”That’s going not to stop business from happening,“ The Media Kitchen’s Barry Lowenthal tells TheWrap
If Jimmy Kimmel isn’t on hand at New York’s Lincoln Center for his annual upfront roast, will ABC still be able to woo ad buyers for its upcoming fall slate?
The coronavirus pandemic has wiped out pretty much any major gathering around the world as countries try to slow the spread of the COVID-19 disease. That reality hit the TV industry this week as all upfront events were called off and in favor of virtual or digital presentations to advertisers of their upcoming season of programming. Media buyers are preparing for what is going to be a very unconventional upfront season.
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But the ramifications of those empty seats at Radio City Musical Hall and Carnegie could be felt well after the world re-starts. We’re going to find out just how important these Hollywood-style, glitzy productions really are.
Brian Weiser, global president, business intelligence for GroupM, told TheWrap that while “there are clearly benefits to these events” their overall importance has waned in recent years. “At the end of the day, the networks and the owners will be able to convey what they need to.” GroupM is the media-buying division of advertising juggernaut WPP, the largest firm in the world whose client roster that includes top brands like Nike, KFC, American Airlines and IKEA.
Barry Lowenthal, CEO of agency The Media Kitchen, was more blunt about the potential impact of not holding in-person upfront events. “None. I don’t think its going to be much of an impact at all,” he said. “That’s not going to stop business from happening.”
On Wednesday, the World Health Organization officially declared the coronavirus a pandemic, one which has sickened more than 142,000 people and killed more than 5,000 around the world. In the U.S., confirmed cases have topped 1,200 people with more than 40 deaths. The past 48 hours have seen a head-spinning barrage of cancellations and postponements of virtually every major event across the entertainment, music and business industries.
For the TV business, this week began with both A+E Networks and AMC Networks scrapping their upfront events that were scheduled for later this month. By Friday, everyone pulled out with many announcing plans to hold their presentations digitally.
A+E Networks began talking about cutting the March 23 event, which was supposed to be held at Jazz at Lincoln Center, two weeks ago before coming to a final decision last Friday. The company, while arguing there still remains a benefit to getting everyone together in one room, believes that this year could lead to a more permanent change in networks’ upfront strategies.
The TV upfronts are a critical event for the business side of the industry, when top advertisers get to see the upcoming slates and fall schedules for the broadcast networks. Cable networks get a chance to give advertisers their outlook for the next 12 months. This is when the bulk of networks’ ad inventory gets earmarked for the coming year and can account for roughly 60-70% of the networks’ total ad inventory.
NBCUniversal said it secured $7 billion in advertising commitments during last year’s upfront sales period, which extends through July. Just last month, the company rolled out its One Platform technology, which rolls up all of its advanced advertising capabilities into a one-stop shop for advertisers and allow buyers to place their clients ads using a variety of audience-targeting methods.
The lack of in-person upfronts isn’t going to lead to a lack of knowledge about what shows the networks have coming up.
“Not much really new ever gets shared at the upfronts,” Lowenthal said. “I don’t think any major advertiser isn’t already going to know what is happening at the upfronts ahead of time.”
Perhaps back in 2004, when NBC was touting its “Friends” spinoff, “Joey” it was more useful to have everyone in the same room. Weiser recalled the tepid reaction from the audience to the show, which was supposed to plug the hole on NBC’s vaunted “Must See” Thursday lineup that “Friends” was leaving. “The very fact was that it was so poorly received was not helpful,” said Weiser, who was in the audience for that year’s presentation. “It gave buyers the sense that, ‘Oh, yeah, this is not going to work.'”
Weiser continued: “You can have that reaction yourself, but it’s when you have that collective response is when it amplifies your perception.”
But now the TV calendar spreads far past the traditional September-to-May TV season, and the influx of streaming services has led to such a fractured viewing environment. Broadcasters use the upfronts to unveil their upcoming fall slates. But what NBC is airing Mondays at 10 p.m. after “The Voice” isn’t as important as it used to be. Advertisers told TheWrap last year the fall schedules were the “least important” part of upfronts.
Media buyers speak with networks year-round now. The value in the upfront these days lies in giving advertisers the ability to see media companies’ strategies in a holistic way and how they feel about the next year. “There are going to be very few properties that you care about to that level of specificity anymore,” Weiser says.
Lowenthal argues that networks can do that without the big dog and pony show. He pointed out that they were already having conversations with media companies, including ones that pulled out of SXSW festival before it was canceled. “We were doing video calls with them. You’re going to see a lot more of that.”
It’s important to note that no actual advertising dollars trade hands during the upfronts; these are just commitments. They don’t take into account, for example, a new fall show that flatlines in the ratings. But an increase or decrease can serve as a bellwether for how Madison Avenue views the health of the traditional television industry.
If the coronavirus pandemic spreads into the next months, that would put production of those TV pilots in jeopardy. On Friday, both Disney and Warner Bros. paused production on their pilots. That would have a far bigger impact on the upfronts than the lack of celebrities glad-handing advertising executives.
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