That was the lead sentence of my column this time a year ago. And I've decided to make it the lead sentence of my column every May until the upfront as we know it is dismantled-either permanently, in order to be displayed in a museum, or at least temporarily, to be rebuilt in a way that makes sense.
There are many reasons the upfront is a ridiculous way of doing business in today's sophisticated media marketplace. Scarily, this has been apparent to buyers and sellers for years and yet nothing about the process has changed. A decade ago, executives from P&G, Y&R and J. Walter Thompson argued for "a continuous TV market where advertisers could buy throughout the season," according to consultant Erwin Ephron, who writes again about the annual mating ritual in the Special Report that appears in this issue.
This, however, may be the year when we finally see the beginning of the end of the antiquated upfront-thanks to the soft economy, the rise of integrated marketing and cross-platform packaging, consolidation among media buyers and sellers and the lingering threat of a TV actors strike. Last year, buyers spent a record $8 billion and paid significant cost increases. This year it's a buyer's market and it's likely to be slower and less chaotic. The hope is that the factors that impact this year's upfront will have more than a temporary effect and will initiate more fundamental change.
Even in a down market, the upfront strongly favors sellers, who control how much ad time they will sell and can artificially regulate supply and demand. If demand-and therefore pricing-is weak, they can hold back more ad inventory to sell at higher prices in the scatter market. The frenzied nature of the upfront is also preposterous, with decisions involving billions of dollars made in a series of late-night phone calls and harried negotiations.
The real problem with the upfront is it doesn't jibe with anything else that's happening right now in the media business. Ad agencies and marketers talk about media neutrality and integrated services. The theory is advertisers will no longer blindly employ a model centered on the 30-second TV commercial, but will instead identify from scratch the best tools for solving their marketing challenges. Those could be other media forms, such as magazines, newspapers or billboards, or they could be other disciplines, such as public relations and direct marketing.
In theory, media neutrality leads to a shift in how budgets are allocated. Yet many of the nation's biggest advertisers still participate in a process in which they commit a huge chunk of their budget to one medium a year in advance-long before they even know what kind of business pressures they will face-leaving everyone else to fight over table scraps.
The upfront is also incompatible with the cross-platform packaging media giants such as AOL Time Warner believe will be key to doing business in the years to come. Such deals are enormously complex, especially if they involve more than the bundling of a group of properties sold at a discounted rate. It can take months to pull together major packages, and that thoughtful process doesn't fit with the feeding frenzy that is the upfront. It's also ridiculous to believe marketers need to wait for a defined trigger date to settle such packages. Media sellers should be open for business year-round. Also, as multiyear, multiplatform deals become more commonplace, there will be less money in play when networks announce their schedules for the coming TV season.
The good news for sellers of other media is that cross-media packaging could create something of an upfront effect in their industries, allowing buyers to lock in favorable prices and guaranteed inventory while securing a committed revenue base for sellers. That doesn't have to happen on TV time.
If media neutrality and integrated marketing communications are going to become more than meaningless buzzwords, it's actually past time to abolish the upfront.