Can Ad Tech Provide an Alternative to Traditional Upfronts?

The coronavirus crisis has been a nightmare for the 2020 upfronts season, arguably the lynchpin event for the U.S. advertising industry where yearlong deals are thrashed out over the course of weeks. [article_summary section="1"]Media buyers are still reallocating their ad spend following the cancellation of live sports for the foreseeable future. This has upended TV networks’ contingency plans of hosting virtual events in lieu of the usual glamour-filled pitch series beginning in May. Several buyers recently told Adweek it was unlikely they will be able to conduct upfront negotiations in the usual timeframe, which could have an impact on the 2021 TV schedule. Add these woes to adjusted audience behavior in light of cord-cutting, plus the long-term economic uncertainty caused by the coronavirus crisis, and the entire upfront model could be in question. However, away from the glitzy sales pitches, emerging players believe they have found a model that can better assure media owners of revenue while providing buyers with upfront inventory guarantees. These companies believe this can serve as an alternative to how ad placement opportunities are traded in the future. This week, DistroScale, a company that aggregates video ad inventory, announced a deal with NYIAX, a company that facilitates the upfront trading of media budgets by providing buyers with audience guarantees. NYIAX’s marketplace uses ad tech to connect the various tiers of the media sector in order to facilitate earlier agreements between buyers and sellers. Per the company, using its platform means media traders don’t have to commit a year’s worth of budget, or inventory, in a negotiation period that lasts only a matter of days. [article_summary section="2"]The tie-up with DistroScale brings an extra 250 million unique monthly users to the negotiating table. NYIAX plans to make similar announcements in the weeks ahead, with the duo offering contextual and audience packages across the video network. According to the pair, this means of trading helps market participants conduct “upfronts every day.” “The partnership expands the ability of DistroScale's clients to access NYIAX's platform to better plan, buy, execute and manage guaranteed advertising contracts,” said Navdeep Saini, CEO of DistroScale. NYIAX co-founder Carolina Abenante added, “Making their inventory available on NYIAX’s platform provides DistroScale and its publisher partners with incremental revenue opportunities and the ability to strike guaranteed upfront deals with NYIAX’s buyer partners.” Speaking with Adweek ahead of the near-collapse of the 2020 upfront season, media buyers claimed they were prepared to forgo the traditional glamour-fueled pitches in favor of the ability to target fragmented audiences with fewer logistical headaches. [article_summary section="3"]Vin Paolozzi, chief investment officer at IPG’s Kinesso, recently told Adweek that the industry was going through an evolution where advertisers are becoming "more audience-first" and less particular about which screen they encounter them on. Technologies that can help automate the processes of the contractual obligations between advertisers and media owners are a welcome part of this evolution. “It’s the evolution from a real-time world to one that’s more about guaranteed audiences, where you identify the audience that’s most meaningful for your client,” he added. “So, you have to take a different approach about how you secure [ad placements] and get them on a guaranteed basis.” Monique Nelson, chair and CEO of media agency UniWorld Group, added, “A more transparent platform like NYIAX provides solid value to the mixed-media modeling and scenario planning our team conducts to best serve our clients. "More intentional and contextual engagement allows for stronger capturing of all audiences in both traditional and growth audiences," she noted. "The inclusion of a broader swath of [media] markets make the platform more robust.”