TV upfront spending expected to decline by 27 percent this year, according to eMarketer
TV upfront ad spending will decline more than 27 percent for the 2020-2021 season due to COVID-19, according to eMarketer.
TV networks are currently out in the marketplace looking to secure ad commitments for next season. During a typical year, at this point the industry would be in the heat of deal making. But progress is expected to be slow as many advertisers hold off on making commitments due uncertainties surrounding the pandemic and ad budgets. There are also still concerns over when TV productions will resume and when live sports will return.
As a result, eMarketer now expects about $7 billion less in upfront ad spending—$14.78 billion in commitments, versus its previous forecast of $21.64 billion.
“Coming into 2020, strong advertiser demand and a strong live sports slate made us bullish about upfront ad spending. Those conditions no longer hold, and we now expect upfront pullbacks to begin in Q3 2020. Some ad dollars pulled from the upfronts could flow to the scatter market, but some spending may evaporate completely,” eMarketer analyst Ross Benes wrote.
Total U.S. TV ad spending declined between 22.3 percent and 29.3 percent in the first half of 2020, according to eMarketer. That’s about $10 billion to $12 billion less than expected. The research firm originally predicted a 2 percent increase in TV ad spending before the pandemic hit.
This comes as marketers call for shifting the upfront time frame, looking to negotiate on a calendar basis instead of on a broadcast year.