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Checking In On the 2018 Upfronts

TV and digital advertising has evolved significantly in the past five years, whether we’re talking about viewer consumption habits, publisher content formats or how marketers buy ads. One of the better opportunities to see the changes in action is during “Upfront” and “Newfront” season, a period when publishers make their pitch to advertisers for the rest of the year. After taking a recent look at the Newfronts (for digital publishers), we’re focusing here on the topics that shaped the conversation at the Upfronts, the buying and selling extravaganza for the TV industry. What was everyone talking about this year? Here are three themes to keep mind.

Digital Now Overlaps with TV
The Upfronts were traditionally used by networks and advertisers as an exclusive showcase for TV content. But as digital plays an increasingly important role in ad buying and consumer viewing habits, digital is working its way into the Upfronts as well. CBS, for example, devoted a portion of its upfront event to its streaming video on demand (SVOD) offering, playing up its online-only Star Trek content as a key asset. In addition, there are growing signs that advertisers are trying to cut more ads out of commercial pods in an effort to create a more digital-style viewing experience. One example is Fox’s promotion of “JAZ pods” – the “A” and “Z” in the name refers to the practice of only showing the first and last commercial spots in any given pod.

It’s All About the Numbers
Flashy content and hot new shows have always been an important part of the spectacle that characterizes the TV Upfronts. But this year’s presentations also included a nod to something equally important: data-driven TV advertising. Adweek noted that using data for targeting from first- and third-party sources was a hot topic of discussion at this year’s Upfront events. In fact, according Adweek’s estimates, marketers plan to devote between one and two percent of linear TV ad budgets to spots backed by data-driven audience guarantees in 2018. To put this in perspective, using estimates from eMarketer cited in the piece, upwards of $1 billion in TV ad spending in 2018 will be backed by these new data-driven guarantees.

Everyone’s Still Wrestling with Measurement
Even if there’s no industry-wide consensus about how to do it, a growing majority of Upfront conversations with advertisers focused on the need to measure audiences in more sophisticated ways. It’s not that TV audiences are deserting TV entirely — far from it. Rather, the challenge seems to stem from new TV watching behaviors that advertisers and broadcasters have had difficulties trying to measure. “The audience is there, we’re just simply not measuring them,” said Kevin Reilly, Turner Entertainment Networks chief operating officer, in an interview for The Wrap. “If you want to reach an audience on TV, which still is highly effective, nobody would debate it. What’s not effective is this measurement.” While there’s no single solution to this problem just yet, a variety of ad industry players, including networks and advertisers are working diligently on solutions, many of which were presented during this year’s events. Audience-based targeting is one such example.

Yet another installation of the TV Upfronts are now in the books. But in contrast to decades past, the TV ad sector is in midst of a period of dramatic change. Digital is beginning to overlap and complement TV in many respects, viewing habits are changing, and advertisers are hungry for new methods of targeting and tracking consumers. How will the TV and ad industry solve all these challenges? While the answer is still a work in progress, the promising solutions on display at this year’s Upfronts suggest the answer may be closer than we might think.