For the last several years, securing the best TV ad rates has involved committing the bulk of the budget in advance to avoid the tumultuous scatter market.  The race for the best programming, rates and promotion opportunities has been one of the primary drivers in purchasing television media in bulk during the upfront.   Lengthy preparation went into reading the market, estimating costs, entering the market and getting the best possible price in a marketplace that tended to be more seller-driven.

We are now in a market with a different dynamic . . .

The current market is rewarding those advertisers who are fortunate enough to have budgets available to take advantage of fire sale inventory.  Many advertisers have become adverse to placing media for the long term due to the negative economic climate and uncertain marketing objectives.  Those concerns have caused advertisers to “option” a larger portion of the money placed in last year’s traditional upfront. 

Options are negotiated at the time the original buy is placed and represent a percent of the overall commitment that can be released back to the networks.  Options are one of the enticing benefits of participating in an upfront., along with lower pricing, more top tier programming and better promotions and sponsorships.

Today’s prevailing winds of budgetary caution have created a buyer-driven market environment where timing is everything and flexibility can pay big dividends for the advertiser.  A fluid budget that flows across mediums will allow marketers to take greater advantage of time-sensitive deals in certain weeks, months or quarters.  By getting into the market, switching networks, applying the brakes, changing dayparts, etc., a flexible media plan will result in better pricing and value-added deals in the current markets with the added bonus of reacting faster to consumer trends.  

We can all agree that the current economic climate needs to stabilize and begin the return to health.  But there are upsides to the downside of this situation.  Advertisers who can be flexible with budgets and other elements of their marketing objectives will not only take advantage of lower media demand, but will also be nimble enough to respond more appropriately to their consumers’ needs.

By: Suzzie Malloni, Sr. National Broadcast Buying Strategist