comes to fruition is the end of the upfronts. For as long as anyone can remember, it's been popular sport by the pundits to bemoan the upfronts, complain that it is outdated and irresponsible, and that it needs to be consigned to history to be referenced in an episode on Mad Men.
I'm not writing the upfronts' obituary just yet. Having bought television time in numerous countries, I can report that with few exceptions, no one is happy with the way TV is sold in their respective markets. While the upfront model isn't perfect, there are few alternatives that stand out. That's not to say we can't improve things -- but more of that in moment.
First, a prediction. Despite a falloff in prime-time ratings, a softening automotive advertising market and concerns about the economy, the network upfronts will take in a relatively healthy slug of revenue -- and advertisers are likely to endure increased CPMs. Not the best news to deliver to our clients at this time, but nonetheless an entirely correct one.
Why? First, although television isn't as effective as it was, the WGA strike showed us that even when down, TV wasn't easily substitutable. Weekly magazines got a nice bump, and online seemed to benefit, but clients weren't in a position to make wholesale changes to their strategies. Second, in past recessions, clients' brand advertising has tended to be replaced by tactical campaigns. Television, more than print or out-of-home, is an effective medium to drive response, and so remains an important marketing channel. Third, despite double-digit reductions in the networks' 30-second unit prices, these aren't fully compensating the reduction in audiences.
No question that the industry needs to be doing things differently. But I've got two words to add: baby, bathwater.
There's still a lot that's right about the upfronts. First, the marketplace continues to generate a lot of attention and focus on television. CMOs and creative and media execs make a point of attending the presentations, and the media write stories. Preparation for the upfronts ensures television is factored into companies' marketing calendars early. Importantly, the upfronts also help glamorize the medium, which helps differentiate television sales from the practice of selling other commodities, and keeps buyers focused on content quality and results, not just price. Our European counterparts have made the mistake of becoming too price-focused, and TV's share of budgets is dropping versus the U.S. Branding is about creating connections with consumers, and although television is not the only means to project a brand, it remains an important and controllable one for marketers.
Lastly, the inducements to buy early to commit are a benefit. Advertisers and even creative agencies complain that this forces them to commit to television earlier than they wish but, in truth, no one is being forced to buy early.
So what can change? No question, we need to evolve. In my view, the change needs to be shared by the networks and the agencies.
We think there is a need to go beyond straight audience ratings to evaluate schedules. TV ratings alone seem incredibly outmoded in a market where online viewing and digital program extensions are playing an increasingly prominent role, as is the greater emphasis of a show's appeal and the relationship that this has on advertising receptivity. That's the reason Optimedia introduced Content Power Ratings. This system measures the combined size of TV shows across television, the Web and mobile; as well as aggregating PR coverage, buzz and program quality factors into a single metric.
CPM legacy deals. Certain advertisers enjoy lower CPM deals due to historic reasons. As head of an agency that represents challenger brands and early movers in newer categories, I say these should be eliminated. They are anti-competitive and discourage innovators (i.e., new money) from buying television at a time when this should be incentivized. They also remove an artificial competitive advantage that a lot of our clients must shoulder.
It's time to break down the agency silos. TV networks have shown a lot of leadership in the way they've integrated. The lines between editorial and advertising have blurred as the ability to develop brand integrations has emerged. Digital extensions and cross-media properties of TV shows are increasing the engagement value the networks are able to add to brands. Yet in our view, agencies are not utilizing the full potential of these partnerships. That's because the outdated department structure on both the buying and planning levels hinders us from aggregating these opportunities. I won't say we've cracked this problem entirely at my agency, but we are prioritizing how we bring the various functions under the agency into a more fluid and integrated approach to developing communication strategies.
The upfronts are very much here to stay. We just need to keep challenging the way we work with them.
Antony Young is president of Optimedia International U.S.