Upfronts are always the centerpiece of the TV advertising year. However, between upfronts week in May and the announcements later that summer negotiations are complete, the process has remained secretive, with only a handful of people involved in those high-level talks. Until now: This year, a top TV sales exec agreed to (anonymously) take Adweek behind the scenes, compiling an upfront diary that chronicled each stage of his or her company’s upfront talks. Here’s what this person had to say about how hush-hush early negotiations, Roseanne’s cancellation, “sheer exhaustion” and “a shitload of money” from an unexpected source shaped 2018’s upfront marketplace.
Entry No. 1: Upfronts week still matters
It’s a year-round process, but we really start planning for the upfronts in February. There’s a lot of internal looking at where we are, which clients have changed direction since last May and what we think is going to happen in the marketplace based on institutional knowledge and current marketplace conditions. Then, in the blink of an eye, we find ourselves here at upfronts week in May.
It’s very, very important for us to nail that upfront event, which we think we did. Our team starts working on it in March. The messaging there, and the take-away, is really important. Does it influence a share shift? In some cases, I think it does.
You don’t want to be the one that gets up there and falls flat on their face during upfront week. That would be devastating. As much as everybody rolls their eyes, it really is an important day. If people didn’t want to be there, they don’t have to come, but every year, we don’t have enough tickets.
We just had our event, but for the past month we have already been in very substantive talks with two major agencies. When an agency has their budgets and is ready to go, if they’re inclined to do something before the upfront announcement, they dial our number. So far, those two places are being very reasonable in their asks. I feel like we’ll complete something in the next couple of weeks, if not before.
I am a person who worries about everything, but going into this upfront, I’m feeling really good, specifically about prime. It’s no secret that prime ratings are down across the board. But when the supply is diminished and let’s just say the volume is the same as a year ago—which never really happens; it seems to tweak up every year—then you’re going to see a healthy upfront. We’re going to be positioned very strong in terms of rate of change.
Short of something horrible that we can’t control, I don’t see anything on the horizon that would be a huge roadblock.
Entry No. 2: Pre-Memorial Day homework
The agencies have a lot of heavy lifting to do now. They’re supposed to watch the new shows, come back, do their shares and estimates, evaluate their schedules and start rolling up their clients’ budgets.
People are doing a lot of homework this week, including us. We are in a closed-door meeting this afternoon, with all of our daypart leads and all of the planning people, doing a detailed historical spending track: where are the sweet spots, where are the hot spots, getting everybody on the same page.
We’re spending time engaged in outreach conversations between ourselves and the agency portals. A lot of phone calls are being made at the account exec or manager level to their key client contacts, saying, “What are you seeing on this?” “Do you have roll-ups, do you need us to do anything?”
We don’t like to get anything going in a big way this week because we don’t want our numbers to be “shopped” over Memorial Day weekend—the five major agencies all talk to each other. I’m hoping we get into more of an active marketplace next week.
Meanwhile, Macy’s just left Carat and is going with Spark Foundry. And we heard that both Fiat Chrysler and AmEx are putting their accounts in review. So it will be up to the agencies that currently have the account and up to the client as to whether or not they proceed on the path that has been laid out in planning, or if the client says we’re going to sit this upfront out and we’ll pick it up after the review is done. But this happens every year as we approach the upfront market.
We’re still in heavy-duty prep mode, but if the world came crashing down right after Memorial Day and everyone registers, we’re ready to go.
Entry No. 3: The Roseanne-related ‘freak-out’
So ABC just had a hiccup with Roseanne [which was canceled on May 29, just two weeks after ABC’s upfront presentation, following a racist tweet from star Roseanne Barr]. If that was me—and maybe it is—and you lost the centerpiece of your upfront right after you announced the schedule, I would freak out. If you’re in sales or programming, there’s no way you wouldn’t.
The network absolutely did the right thing, given her comments. But when the centerpiece of your schedule gets ripped out, and you don’t know what you’re putting in its place [editor’s note: ABC ultimately replaced the show on the fall schedule a month later by ordering a Barr-free spinoff of Roseanne, called The Conners], all of a sudden, looking at the share and audience comp estimates you have against that show—and the shows behind it in terms of halo effect—your supply of impressions is going to go down.
