February 08, 2021

Active National Marketplace Update - 2/8/21

Key Take-Aways

  • Limited 1Q avails in an active national scatter market
    • Active International offers alternatives which include XACT TV, Involved (Local OTT) and Direct Response OTT
  • Fast paced 2Q scatter market with little options being exercised  
    • Expect another challenging quarter
  • Upfront planning is happening now, and we must be ready with a Plan B
    • Local and OTT solutions available as National will continue to be tight
  • Super Bowl ratings fall an estimated 15% YOY
  • Discovery + is opening their platform to other advertisers outside of their launch partners
  • Studios holding firm on releasing films on the big screen

 

1Q Scatter

As we reported in our previous note, the 1Q scatter marketplace is extremely tight. There are pockets of available inventory across cable and broadcast. Cable is approximately 90-95% sold, while others are completely out of sale. Broadcast is virtually sold out for the quarter and the networks are continuing with writing non-guaranteed scatter. Scatter increases range around 20% and 50% across cable and broadcast respectively. However, advertisers who have historically low bases could see a huge uptick in pricing by approximately 100% depending on the programming and mix they are looking to secure. This will be the trend for the remainder of the quarter.

 

2Q Scatter

A fast paced 2Q scatter market is already materializing with spending coming in from Telco, Pharma, Streaming Services, and QSRs. Second quarter options are due next week but we believe that options will be very light which is expected based on the demand for the upfront and strong scatter market. The tightness we reported in 1Q is also trickling over to 2Q and 3Q. The cable networks are approximately 70% sold and broadcast is experiencing its usual tightness. Cable increases are approximately 15% while broadcast ranges from 25%-50%. Demand in 2Q is always high as many advertisers have holiday and seasonal campaigns they are looking to push (Spring, Easter, Mother’s Day, and Memorial Day). Additionally, the programming is always strong as the networks typically run their finales in the middle of May.

Despite seeing increased scatter spend across all categories we are still missing three key categories: Studio, Retail, and Travel. With the COVID vaccine underway everyone remains hopeful that a normal year is on the horizon. Our assumption is that money will eventually come back into fruition which will further complicate the already challenging marketplace.

 

Upfront

Pre-upfront planning is starting to kick off and although it is still extremely early all signs are pointing to an aggressive upfront. The upfront this year is forecasted to be a sellers’ market and advertisers who are looking to increase volume will need to start engaging the networks early. This year there will be a push to expand the advertiser’s target buying demographic as the current 18-49 and 25-54 do not reflect the 55+ audience on this medium. We believe the networks will be willing to write a more favorable rate of change to advertisers who compromise and expand demos beyond the traditional buying demo. Additionally, there will be a more hybrid approach to include OTT and streaming to capture the younger TV viewer as we know the older viewers are watching linear TV.

For example, A&E Networks will be moving forward with a total audience currency in this year’s upfront. “By recognizing and engaging with all audiences, brands can finally plan media more holistically - to leverage every audience across every platform and to tap into the receptivity and buying power of the critically undervalued 55+ viewer,” said Peter Olsen, President, Ad Sales.” The move will broaden the primary buying demo to 18+.

 

Sports

The Tampa Bay Buccaneers defeated the Kansas City Chiefs 31-9 in Super Bowl LV. An early report from Samba TV showed that the national TV audiences fell 15% vs. 2020. The data is based on Samba TV’s connected TV universe. They estimated that 32M households tuned into the big game. More to come on the ratings as we are still waiting for CBS to put out the final numbers.

 

Streaming

Discovery + inventory is now available to all advertisers beyond their initial launch partners. However, their preference is to sell Discovery + packaged with their “GO” (cable authenticated) FEP inventory. All requests for inventory exclusively on Discovery + will be reviewed for approval on a case by case basis. They are not excluding any categories on the platform and started to accept tune-in campaigns. Tune-in will be priced at a premium depending on the messaging.

Univision is also expanding their footprint with their new initiative PrendeTV. The new ad-supported streaming service offers VOD content to US Hispanics and consumers in Latin America. PrendeTV is the newest AVOD service to hit the market and will be the only one that specially caters to Hispanic Americans.

ViacomCBS’ Paramount + made a splash in the Super Bowl last night airing multiple ads as they get set to launch on March 4th. The ads featured a cast of characters whose content will be featured on the streaming service.

 

Local

As the National marketplace continues to have challenges, we will be collaborating with the local team so we are ready with a Plan B. The Local team has opportunities within key markets to offer as an alternative solution. Additionally, they are anticipating having access to the Grammy’s on the CBS O&O stations on 3/14.

 

Cinema

Studios are holding steady on their decision to keep films on the big screen with vaccines underway and the hope of an end to the pandemic. Currently, Paramount Pictures has no plan to shift Top Gun: Maverick onto the streaming platform Paramount+.

 

Film Shifts:

Godzilla vs. Kong 5/21/21 > 3/26/21

No Time to Die 4/2/21 > 10/8/21

Cinderella 2/5/21 > 7/16/21

Peter Rabbit 2: The Runaway 4/2/21 > 6/1/21

Ghostbusters: Afterlife 6/11/21 > 11/11/21

Morbius 10/8/21 > 1/22/22

 

 

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