B&C's 2013 Market Movers

Consensus finds more data—not C7—helps guide their spending plans

The most influential media buyers, the ones who decide how
billions of their clients' ad dollars are spent, say they have more options,
more information and more ways to make sure investments result in upfront sales
this year. The big picture, as far as advertiser demand for broadcast goes, is
unclear, according to six top media buyers surveyed by B&C. It's hard to determine because dollars earmarked for video
could wind up not only in broadcast but with increasingly high-rated cable
shows and digital alternatives whose quality and reach are improving. Buyers
and their clients are more and more comfortable matching their video spend to
consumer-viewing patterns. None of the buyers seemed overly interested in
focusing their buys on C7, the live-plus-seven-days commercial ratings
measurement favored by broadcasters because it includes more delayed viewing.
Instead, buyers are favoring measurement that tells them who is watching their
commercials regardless of whether they're watching in the living room on a flat
screen, in the den on a tablet, or out and about on a mobile device. The
upfront has resisted change for years. By selling $18 billion in inventory
during a few weeks in the spring, the networks put a great deal of pressure on
buyers not to miss the market, which often results in premium pricing. Will
this year be any different? We'll know soon enough. In the meantime, see what
six of the industry's top media buyers are thinking as they prepare for a
week's worth of battle—and months of explaining the outcome to their clients.

0429 MM Buyers Donchin_Andy
0429 MM Buyers Geraci_Chris
0429 MM Buyers Gordon_Todd
0429 MM Buyers Merrifield_Christine
Andy Donchin

Agency: Carat
Title: Director of media investment
Top Clients: General Motors and Macy's
2011 Buying: $4.6 billion*

Chris Geraci

Agency: Omnicom Media Group
Title: President of national broadcast
Top Clients: Apple, General Electric and PepsiCo
2011 Buying: $11.5 billion* 

Todd Gordon

Agency: Mediabrands' MagnaGlobal
Title: Executive VP, U.S. director
Top Clients: Merck, Microsoft and MillerCoors
2011 Buying: $10.2 billion*

Christine Merrifield

Agency: MediaVest
Title: President, video investment and activation
Top Clients: Coca-Cola, Procter & Gamble and Walmart
2011 Buying: $6.3 billion* 

*Source: RECMA (all media; 2011 figures are most recent available)

What is the most important unknown factor in the upfront market this

Chris Geraci: The level of
advertiser demand is always the most important "unknown" going into an upfront
marketplace. This year, there is more complexity around that as we see client
budgets develop in an increasingly platform-agnostic way. So, while the economic
environment will probably support flat-to-modest increases in topline spending,
the question remains, how much will the online video alternatives divert from
the traditional TV and the upfront marketplace?

Todd Gordon: The
biggest unknown factor is how much money will move away from the traditional TV
market as part of a holistic video approach. We recommend that clients take a
holistic approach to their video purchases, where traditional TV continues to
be the core element of the strategy, but reach of light TV viewers is
complemented by participation in online video, cinema, place-based video like
gas stations and health clubs. We expect clients to utilize these in a big way
this year; the question is how much money will shift from traditional TV into
these other areas.

Christine Merrifield:
At MediaVest, we believe consumer experiences exist beyond a single
screen/single device and we will continue to lead the industry in
accountability/research of these impressions while working collaboratively with
our partners in the marketplace. However, the concept of "monetization without
data" as the North Star falls short feels too narrow. The market needs to
develop measurement tools that offer transparency with regard to providing
content and devising transparency for all brands to plan and amplify
appropriately. Following our consumers for the right reasons ...
data-led/ROI-focused, drives our thinking and propels us faster into 21st
century media. And with that, we need to build measurement tools for 24/7 real-time
marketing that has become the status quo for our industry.

John Nitti:
Measurement. In an environment where consumption has truly become
cross-multiple-screens, we are still struggling with measurement and
methodologies to accurately account for total audience. Couple that with the
question "Is multitasking/co-second-screen usage a benefit or hindrance?" A
benefit that can show engagement metrics and deeper immersion in content, or a
hindrance as it is simply a detractor of mind share, further eroding the
ability for a marketer's message to break through-as most of the second-screen
engagement is not tied to the content or the advertising within it.