You’re not going to put another 15-share show in there; there isn’t one. And when your impressions go down, you immediately tighten up your sell-out, even if you haven’t sold one unit. That means in theory, you’ve got to raise your prices.
Entry No. 4: Gathering steam
Things are moving along at a good and sensible clip. The bigger holding companies are all registered across the board. We’re in good shape and have written business. Last week we were working on a smaller shop, and we closed business with them. They want it to be under the radar and we do, too, because everybody talks.
Last night we got very close to a piece of business and will probably close it late this afternoon. When we get to Fridays, which is today, and nobody’s in a panic, there’s a tendency on everybody’s part across the board that you really don’t want to engage if you haven’t, because you don’t want your numbers hanging out there over the weekend. So if we get this other piece of business done, we’ll probably stay here and do some internal bookkeeping.
I’ve been getting home a little before midnight during the past week, which is typical for us at this point.
We do send our account executives home, unless we know we’re going to close, because we don’t want account executives roaming the hall trying to figure out what management is doing. We do so much of the stuff under the radar, that they don’t get brought into the loop until days after the deal is done.
Entry No. 5: ‘Sheer exhaustion, but in a good way’
I’m losing my voice, though I haven’t yelled much at all. It’s from talking a lot and late nights, because you go home, you’re wound up, you try to go to sleep and then you can’t fall asleep. Then, by the time you get to sleep, it’s time to get up and come back to work. So it’s sheer exhaustion, but in a good way. You’re tired, but you get through it.
We’re in really good shape. The other night, I got home around 2:30-ish and we closed a big agency. And we’ve closed other big agencies.
I’m very happy with what we’re getting in terms of pricing and volume. And I am personally very happy about how orderly and calm it has been: I’m not yelling at the team; we’re all on the same page.
We’re hearing that everybody is seeking double-digits—that doesn’t mean they’re getting them—and so are we. That’s based on competitive numbers we’re getting from agencies—obviously we never believe exact numbers that they give us; we have to figure out what’s real and what isn’t—that we’re all right within spitting range of each other. The agencies all talk to each other, but the networks aren’t allowed to speak to each other, which can be frustrating.
This morning, as soon as I got in, I sat down with my head of planning, and we looked at where we are with money that’s been registered and what’s left to come. We throw a lot of information back into models to make sure we’re OK and that if we have to push back on pricing—meaning push up on pricing—we can tweak quickly as we’re talking to people, and draw a line in the sand.
In the interim, we’re getting phone calls from the people we’ve already closed, saying, “Oh, I forgot to tell you this,” or “When am I going to get a plan for that?” Usually that’s done at the account executive level, but if there’s something urgent or pressing, I’ll get those calls. And in the middle of all of it, we do have television airing now, and we have to make sure that everything’s covered. Plus, there are 100 other projects that we’re working on going forward.
We have to make sure we don’t let anything fall through the cracks. Here’s an example: One agency that we closed had budgets that were over 33 pages. It’s a lot of making sure you’re not screwing up as you’re looking at daypart budgets versus a year ago, and making sure they’re not screwing up as they’re looking at their roll-ups. There’s a lot of housekeeping that you do the day after closing, before you get started on other business.
Entry No. 6: AT&T and Comcast make waves
With the AT&T and Time Warner deal finally closing [on June 14], and Comcast now in a bidding war with Disney over Fox [editor’s note: Comcast officially bowed out on July 19], there’s a lot of noise, but it should absolutely not be affecting the upfront if you’re with one of those companies, which I might be. You need to get the business at hand done, act professionally and move on.
In the back of their heads, maybe those ad sales execs are thinking, “I don’t know if I’m going to have a job, so do I really care?” Well, if you’re a professional, you do care. You want to make the best deal for the place you’re at now, and you’re not projecting out. I don’t see anyone I know throwing caution to the wind and saying, “I don’t care anymore.” Well, I could probably name one person, but I’m not going to!
When something like that happens, I say to my team, “We just have to stay focused.” This certainly hasn’t affected the buy side, the clients.
