During this year’s wild upfront, more advertisers were willing to pay higher prices than last year, contributing to a market that network ad sales executives have called the strongest in memory.
According to a survey by Advertiser Perceptions, 68% of advertisers said they were willing to pay higher prices to lock in video ad opportunities. That’s up 19 points from the more subdued and delayed 2020 upfront.
With rating points down and more viewers cutting the cord, quality inventory was likely to be scarce, creating a fear of missing out among buyers that led to a market that opened and closed quickly, with price increases that topped out in the 20% range on a cost-per-thousand viewers (CPM) basis.
Also: Most Brands Plan To Spend More on CTV: Advertiser Perceptions
“Let’s add another acronym into our advertising lexicon, Upfront FOMO,” said Erin Firneno, VP/business intelligence at Advertiser Perceptions. “Upfront spending rose and outpaced pre-pandemic levels as advertisers were willing to pay higher prices to ensure they would not get closed out of their preferred content. And that preferred content was streaming.”
Advertisers said they committed 54% of their total video budgets upfront this year and streaming connected TV got 37% of upfront spending.
The survey found that 37% of advertisers said CTV was their primary buy.
That turned out to be OK for the big media companies because 65% of advertisers said they prioritized providers that offer video across more channels.
Just 12% of respondents said they made decisions primarily based on the quality of individual programs, while 40% prioritized being able to invest in the broadest set of platforms and channels.
“As audiences redefine prime time and programming, the companies that showcase a wider portfolio at the upfronts have a decided edge,” said Firneno.
Because of the pandemic, upfront presentations have been conducted virtually the past two years. Disney Ad Sales has indicated that for 2022 it plans an in-person event and 84% of the advertisers surveyed said they plan to attend upfront and NewFront events in person.
More advertisers (41%) said they were willing to attend multiple, themed events in 2022 than in last year’s survey (34%).
“CTV is altering the notion of a calendar,” said Firneno. “While advertisers are compelled to buy upfront to secure limited premium inventory, streaming programming does not follow the linear TV calendar. Advertisers may be better served with multiple events throughout the year.”
Advertiser Perceptions interviewed 307 marketer and agency executives who run national TV and digital video advertising in June for this report.
