Saturday, March 14, 2020 11:09:21 AM
https://ih.advfn.com/stock-market/NASDAQ/alphabet-GOOGL/stock-news/81968732/digital-ad-upfronts-weigh-going-online-only-amid-c
This year's Digital Content NewFronts were supposed to be a big party for streaming video. Now, its organizer is advising presenters to make their pitches to advertisers online-only as the media and marketing industries grapple with the novel coronavirus outbreak.
The Interactive Advertising Bureau, which organizes the NewFronts, an annual series of events meant to mimic the TV industry's upfront ad galas, said it would add a video-streaming option for presenters and attendees to use in place of a live, physical event.
The trade group said presenters can still hold events with live audiences in attendance, but said it strongly recommends going online-only.
This year's events are set to take place from April 26 through May 6 in New York.
YouTube, which is owned by Alphabet Inc.'s Google, said it is canceling its in-person "Brandcast" event in favor of a digital-only version to be streamed on the video platform. YouTube is considered one of the founding companies of the current iteration of the NewFronts, and will host its ninth event this year.
Twitter Inc., which last week suspended all noncritical business travel and events, will produce a streaming-only NewFronts presentation this spring, a company spokeswoman said. This is Twitter's fourth year hosting a NewFronts event.
Roku Inc., which is part of the official IAB NewFronts calendar for the first time this year, said it would likely make a decision in the coming weeks. "We're assessing internally on the exact plans for NewFronts," a Roku spokeswoman said.
Roku canceled an event it planned to host later this month in Miami for advertising clients, according to a person familiar with the matter.
Digital publishers and technology companies use the NewFronts to pitch advertisers on their brands and upcoming programming plans -- much like the way that TV networks trot out big stars during their splashy upfronts to talk up their upcoming TV schedules.
The rise of the streaming era was expected to take center stage during this year's NewFronts. Amazon.com Inc. is hosting its first official NewFronts presentation this year. The IAB had also added two days of conference programming devoted to the streaming-video business.
Walt Disney Co.'s Hulu didn't immediately respond to an inquiry about its NewFronts plans.
Potential changes to the NewFronts come as some TV ad sellers including A+E Networks, AMC Networks and Fox Corp. have already canceled their upfront events. A+E Networks said it would opt instead for an online presentation; AMC Networks said it would hold individual meetings with advertising clients.
Billions of dollars of TV ad spending is negotiated every year during meetings that follow the upfronts. A majority of broadcast network prime-time and other national-level broadcast and cable TV commercial time is bought and sold during upfront negotiations, said Brian Wieser, global president of business intelligence for WPP PLC's ad-buying giant GroupM.
The NewFronts, which over the years have also featured participation from TV companies ranging from Disney to Comcast Corp.'s NBCUniversal, haven't been as successful in establishing a market for upfront digital ad spending.
That is partially because digital video advertising inventory is virtually limitless, whereas traditional TV programming has a finite amount of available commercial time. That means advertisers face less pressure to commit to digital video ads much ahead of time.
Most digital advertising is also not restricted to a fall-to-spring TV schedule, said Kait Boulos, vice president of marketing for Cadreon, an ad tech unit owned by IPG Mediabrands.
"Digital media is just not bought that way," she said. "Programming can start wherever and whenever."
Some NewFronts presenters, such as Hulu and YouTube, have been able to secure ad money upfront, largely because both are able to present some type of scarcity for their most popular programming, ad executives said.
But there is still a wide gap between how much video ad buyers commit to spending during the upfronts versus the NewFronts: One agency investment executive said 80% of their agency's upfront budgets still go toward traditional TV, with the rest largely going to Hulu and YouTube.
One benefit of the NewFronts is giving presenters -- especially smaller companies -- the chance to get valuable facetime with ad buyers. That will be hurt by hosting events remotely.
Going online-only could also lead presenters and marketers to reassess whether it is necessary to host NewFronts as in-person events, which can cost companies hundreds of thousands to millions of dollars, especially if it has little or no effect on ad deals.
"It's important to me to know that [the NewFronts] are a point in time when digital video is really top of mind, where I can go and see new products and ideas in the marketplace -- it's a good thing for the industry to organize around," said Andrea Ching, chief marketing officer at brand-safety measurement company OpenSlate. "But it might not need to be a physical event."
Write to Sahil Patel at sahil.patel@wsj.com
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