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The recent upfronts had lots of big questions swirling around them pertaining to recent mergers, new streaming services and Netflix’s first foray into the annual event. But the loudest questions were about the ongoing Writers Guild of America strike—and the volume has only increased since the upfronts wrapped.
We’re at a point in the year where many agencies and brands usually have an idea of what their upcoming TV plans will look like, but that’s not the case right now. The ongoing WGA strike is having an immediate impact on the TV ad market, slowing down an upfront process that was already going to face economic headwinds. With the studios’ intent to simply ride it out until the writers run out of funds, and with actors now on strike as well, there is a lot of uncertainty swirling around the TV ad market.
Here’s a look at what buyers need to know about the current landscape, and how they can gameplan to execute smart TV buys amid the uncertainty.
The immediate programming impact
To be clear, the strikes are impacting the programming that major brands and agencies are already negotiating around. Disney has recently paused filming on Blade and Thunderbolts, while there’s a long list of streaming series reportedly experiencing production delays, including Stranger Things, Emily in Paris, Hacks, Yellowjackets, Cobra Kai, Unstable, Big Mouth, The Last of Us and Yellowstone. With these large marquee titles pausing production, many shows that were set to premiere in Q4 will now premiere in Q1 2024 or scattered later in the year. Large-scale movies from Disney will even move into 2025.
While the above list is long, it’s a drop in the bucket. Scripted content accounted for 64% of TV and movie content on the major streaming platforms in 2022—nearly two-thirds of all new content for the year.
Networks are building their backup plans and preparing to pivot into different programming—much like when production stopped at the height of the pandemic and networks pivoted into news, reality, game shows and animation to fill airtime. Expect major streamers to lean into programming from other countries as well: Netflix has a successful track record of doing this with shows like Squid Games and Money Heist.
It’s also important to remember that this is happening on the heels of networks already looking into cost-cutting measures. Disney had plans to cut $3 billion in content costs before the writers strike. There are many conversations brewing about how AI could be used to lower content costs right now, and into the future.
With networks and advertisers not knowing where programming will land, upfronts are moving at a slow pace. Granted, with an uncertain economy, the strikes are not the only factor slowing down the process—but at this point, ad buyers should have already seen proposals, and the major holding companies would be close to the finish line by now. Holding companies use the programming slate to project ratings, and the networks use it to project and release costs; general agencies cannot commit with confidence, and advertisers will lean into programming that is set, like live sports.
How to prepare
Every day the strikes continue adds more uncertainty to the scripted programming slate for Q4 and beyond. While this will make for increased competition for some programming, it also creates opportunities for nimble advertisers.
Programming like live sports benefits from the certainty that it will happen as planned, which increases demand: The Super Bowl will have even more importance this year for branding campaigns, and for performance too. Advertisers should anticipate increasing pricing across all sports and lock in buys as far in advance as possible. This goes beyond marquee sports and includes the NHL, skiing, snowboarding and figure skating that will air in the winter months.
Brands should also lock in programming that is completed and set to premiere in the fourth quarter, doing so via locked-in buys and sponsorships. This includes the holiday time period and the annual events that will not be affected, including Hallmark movies, New Year’s Eve specials and other festive fare. Increased demand means these programs will get booked up faster, and slow-moving advertisers will miss out.
Advertisers trying to plan their Q4 TV buys should also anticipate eleventh-hour programming changes like news specials, reruns and compilations. This creates an advantage for advertisers who are able to move quickly, as last-minute replacement programming often results in fire sales. Advertisers should maintain incremental budgets that they can deploy to capitalize on these opportunities.
With so much uncertainty in the TV market, brands and agencies may feel the impulse to reroute their money to other channels, with social possibly feeling like the best fit. However, many brands have already hit a saturation point in social, where the cost per acquisition is simply too high to justify the cost. Performance-oriented brands in particular are better off identifying pockets of opportunity in the TV scatter market.
It’s worth noting that a similar situation played out in the TV ad market just three years ago, when production shut down amid the early days of the pandemic. Audiences still watched TV in vast amounts, and shrewd advertisers were able to reach their audiences by adjusting TV buys rather than redirecting money.
Like the pandemic, things can change day to day as these strikes continue. Stay up to date on the latest news and keep your ears to the ground.
