Upfront 2010

What TV Advertisers Want From the Upfront

Media Buyers' Takes on the Network Pitches: Initiative's Kristian Magel

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NEW YORK (AdAge.com) -- The TV networks are busy putting their best face forward at this week's upfront presentations, trying to convince advertisers that their new schedules are stacked with programs only a fool wouldn't buy. But before the presentations began, Ad Age made the rounds among some prominent media buyers for their takes on the networks' pitches, most interesting shows, the appeal of online video and "event TV."

Kristian Magel
Kristian Magel
Here Kristian Magel, exec VP and director for national broadcast at Interpublic's Initiative, talks about the programming marketers really need most and the changing definition of a "hit" show.

Ad Age: What kinds of video programming are advertisers sorely in need of, and why?

Mr. Magel: The kind that sells product.  We can't make that direct connection for all programming today, but performance-based evaluation is where we're headed. Digital distribution and the web give us new ways of measuring how viewers are receiving and interacting with our clients' advertising. Short term, the goal is to measure which kinds of programs drive the most interaction. Greater interaction indicates higher involvement with the advertising. Long term, we hope to find new ways of linking data, and actions, to real business-driving KPIs [key performance indicators]. That's the dorky answer.  

Ad Age: Are there shows you've heard about that you really want to make it to air?

Mr. Magel: I really want to see "Hawaii Five-0" and "Rockford Files" succeed because they were such great franchises way back when. "Shit My Dad Says" [on CBS] because I love Will Shatner, and "Wilde Kingdom" [on Fox].

Ad Age: How sure are you when you identify a program you want to be associated with that it will be a hit? What's the risk to a brand if the show tanks or is just middling?

Mr. Magel: It's gotten more and more difficult to predict success in the past few years, since the definition of a "hit" has changed dramatically, and a network's ownership stake in a program can influence whether or not it stays on the schedule. Yes, we can measure pre-season buzz, but all that indicates is how the premiere will do. But the risk of a show tanking lies more with the network than the advertiser. Upfront agreements carry with them a lot of conditions to protect the advertiser -- like audience guarantees, so the advertiser will always get the audience they paid for. It's also very clear which programs are considered the "premium" ones -- so when a show like that does poorly, networks are pretty good about re-expressing clients into other premium programs. And if the show is canceled and there is nothing else that fits the bill, the advertiser has the right to take their money back.

If a client puts a lot of resources and money into a major partnership beyond just buying inventory with a new program, and that show doesn't do well, that's a little more risky, but you don't have big successes without taking risks.  And again, there are many ways for us to make sure our clients are not financially exposed in that situation.

Ad Age: How much earlier than in upfronts past are you starting to talk about product/brand integration or devising "hybrid" TV spots that use your product/name as well as the TV property you're sponsoring?

Mr. Magel: Much earlier. A lot of pilots go into script during the winter months -- and are in production in January, February, March -- and if you want to get involved inside the program from the outset, you need to be talking early. You have a little more time on the hybrid campaigns, but those are usually part of multi-faceted partnerships that require an amazing amount of back and forth prior to negotiation; that process can take several months. The execution stage, post-negotiation, can also take many months and a lot of resources from all parties, so we recommend limiting major partnerships to strategic partners. 

Ad Age: When is online video more appropriate than traditional TV and vice versa?

Mr. Magel: We've spent a lot of time collaborating with our digital team on this topic, and we don't see one as more appropriate than the other at all -- they're complementary. Each has unique advantages they bring to the table -- reach, targetability, clutter levels, interactivity, etc. -- but in combination, they are very powerful. How online video is used is really dependent on communication goals:  Some clients see online video as a natural, effective complement to their TV communication and might be more apt to look at TV programming online, while some use it as a targeting and acquisition vehicle, and might be more comfortable with volume players like ad networks, leveraging tools and data to optimize return.  And many are looking at both as part of an overall video strategy -- including TV, online, VOD and place-based.

Ad Age: What's your take on how the scatter market will play out in the fall and winter?

Mr. Magel: That really depends on what happens this upfront.  In the past, following recessionary periods, there has been a huge spike in scatter spending and pricing -- what we're experiencing now. That's usually followed by a larger-than-normal shift of spending upfront, and then a much weaker scatter market, caused by inflated expectations and pricing in the upfront. Essentially, the upfronts following recessions have been overpriced.

But now we have the data and the records to tell us that's how the market has behaved, so we should all be smarter. Our full-year demand projections for 2010-2011 show moderate growth, and we're very confident in those projections. If the upfront goes gangbusters vs. last year -- which was 15% down vs. the previous year -- that doesn't change our long-term view, it just means there won't be much money left over for scatter. So upfront pricing must be designed to recognize a depressed scatter market is coming, and sell-out levels need to be raised so that upfront advertisers maintain their price advantage.

Ad Age: Top sports and even some scripted "events" are getting top dollar. Are these TV moments worth the price, and why?

Mr. Magel: One thing that network TV has proved this past year is that events can still deliver big audiences.  Events like the Super Bowl, the Academy Awards and major series finales all have the unique ability to bring massive amounts of involved, passionate viewers to the set. And today, advertisers have the ability to leverage these events in the period leading up to, during, and after, using a variety of support strategies. The way it works is these big TV events drive instant awareness and curiosity about a brand -- and all these digital venues can be used to capture that demand and extend the brand experience, making the events more powerful than they ever were before. They are also more scarce than ever before, so yes, I think they are more valuable than they have ever been.