The echo of Katy Perry’s Thursday morning F-bombs are still reverberating through Madison Square Garden, and already there’s talk of upfront deals getting hashed out as early as this week. Don’t believe a word of it.
Opening The CW’s May 20 upfront presentation, Perry roused a sleep-deprived crowd of media buyers and clients with a whole lot of sass and sparkle, teasing the audience with the rhetorical query, “Is it too early for you to stand on your feet and have some fucking fun?” Advertisers are nothing if not attuned to the power of a well-delivered message, and they responded in kind. And while Perry’s brand of fun knows no timetable, it’s still early to expect buyers and sellers to get down to effin’ business.
“I haven’t seen any budgets yet. Not a one,” said one cable ad sales boss who, not wishing to show his face cards this early in the game, spoke on condition of anonymity. “I know the agencies have most, if not all, in hand…but until I see those numbers, any estimates about where we’ll be when this all wraps up are just enthusiastic guesses.”
Certainly the marketplace will fold its tents well before August, when last year’s upfront ground to a shuddering halt. In fact, sources on both sides of the table suggest that the 2010-11 bazaar will be closed for business by July 4 at the very latest.
“It won’t be done in three days, but it won’t be long and drawn out like last year either,” said one agency executive. “It will probably be finished some time in June.”
Barring some unforeseen spasm in the marketplace’s central nervous system, this year’s upfront should proceed in brisk and tidy fashion, with broadcasters taking their traditional first turn at the trough. “Buyers habitually make broadcast their first stop, and one of the things that keeps the networks so compelling is the relative shortage of impressions,” said Mel Berning, evp, national ad sales, A&E Television Networks, adding that network ratings continued to erode this season. (Per Nielsen C3 data, NBC is the only net to post a gain among the 18-49 demo, boosting its ratings 9 percent through April 25. ABC is down 12 percent, Fox is off 6 percent, CBS dipped 4 percent and The CW was flat among 18-34s.)
Cable sales execs believe the networks will float some aggressively high numbers early on, with CBS shooting the moon with a bid for a 13 percent CPM hike. Realistically, pricing should settle in the neighborhood of high single-digit percentage increases, although CBS hasn’t been shy about saying it will land premiums of 10 percent or more. CBS Corp. chief financial officer Joe Ianniello on May 10 told investors the network “is going to get the pricing we want,” adding that the net will hold back inventory if buyers don’t meet its asking price.
“The bottom line is this: The agencies do not want to come back to their clients and tell them, ‘You know what? You’re going to have to pay double digits to secure your place at the table,’” said one ad sales chief. “If everyone can keep their egos in check, you throw down a 9 or an 8, and this market is going to move like crazy.”
Another player with a whole lot of inventory to offer said the upfront could prove to be a cautionary tale. “What does Gordon Gekko say in Wall Street? ‘Greed is good.’ Well, that might work in the movies, but that kind of thinking will [louse] up the process,” the ad sales exec said.