“Nimble” and “flexible” have been thrown around frequently by those close to negotiations throughout this year’s upfront, particularly on the buyer side. Budgets have been said to be fluctuating as often as daily to account for economic uncertainty, news of which the first buyer said “seems to get worse and worse.” (Just this week, the U.S. Federal Reserve raised interest rates by 0.75 percentage points, the largest such jump since 1994, in an effort to help curb inflation.)
High-spend clients are unlikely to be so rattled as to yank their TV spend entirely, sources agreed. A second buyer cited Microsoft as having pulled out of the upfronts in years past as well, waving off any implication that the move was indicative of a larger trend in the marketplace.
For its own part, Microsoft said in a statement that it “remains committed to its partnership with McCann, and appreciative of the great work they have done. As we do each year, we are evaluating how to allocate media dollars, but this does not affect our relationship.” McCann is Microsoft’s agency of record. The spokesperson denied that the decision was made to avoid layoffs at the company, adding that Microsoft’s media buying doesn’t directly relate to staffing.
In regard to budgets for marketers that remain in upfront negotiations, nimbleness in the marketplace is also contingent upon the category. Andrea Brimmer, chief marketing and public relations officer at Ally Financial, noted that in the financial services category, “even if we go into an economic downturn, we have a product that fits every element of a downturn—sometimes saving is up, investing down, just depends.” Ally’s media budget is on par with what the company had anticipated spending this year, Brimmer said.
“We are not anticipating pulling anything out of TV or doing anything differently from what we are doing right now,” Brimmer added. “Our strategy is to play a long game. I think for us we can’t have fits and starts from a marketing perspective. When we pull out and go dark it has a big impact on all of our key measures. Collectively as a leadership team, we’ve all made the decision to keep our head down and control what we can control and stay present from a media perspective.”
A second advertising executive noted that most advertisers who enter the upfront have weighed the cost and determined the annual ad haggle to be particularly fruitful for one reason or another.
“Marketers go into the upfront because there is a financial benefit for them to do so,” the executive said. “Either they have established base costs that are so advantageous that if they pull out of the upfront, they would lose them, or they are looking for assets that if they don’t place the money down, it won’t be available in the future. I think that if anything has become clear in the past two years during the pandemic, flexibility has become paramount.”
Contributing: Adrianne Pasquarelli