Amanda Richman:
What's unknown until we're at the table is the degree to which the networks
will truly embrace the opportunities that digital and data provide -- from
expanded scale to cocreation of content-and develop solutions to drive our
clients' businesses forward together. My hope is that we won't be at opposite
sides of the table negotiating only on price, when we should be negotiating
total value.

Lia Silkworth: In
my opinion, it is demand. We have a fairly good sense of supply year over year,
but between fluctuating economic factors, client business results and continued
digital emergence, demand is still the most important unknown factor. For the
multicultural business specifically, given that certain categories and key
advertisers are still inactive, or under-spent, demand remains an important
variable. We continue to see increases year over year and hope that it isn't a
question of if anymore, but when.

0429 MM Buyers Nitti_John
0429 MM Buyers Richman_Amanda
0429 MM Buyers Scanzoni_Rino
0429 MM Buyers Silkworth_Lia
John Nitti

Agency: Zenith
Title: President, activation
Top Clients: General Mills, Toyota and Verizon
2011 Buying: $9 billion*

Amanda Richman

Agency: Starcom
Title: President, video investment and activation
Top Clients: Allstate, Kellogg's and Walgreens
2011 Buying: $8.1 billion*

Rino Scanzoni

Agency: GroupM
Title: Chief Investment Officer
Top Clients: American Express, Ford and Unilever
2011 Buying: $19 billion* 

Lia Silkworth

Agency: Tapestry
Title: Executive VP, managing director
Top Clients: Allstate, Kraft and Kellogg's
2011 Buying: Not Available 

*Source: RECMA (all media; 2011 figures are most recent available)

With broadcast network viewership down and many cable programs winning
their time periods, is your thinking changing about the way you allocate
clients' dollars and the prices you are willing to pay?
: There have never been more relevant/scalable media options
in the marketplace than there are today. We expect to continue our journey of
consumer experience architecture across all channels social, digital, mobile
and linear. Original cable programming has been making a run at prime broadcast
for many years, albeit the past few years it has gained in favor with our
consumers. It should be no surprise to anyone that one day their persistence
would pay off. ... Cable has the momentum, traction and scale that allows for
fluid/seamless options for many marketers. However, I never count broadcasters
out of the mix. Their reach and social command will continue to attract client
budgets, but the question is whether the 2013-14 selling season will be known
as the tipping point. Broadcasters fell too deep and reached too high, and
where "a few hits do not make a network," they may be met with the same
criticism cable programmers received years ago.

Geraci: As an
agency, I feel we have been ahead of the curve on understanding the migration
of viewership toward cable, and that is reflected in our clients' spending
patterns. However, we still spend significantly within broadcast, and I don't
see the proportions changing in any dramatic way this year. There have been some
great success stories in cable over the past year, and also some meaningful

Gordon: We have a
responsibility to seek out value and find our clients' customers across the
video landscape. As viewers have moved from broadcast to cable, and from top
cable networks to emerging ones, and from traditional TV screens to computers
and mobile devices, we follow the customer and reassess value accordingly. And
while many cable networks and original shows are thriving, others are
struggling. TV remains an amazingly powerful medium, but increasingly we are
using more sophisticated data, systems and tools to find our audiences and
build reach across the video landscape.

Nitti: The
audience shift away from broadcast began years ago, and our strategy has been evolving
ever since. We continue to evaluate each program based on our clients'
individual objectives, and the way we allocate their dollars reflects that. Our
view of the market and how we have organized our staff and investment does
require and enable a thorough evaluation of content consumption across all
screens/formats to truly understand where ad-supported supply of professionally
produced content sits. This has [led], and will continue to lead, to either a
reallocation of investment or valuation of cross-channel consumption and

Richman: Chasing
diminishing supply with more dollars is not following the consumer. At Starcom,
we will invest where there is audience growth and the opportunity to engage in
more meaningful ways, subsequently shifting from channel allocation to a more
fluid investment approach.

