”Upfront” is a meeting that occurs before the start of major television ad sales periods. It gets plenty of press, and major advertisers pay attention because the main purpose of Upfront is to sell TV commercial time before new television series begin.
Upfront usually takes place at the end of May, when networks announce their fall prime time schedules and report which existing programs are canceled. Wall Street keeps an eye on Upfront each year, because the sale of approximately three-fourths of ad time for the upcoming TV season gives clues about the TV industry’s economic health. But Upfront may not be ”all that.” Here’s why.
TV Dominates, But That Could Change
Television is still the big league for advertisers, because it still attracts the biggest audience. However, other advertising venues are growing more quickly. Innovative methods of monetizing content have lead some industries to shift ad dollars to digital media, like the movie studios that put trailers online and try to make them go viral.
Today’s television ads often include calls to action that involve people going online, which indicates that monetizing content online is a technique that is gaining strength and gradually eroding some of the television industry’s influence on the ad market. Ad spending patterns are changing, and many industries turn to things other than advertising for monetizing online content, such as premium subscriptions, e-commerce, and custom job boards.
Should Upfront Affect Your Monetization Strategy?
While Upfront is interesting, and can give hints at the general advertising zeitgeist, monetizing content online shouldn’t be driven by what goes on at Upfront. Here are 5 reasons why digital publishers shouldn’t think of Upfront as the tea leaves to be read properly to ensure successful monetization.
SEE ALSO: Content Monetization Trend
1. Upfront Is Heavy on Bluster
Upfront is more hype than buzz. Sure, there’s plenty of hullabaloo about which networks and advertisers have more leverage this year, and who’s going to score the best deals once the negotiating begins. However, once the bartering commences, everything happens fast, and within a few days, it’s all over until next year. The swaggering and posturing are little more than entertainment.
2. Upfront Isn’t That Good a Measure of Media Health
Despite the fact that television advertising still dominates how ad industry dollars are spent, Upfront isn’t a crystal ball that can foretell the health of the entire media industry. It’s more like a bet on where the advertising economy will be several months hence. In fact, Credit Suisse did a study and found there’s only a correlation of about 36% between spending on Upfront ads and the growth of the overall advertising industry.
3. Upfront Doesn’t Predict the Best Way to Sell Ads
Television networks still have the clear advantage in selling ads. At Upfront they ask advertisers to buy ads in shows that haven’t yet aired, in hopes the shows will succeed, and for advertisers, that’s a big gamble. Monetizing content online is different. Site analytics make online ad purchases more informed, plus there are more ways to monetize online content than there are to monetize television content. Premium websites may monetize by requiring subscriptions, the way premium cable channels do. Or they can sell eBooks, have an ecommerce page, offer content sponsorships, or include a white label job board on the site.
4. Television CPMs Differ From Online CPMs
Television ad CPMs represent the cost of an ad reaching 1,000 viewers, and it’s an estimate. Online, it’s possible to count views more accurately. In television, CPMs may rise or fall based on the success of last year’s television shows. Online advertising can be more easily tweaked than television advertising. When you’re monetizing content online, you can get close to real-time analytics that can help you modify your monetization strategy when you need to rather than waiting until next year.
5. Digital Video Advertising Online Is Growing but Small
The so-called ”Newfront” where digital video is monetized through advertising, isn’t nearly as big as Upfront. Digital video advertising isn’t an online mirror of what’s going on with television. Perhaps the blurring of lines between online and broadcast video will someday lead to more relevance between Upfront and Newfront advertising, but that day hasn’t arrived yet.
Figures that come out of Upfront do not represent the actual revenue flowing to the big television networks. Rather, they represent reservations for advertising time on television, and they can be cancelled before the ads ever air. The numbers you read during and after Upfront should be seen as surrogates for how the ad industry views its biggest medium. While it appears as if television’s domination of the advertising market is starting to ebb, online monetization still has a long way to go to rival it. Therefore, when planning for monetizing content, the numbers that come out of Upfront should be taken with a pinch (or more) of salt.
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