"Selling the path to outcomes is a far more involved education than TV sales forces typically provide. TV sales has evolved into a focus on transactions, because there’s been so much to manage on the linear platform." -Andy Sippel, executive vice president, Advertiser Perceptions
Don’t mistake big increases in CPMs this upfront as a measure of long-term health for TV advertising. While the relative decline in premium rating points has sped up negotiations and boosted CPMs this Upfront, revenues are likely to be flat at best.
After sales teams breathe a collective sigh of relief over price increases, managements must confront a critical problem that’s threatening the business altogether. That is, clients aren’t taking full advantage of cross-platform opportunities because they don’t fully understand them. In particular, marketers are unclear on the comparative benefits of advertising on different advanced TV platforms (e.g., Roku vs. OTT vs. addressable), and how they can most profitably add advanced targeting to plans that are linear-based.
As one major advertiser told me last week, “We can only meet our goals with a one-to-one approach across a multitude of platforms. And there’s more confusion than confidence on how to do that.”
TV sales results will increasingly depend on closing this education gap.
Earlier this year, marketers told us that they plan to introduce more products (62%) and support them with higher budgets (60% increasing vs. 21% decreasing). A lot of this money is finding its way to television, starting with actual spending on the Upfront.
But as ratings dip, advertisers and networks alike become more dependent on advanced TV and OTT platforms for premium audiences – viewers who come back reliably and repeatedly to the same content. That’s why CPMs are already rising as much as 40% on some platforms. With political advertisers, DTC brands and Census 2020 lining up to gobble inventory for unprecedented rates, the price should only rise.
Non-linear platforms are critical to fulfilling the promise of outcomes, not just impressions, that nearly every major network made in Upfront presentations. Selling the path to outcomes is a far more involved education than TV sales forces typically provide. TV sales has evolved into a focus on transactions, because there’s been so much to manage on the linear platform.
Reps need to personally educate client-side marketers on how they can profitably navigate the new labyrinth of viewership using their combinations of properties. Specifically, how their audiences fit brand targets, behave across platforms, and ultimately perform for the brand(s). Reps need to learn how to do this from the insights teams – they’re in too short supply to take along everywhere – and go client to client with these tailored insights.
That’s a new set of data and a new selling language for reps that have survived hyping boxcar numbers, programs and talent. The fates of networks depend on it. Those that have been selling cross-channel audience to clients put themselves at a distinct advantage in this Upfront. Those that didn’t need to use this Upfront as a wakeup call to follow suit.
The more reach changes shape and price, the more paramount sophisticated selling becomes. There’s never been more on the line, and clients have never been hungrier for a simpler way to define, access, and account for target-audience scale across a networks’ many platforms. As soon as the ink dries on Upfront deals, sales forces need to raise their game, help clients increase results and get in position for next year, when the outcomes chorus will only get louder.
Advertiser Perceptions is the global leader in research-based business intelligence for the advertising industry.