Silkworth: The
dynamics are different when the marketplace is looked at holistically inclusive
of all networks, English and Spanish. As opposed to English-language broadcast
networks, the largest Spanish-language [broadcast] networks are growing. The
Hispanic cable marketplace also has continued to see new entrants year over
year as well as consistent growth among several players. Price is still
dictated by supply and demand, and the reality is that while growing, the
supply in the Hispanic market still outpaces the demand. As the importance of
the Hispanic market continues to grow and clients seize this important
opportunity, the supply/demand balance may shift.

Is digital creating new opportunities for traditional broadcast and
cable networks or is it generating new competition in the video business?
: Sight, sound and motion continue to be the path to consumer
engagement-innovation, consolidation and newly established business partners are
emerging weekly. Our business has never been about "buying" what's on the page,
but now more than ever we are architecting deal structures for the future where
spot/dots are converted to data/ROI. Digital will create opportunity for those
who choose to embrace transparent data as their friend vs. foe. Did you see the
Twitter deal SMG made on April 22? This is one of the most significant digital
upfront partnerships SMG has ever activated. It reflects the 24/7 marketplace
that the industry is moving towards-and it is a deal for the future. This
multi-year upfront deal is the first of its kind to recognize where markets are
moving to, the first to focus on the value of Twitter plus TV, and in addition
it emphasizes the cocreation of new tools and capabilities.

Geraci: It
creates opportunity in that TV-based media owners still control the vast
majority of high-quality content and now have another distribution platform
upon which to monetize it. On the other hand, there are certainly competitive
forces out there who would like nothing more than to get their hands on a piece
of the TV pie.

Gordon: Mostly, I
believe it is creating new opportunities. Much of the high-quality video
content being sought out by viewers radiates out of the traditional broadcast
and cable TV ecosystem. Consumers love these shows, and they want to watch them
on their own terms, which fuels a lot of digital video consumption. And beyond
video, digital media and social amplification allows traditional TV to work
harder and be more actionable than ever before. The surge in original content
production by digital publishers has become an increasing rival to TV in terms
of the quality of programming being produced, with Netflix and Hulu being
leaders in this area.

Nitti: Yes and
yes. ... It is enabling "traditional" video content providers to capture/follow
the audience consumption of their content and account for it. While digital-video
pure plays grow in scale, they continue to package and channelize their content
to be more "TV"-like, in an effort to lure marketers' "traditional" investments
further into their space. Both the consumer -- and now, more each day --
marketer are viewing video as video, which I think is a good thing for the
overall ecosystem. At the end of the day, the most compelling content will draw
the largest and most valuable audience regardless of consumption point.

Richman: To the
extent that "digital" represents new sources of video supply, yes,
there's competition for networks not only in television, but with their
full-episode player offerings. But traditional broadcast and cable networks are
evolving; they understand that digital is a growth opportunity, social helps
their content get discovered, and mobile devices are making television viewing
more engaging at home. The more we focus on the behaviors that are converging
versus competing, the more positive opportunities we'll realize for our

Silkworth: As multiscreen engagement and viewership
continues to show strong growth for all audiences, and especially multicultural
groups, networks must keep a close eye as to how to capitalize on that growth.
Increasing video streams across screens should be a primary focus for networks
as it expands their ability to capture an ever-growing audience hungry for
content on their own time and on their own choice of screen.

How important are integrations and multiplatform campaigns in deciding
whether to do business with a particular network?

This is all about relevancy, context and execution. We have seen
the entire spectrum of performance in this space and know that while
these efforts can certainly drive money toward a vendor, it can just
as easily drive it away, if commitments aren't met.

Gordon: Every
dollar needs to work hard to deliver client business results. Custom
sponsorships consistently out-perform commercial-only deals by a significant
margin. So these elements are critical to the success of our clients' campaigns
because they drive high-level engagement and attention, and they reinforce key
brand message elements.

