Each spring, the Upfronts provide an opportunity for TV buyers and sellers to come together — not just to make deals, but to reflect on the state of our industry.
If last year’s Upfronts were haunted by the specter of Hollywood work stoppages, this year’s event provides a glimpse at the new normal of a media landscape ruled by Convergent TV advertising.
With Amazon announcing it will join Netflix and the major TV networks in making its pitch to advertisers in New York City this May, the boundaries between linear and streaming TV have never been more porous. And as digital media outlets like BuzzFeed and Vice continue to erode and implode, an increasingly unified Convergent TV advertising ecosystem is adopting the best aspects of the digital display marketplace that’s now in decline.
With the actors undoubtedly returning to big presentations across the city, this year’s Upfronts serve as a celebration of premium, TV-quality content wherever it lives — and the increasingly data-driven ad ecosystem that fuels it.
As the middle falls out, advertisers find value at both ends of a “dumbbell market.”
As the digital display and non-premium video “middle” continues to deteriorate due to privacy regulation, cookie deprecation, and other industry trends, we’re seeing digital advertising develop into something of a “dumbbell market.” That is, advertisers are increasing their investments in the lively, engaging, targetable, and measurable worlds of Convergent TV and social, but shrinking investment in the undifferentiated middle.
Over the past year, streaming TV has grown quickly in both audience supply and advertiser demand, allowing TV budgets to grow in the face of social advertising’s powerful allure. In fact, a recent forecast from Advertiser Perceptions predicts that annual U.S. ad spend on connected TV will grow 16.2% to $21.5 billion this year. Meanwhile, traditional display and non-TV, non-social video continue to lag.
At the 2024 Upfronts, this dumbbell market will only become more apparent as we celebrate the culmination of a sea change year in streaming TV advertising. Prior to joining the party at this year’s event, Amazon will have spent the past 12 months expanding its ad business by adding new, interactive formats and broadcasting its first ever Black Friday NFL game (next year, they’ll even have a playoff game). And with the introduction of ads into Prime Video, Amazon is instantly one of the scaled players at the high end of this market.
Meanwhile, Netflix has continued to add new live sports programming like the Netflix Cup, even going as far as inking a multi-billion dollar deal to bring WWE’s Monday Night Raw to the platform beginning in 2025. Its ad tier, launched just a year and a half ago, now boasts 23 million monthly active users.
And we can’t forget about YouTube, which has become more formidable than ever with the successful launch of NFL Sunday Ticket and its YouTube Select program for advertisers looking to purchase the platform’s top-tier content. Together, these offerings make YouTube even more viable as a major part of TV advertising budgets.
All this is great news for brands, as the streaming environment creates a highly engaged audience that takes crucial, mid-funnel actions — like brand searches and website visits — that are most predictive of future sales.
Convergent TV is pairing TV’s engaging content with digital’s strength with targeted audiences
One of the most fascinating developments we’re watching at this year’s Upfronts is the way Convergent TV buyers and sellers are increasingly leveraging the data-driven performance strategies and tactics of the now well-worn, waning digital ad market.
Traditionally, linear TV has been viewed as a brand-building medium, one where advertisers focus on reaching large audiences — with limited targeting or tools for determining what those audiences did after seeing the ads.
But in the digital age, modern measurement companies can track the actions target segments of consumers take in the moments after seeing an ad. As a result, marketers can measure ad effectiveness by pinpointing the magic moment when a Convergent TV ad moves a consumer from awareness to intent by driving them to search for the advertiser, visit its website, or download its app.
That’s why I’ve long argued that TV is both a brand and a performance medium, and the lead-up to this year’s Upfronts makes clear that our industry’s key stakeholders are starting to agree. In this new convergent reality, TV is now both a reach and targeting medium as well.
For instance, NBCUniversal is implementing cross-screen, outcomes-based measurement and making some of its Olympics inventory available for programmatic buying. Disney, too, is expanding its programmatic offerings to make it easier for clients to make cross-screen media buys with the precise targeting and performance measurement that has long been available in digital advertising.
As NBCUniversal chairman of global advertising and partnerships Mark Marshall put it in a recent statement, “Television today is a full-funnel performance vehicle where marketers can launch, build and grow their brands across any screen at scale.”
Streaming and linear will continue to converge — at this year’s Upfronts and beyond
Advertisers, networks, and streamers are all moving toward a truly Convergent TV ecosystem, one where brands can make cross-screen media buys with precise targeting tools and measure the true impact of their ads. But for all the news on the horizon at the 2024 Upfronts, the full potential of Convergent TV is just beginning to be unleashed.
Today, most brands have tools to measure audiences in the style of traditional linear TV, and tools to measure outcomes in the style of digital media’s performance marketing. What they’re still missing is an integrated system for measuring audience and outcomes at the same time.
After all, there’s not much value in reaching even a highly specific audience if you’re not effectively moving those viewers down the funnel — and even the most performance-driven marketer has target audiences in mind when they plan their campaigns.
Only once we’ve successfully fused audience and engagement will Convergent TV truly fulfill its promise as a cross-screen, full-funnel medium for brand and performance advertising. Until then, we’ll all have to celebrate our progress with the knowledge that we still have work to do.