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‘Next Year,’ Again, for Digital at Upfronts

While the numbers aren’t all in, it doesn’t look like the digital market for online video advertising made serious inroads into agency spending or changed much in the way of how the networks and agencies do business. Networks and agencies were more interested in the debate over minute-by-minute commercial ratings and DVR view reporting timeframes, and rather than moving away from broadcast and into digital, digital spending came out of direct marketing and other advertising budgets instead.

In a conversation with Mike Cassidy of online ad network Undertone Networks, Christine Merrifield of brand agency MediaVest says she was “a little surprised” about the lack of action on the digital market, considering the online video hype, and suggests that most digital ad spending will instead continue to be done on the scatter market, with individual brands targetting individual shows and their audiences.

One stumbling block could be that while there were many predictions that there would be lots of big ‘integrated’ buys, ad agencies generally have a video sales team and a digital sales team working separately. Complexity is also an issue, as networks move away from promoting digital components as value-adds to tradition buys, but with more original content being produced exclusively for the web, that could still change.

Johnson and Johnson, for one, sat out the upfront entirely but is shifting large amounts of their advertising budget to digital and other new media projects, with up to $250 million, or 20 percent of its total budget, to digital, according to MediaBuyerPlanner. One project is promoting a stealth advertorial film, Innerstate, online.

Whether the total amount of digital spending has doubled over last year, as earlier estimates suggested, is still up in the air. There could be some clarification over the course of the next few days as networks report their quarterly earnings. Turner Broadcasting said that 10 percent of its sales were in digital, which is significantly bigger a share than the estimates of 6 percent of total sales going to digital across the board. Overall, upfront spending rose 3.4 percent to $9.15 billion.

4 Responses to “‘Next Year,’ Again, for Digital at Upfronts”

  1. The move from offline to online for video is a format change more than anything else. Record companies didn’t change their approach to business when they went from LP’s to CD’s. Yeah, the internet changed their world and, belatedly, they changed their ways (a little), but they remain fundamentally the same top down corporate control freaks. The movement online by new enterprises with real money behind them and the ventures by established media outlets (like Turner, for one), show more than ever that old playbooks are still being used. There’s not that much that’s really “new” about TV online. I don’t know if a “cascade” has been shown. At best, nano thin slivers of the pie are being sliced (no wonder so much is tasteless!). This is the beginning of a VERY LONG shakeout that will take a decade or more. As fast as the world moves, long ingrained habits (that are as much cultural as they are mere habits) die a slow death. Big corporations with the largest of ad budgets move cautiously (even though some bray about their avant ways –note the heat that P&G has taken for not being as cutting edge or adventurous as they’ve claimed). The old established corporations are all about preservation of the stock price. Risk takers, they are not. Despite what the self proclaimed digital adverati agencies say, they’re in discovery mode as well (and most still in denial, really). There will be more account hopping than ever as one shop after another gets lucky then has a long cold streak. The line “we’ll make you a viral video” will be replaced with “we’ll see if we can make this go viral” as end clients start to develop a little resistance to the hype.

  2. Wow. It’s hard to figure out why advertisers continue to drag their feet while the hype (and the growing cascade of eyeballs) goes to online video. What will it take? Is it a problem of metrics? Or maybe ad buyers still don’t ‘get’ Internet-based media. Or maybe they just want ‘safer’ bets by sticking with the status quo.

  3. video sales teams and digital teams have to merge for it to take off in my opinion. they have to get everyone on the same page and share the wealth of knowledge that they both had. i’ve been reading a lot more and l have written about how advertisers are changing their pitches to get the big accounts so this is a topic that I find very relevant. keep up the good work.