Nielsen released figures Thursday suggesting the U.S. TV advertising market is even bigger than projected at more than $72 billion. So the timing was right for Hulu to kick off a series of presentations by digital companies to Madison Avenue — the so called digital upfronts.
These presentations, which run through May 2, are intended to pry away ad dollars from traditional TV incumbents. Vevo, Microsoft, AOL, Yahoo and Disney Interactive are slated to make pitches to advertisers next week.
For Hulu, Megan Hilty, star of NBC’s Broadway-themed drama Smash, was on hand Thursday to serenade the media-agency media buyers in attendance, as the company unveiled further details regarding its ambitious plan to expand into original programming.
For digital companies like Hulu, this is the first time they have gone to the considerable time and expense of arranging elaborate springtime dog-and-pony shows for advertisers. Such talent-laden presentations of upcoming new shows have been a yearly ritual for TV broadcast and cable networks.
They serve as an attempt to woo advertisers right before entering a negotiation period during which the bulk of commercial time for the coming TV season sold.
For its part, Hulu has managed to sieze small quantities of upfront money before. Nearly three years ago, for example, the video streaming company signed a deal worth several million dollars with Publicis Groupe media agency MediaVest, which diverted a small portion of the TV budgets from around half a dozen major brands to target certain demographic segments online.
With Hulu registering $420 million in revenue last year, and the company revealing earlier this week that its Hulu Plus subscription service has now registered 2 million users, Hulu’s goals are far more ambitious.
Certainly, the target is big. Speaking to their own desire to go after TV ad dollars this spring, Yahoo officials described the pot of gold to be worth somewhere around $50 billion. According to data released by research company Nielsen Thursday, however, the U.S. TV ad market was worth $72 billion last year. Meanwhile, even with encroachment by digital companies factored in, ad spending on traditional TV is projected to keep growing this year, with the Big Four broadcast networks expecting cost-per-impression increases of around 8 percent this upfront season.
When it’s time to change …
For its part, Hulu faces an era of transition. Parent companies News Corp./Fox, Comcast/NBCUniversal and Disney/ABC are facing a strategic dilemma in regard to supporting an over-the-top programming business that undermines the traditionally lucrative multi-channel TV model.
With TV networks expected to begin delaying and generally holding back on the shows they supply Hulu in order to support initiatives such as TV Everywhere, Hulu has joined the ranks of digital companies making bold investments into original programming.
On Thursday, Hulu series talent including documentarian Morgan Spurlock, Saturday Night Live player Seth Meyers and Entourage star Adrian Grenier were on hand to glad-handle media buyers, as Hulu showed off some of the following new shows:
– Up To Speed: A Richard Linklater reality series that follows “tour guide, historian and “flaneur ” Timothy “Speed” Levitch as he visits somewhat obscure monuments in American cities, such as the shoe gardens of San Francisco’s Alamo Square. Hulu is targeting a standard broadcast-TV audience of adults 18-49 with this show, which will debut over the summer.
– We Got Next: Kenya Barris, who’s on the writing staff for TBS’ Ice Cube comedy Are We There Yet?, and Danny Leiner, who writes for the NBC comedy The Office, are working on a show about four very different dudes who form an unlikely friendship around their mutual love of pick-up basketball. Hulu is targeting men 18-49 with this show, which is slated to debut later this year.
– The Awesomes: SNL star Meyers spearheads this animated effort about an unassuming superhero, who battles an ever-present paparazzi and a cynical public. Hulu is targeting men 18-49 and the show is slated to debut next year.
– Don’t Quit Your Daydream: Hulu is developing — and looking for sponsorship support — for this series adaptation of Grenier’s documentary featuring famous musicians searching for could-have-been stars and giving them a second chance.
– Flow: Hulu is also developing a scripted urban crime drama created by Michael “Dooma” Wendschuh, the mastermind of EA’s mega-selling Assassin’s Creed gaming series