Merrifield: We
architect deals in the language that our consumer speak-"Where I want it, when
I want it and on any device I want to experience it on." Often, media
partners with skin in this game are the ones we find ourselves speaking to.

Nitti: It really
depends on the client, but being able to integrate brands into the content of a
show organically, expand the association through a network's digital assets,
offer content that a brand can merchandise through their owned assets and
create a meaningful social dialogue are all important to clients at some level.
Being integrated into content storytelling will become increasingly important
as the ability to avoid traditional ads continues across all formats.

Richman: Clients'
needs are multifaceted; there's a role for networks focusing on efficient
reach, as well as robust multiplatform experiences. However, as programmatic
buying eventually makes its way to the television space, reach alone won't be
enough. Networks that can create content, support our clients' ideas across
platforms and leverage their audiences and assets in meaningful ways will be
best positioned for the future.

Silkworth: The
ability to help ideate and flawlessly execute integration ideas are standard in
today's ad world and can impact degrees of investment. The reality is that not
every client is looking for integrations, but most of them are and the largest
definitely are. Over years, certain network players have become known for
creativity and others for flawless executions, but it is critical that all
networks ensure consistency on both fronts. It is also worth mentioning that
when developing content, networks are no longer the only option; various models
have emerged with endless content and distribution models.

With networks pushing C7 measurement and Nielsen's making multiscreen
numbers available, how will the measurement issue play out in this upfront?
It's really too late at this point to get a
significant number of advertisers on board a C7 metric for this
upfront, and for a certain number of them, full C7 will never be an option for
the entirety of a flight or campaign. Nielsen's online measurement, and an
improved multi-platform assessment will certainly play a role in the
marketplace going forward long-term, regardless of the agreements made in this
year's upfront.

Gordon: This is
all about accountability. Every dollar needs to work harder, and every dollar
is held accountable to deliver against a campaign objective-to make the
register ring. But how can we be truly accountable if we don't have better
estimates of the audience viewing our commercials? Our clients are asking for
accurate measurement of their creative messages across platform on a more
granular basis than ever before. Media owners offering that level of
accountability will see their share of budgets increase.

Nitti: Non-C3
metrics make sense for certain advertisers but certainly not the large
majority, so where they make sense, we are open to having the conversation. The
bigger question is how we are going to be able to accurately measure the
contributions to viewership beyond the linear screen and online video. The
growth in mobile, over-the-top, tablet and VOD are all eating away at C3
numbers, and until we are able to aggregate them all together, we can't paint
the full picture of viewership. Affinity and passion for video content is
stronger than ever, but traditional measurement doesn't tell that story. Nielsen
and ComScore can capture some of this through OCR [online campaign ratings],
XCR [cross-platform campaign ratings] and vCE [validated campaign essentials],
respectively, but we are still lacking with respect to mobile, tablet and set-top
box VOD...we are committed to pushing as an industry and being a part of an
expedient solution.

Measurement and data have always played a role in the upfronts. But this year
in particular it's more acute as big data-in both volume and velocity-becomes
as talked about as big hits. Neither C7 nor Nielsen will be the deciding factor
concerning where the money flows unless networks make it one. What will be more
interesting is where this leads in the years to come as we move beyond average
commercial ratings to brand-specific commercial ratings and real-time data. At
that point, we'll see the upfront truly evolve to support business goals with more

Merrifield: C7
is a pure artificial inflation of supply and a masking of paying more for less.
I see no upside for my clients to jump to a metric in which a few shows see a
bump. The next industry measurement innovation is against ROI, and target
optimization. I see no benefit to C7 for my clients or the industry; we need to
move in collaboration, if monetization of all screens is truly the goal.

Silkworth: It is
a hot topic, but in my opinion not something that is as simple a solution as
moving from C3 to C7. The marketplace has changed since the move to C3: yes,
higher DVR penetration, but also a greater appetite for accountability and
measurement outside of just additional days of DVR viewing. It is also
important to note that not all networks are impacted by time shifting to the
same degree. For example, the largest Spanish-language network, which is often
the solid No. 4 broadcast network regardless of language, is almost DVR-proof.