Entry No. 7: Cannes do
A lot of us were at Cannes [the week of June 18]. If your upfront is not done before Cannes, I do not feel that anybody is in the right frame of mind to try to conduct and close an upfront there. If somebody told you they did, they probably had been drinking a lot of rosé.
I could take all the information I would need to close, let’s make it up, the Magna [Global] upfront, because both [president of North America] David Cohen and [evp of strategic investment] Dani Benowitz were there. But would Dani and David want to do it? No, because everybody’s going at 100 miles an hour, and they don’t have their key stakeholders with them. I think it would be virtually impossible.
I did have some meetings there with high-level people at agencies and clients about pending issues. Did we walk away saying, “Oh, that’s great, we just got another X, Y and Z for the upfront?” No. You walk away and say, “I have a lot of stuff I need to follow up on as soon as I get back to New York.”
Entry No. 8: ‘Basically done’
We are basically done, with the exception of one large holding company. Once that big agency is put to bed, and if they’re willing for us to say we’re done, because I think they know they’re dead-last, we’ll be done. We have out-of-town clients and some smaller agencies here in New York that still have to come down. But we know where we are in the marketplace, and we’re already engaged and having conversations. So we’re hoping to wrap this up very soon.
When we’re this close to getting something done, the holdup could be anything from they haven’t agreed on a rate of change for one particular client to someone saying, “I broke a tooth and I have to run to the dentist.” There’s a lot of reasons, and in this environment, you want to make sure all the T’s are crossed and the I’s are dotted.
Also, budgets change. We could be talking to this one group and then all of a sudden they could find out that they don’t like what they put on hold with another network, and they’re going to bring us more money. Or the client decided that they have to blacklist a show.
Nine out of 10 times, it’s something that is going to get worked through. When people really dig in, it’s about the rate of change. That’s when you don’t want it to get acrimonious or nasty.
Entry No. 9: Crossing the finish line
We had one big agency hanging out there, and we just closed them. There is always a celebration when I can send my note to the boss saying we’re virtually done. Everyone went to our favorite upfront bar, celebrated and exchanged some high-fives.
When we say we’re done, we still have to do some out-of-town and smaller agencies. But they’ve read the press, they know we’re done and that we’re in our marketplace, so they’re not going to have a lot of leverage. We’ll get them done within the next day. It’s not major dollars, but it’s enough dollars by daypart to make a difference.
Also, since we’ve closed with them, some of the agencies have called and want to give us more money, which typically happens. One agency did not buy us for a client, which we knew going in, and that client really wants to be on our broadcast network, so they asked us and the agency to go back and look at it. If it’s a client whose pricing is advantageous toward us on a rate-card basis, we would probably allow those conversations to continue to take place after the upfront, depending on daypart. If it’s a client that, I’ll make this up, has historical CPMs that are lower than our average, we’ll probably say we’re not taking any more money, and a hold is a hold.
You don’t want to be an asshole and say no across the board, and even to the clients that have the deeper discounts, you say you’ll look at it—and maybe you will.
Entry No. 10: Upfront postmortem
Looking back at this year’s upfront, I wouldn’t say there were surprises other than some of the industry news, which was outside our control. One thing we knew was going to happen was the strength in other dayparts in terms of volume versus a year ago. Clients are doing more targeting to efficiently reach the right audience in the right space. They are using their own internal optimizers, and those are going to point you toward the fringe dayparts.
Prime was exactly what we thought it would be. The one surprise is that we got a shitload of money from a big tech company. Those companies are now spending a lot of money on network television. They don’t want people to know that, but there’s an influx of money there—more than the marketplace expected. We’ll see if it sticks.
With the exception of one agency who shall remain unnamed, the portals on the agency side were well-organized and those negotiations went really smoothly. There was no instance where we were worried that somebody was going to walk away and come back the next morning with our budgets cut.
There’s still a lot of upfront-related business to do. If it’s returning business, they haven’t received their plans yet, so now is when the planning group goes into full mode and they still keep long hours to get plans in the system sent to agencies. Where it is new business, those plans have been sent during negotiations.
We also have to present internally to corporate, showing our results. Until that all gets laid out, we don’t know the quarterly dollars and where that is.
So we still have a lot of work to do. It’s not like we’re now off to the beach—no way! And then before you know it, we’ll be back at it again next year.