Upfront 2015: Early Forecast

Originally published April 13 2015 Bottom Line TV networks may still be the engine that drives the marketing train but advertisers are not convinced they need firstclass seats nor are they overly concerned they39ll miss the train if they39re late to the stationThere39s a debate going on among TV buyers and sellers about prospects for the upcoming network TV Upfront season but the overall consensus is a negative outlook MyersBizNet is projecting a more negative outcome than last year when broadcast network TV volume declined 79 and cable network revenue declined 48 These declines were partially offset by double digit growth in the networks39 digital ad revenues Some senior agency executives foresee an overall drop in broadcast network TV spending of as much as 12 and a decline of as much as 6 in network cable spending and possibly more Scroll down for the average estimates of selected advertiser and agency executivesThe investments made by networks in Upfront presentations and parties are just basic table stakes that may prove to be too little and too early The Upfront season seems headed into midJuly unless broadcast networks opt to take share at the expense of unit costs and CPM amp8211 a somewhat unlikely scenario They39re more likely to hold out for higher CPMs and take their chances in the scatter marketCBS Turner Broadcasting Viacom NBCU and Discovery have made meaningful seven figure investments in advanced metrics and data to provide marketers and their agencies with incentives to increase their share of market A few networks notably AMC FX and Hallmark have positive ratings and original content stories that will buoy them in a difficult market Fox has Empire ESPN Turner and NBCU have good sports stories but Fox Sports will take some share NBCU Hispanic and Univision offer attractive options The Weather Channel is depending on its dominant digital presence and geographically addressable opportunities to weather the stormBut even these networks will find strong headwinds as they39re confronted by a perfect storm that is driving down overall ad spending pushing budgets into alternate video options and depressing perunit and costperthousand costs Below are the early forecasts of selected senior agency and advertiser executives who anticipatea smaller share of their network TV budgets moving in this year39s Upfrontmore money moving to alternative video optionsincreased procurementbased pricing pressuresand overall reductions in total ad spending even as the overall economy improvesWhile network executives point to the most new car introductions in years auto execs counter that the majority of TV support for these introductions will go to local and regional television support Many of the fastest growing new companies and categories are marketed almost exclusively through digital media Major marketers are shifting budgets to Facebook Google Twitter and other digital options with Facebook and YouTube aggressively incentivizing advertisers Simulmedia is gaining both acceptance and momentum And print media has awakened as companies like Time Inc Hearst Rodale New York Times and Conde Nast provide quality video content with compelling native content and innovative solutions Digital video OOH offers an expanding array of viable inventory and there is an endless supply of inexpensive lower quality video inventory available through programmatic systemsMyersBizNet Upfront Spending Volumeamp160amp160amp160amp160ActualEstimateamp160201415201516Broadcast Legacy Revenue Volume7998Broadcast Digital Video Revenue Volume240180Cable Legacy Revenue Volume4852Cable Digital Revenue Volume160120All data is based on estimates compiled from multiple sources MyersBizNetamp160amp160amp169Copyright MyersBizNet 2015amp160amp160amp160amp160amp160

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Upfront 2015: Early Forecast

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