Usually, the upfronts are equal parts theater and deal-making. This year was definitely a different story. The 2020 upfronts have shown the acceleration of the trend toward data-informed audience-based buying, combined with the unprecedented need for flexibility around both options and cancellation windows. Time will tell what these twin disruptions mean, but in the wake of the 2020 upfronts, we should focus on asking the right questions about the future of our industry.
What’s the product and how is it being transacted?
The upfronts grew out of a linear television model where content was king and it served as the singular proxy for how demographic audiences (e.g., adults 25-54) were reached. Today, content still rules the kingdom, but the audience is now the product.
How did this happen? Over more than a decade, the application of data and technology have combined to unlock the capability to reach both demographic and secondary audience targets (e.g., auto intenders) at scale, across content, regardless of channel or device. That capability overlaps with the declining legacy model, but we’ve long since passed the tipping point.
Today, neither channel nor content needs to be the sole proxy for reaching a desired audience, if you have the necessary data and technology to transact around target audiences.
If there’s a silver lining to Zoom upfronts, it’s this: without glamorous presentations, buyers and sellers can prioritize a new model for reaching target audiences in ways that are agnostic in terms of content as well as how audiences consume that content. In other words, while Zoom upfronts feel like a diminution of tradition, they’re actually a hack that allows us to accelerate the paradigm shift. And once the marketplace fully adopts the new channel and content-agnostic paradigm, buyers and sellers can collaborate to rethink how transactions work.
How do you plan when there are so many unknowns?
Even in “normal” times, upfront planning requires predictive capabilities and access to granular planning data. But these aren’t normal times. According to a June 2020 Nielsen report, time spent consuming digital content increased 215% year-over-year. The same report found Americans watched one billion additional hours of connected TV during March of this year versus last year. But here’s the really shocking thing: even though that data came in last quarter, it already feels out of date because there’s so much uncertainty at this moment.
The questions I think about are: Will those numbers hold over time? If not, when will they change and by how much? What happens now that there is a second wave of lockdowns? What about the content supply? Certainly content has been impacted by production disruptions from weekly TV series to live sports.
Spoiler alert: we don’t know the answers to these questions. But the uncertainty only highlights the value of planning intelligence capabilities. Access to real-time audience viewership data and insight into supply availability are even more important now, because they empower buyers and sellers to make faster decisions. At the same time, dramatic shifts in audience behavior underscore the need to further vet historic ratings models and align them to real-time market conditions.
Ultimately, we’re going to experience fluid market conditions for an indefinite period of time. It will be difficult to predict or model. However, as an industry, we need to recognize the importance of flexibility for us and our partners, so that we can move forward with collaboration and agility.
How do we maximize flexibility?
In order to have win-win outcomes, buyers and sellers need a more flexible upfront reservation paradigm that delivers audiences at scale, across content, devices, and platforms. Shifting to a rolling upfront model creates flexibility by allowing buyers and sellers to transact as close in time as possible to execution.
In this new paradigm, sellers should focus on managing yield by packaging granular cuts of audiences across linear TV, CTV, digital and mobile. By taking a holistic approach to audience packaging, sellers effectively guarantee that the audiences buyers want will be available, regardless of what happens in terms of shifting audience behavior or content supply issues. That’s incredibly valuable, and by emphasizing yield, sellers can capture that value.
On the buy-side, advertisers can maximize flexibility by focusing on audiences everywhere. In this audience-centric approach, advertisers use the intelligence gained from one channel to inform their decisions elsewhere. For example, digital informs linear TV, and vice versa. To accomplish this flexibility, advertisers may have to accept higher CPMs, but they’ll see far less waste in their media plans and less duplication as they pursue incremental reach.
Can buyers and sellers come together in this difficult moment? I think so. The most hopeful sign from the Zoom upfronts is that buyers and sellers are already thinking collaboratively about the future. And they’ll continue to do that important work—on Zoom, Slack, email, and with a little luck, face-to-face in 2021.
