Upfront Negotiations Update; Gartner’s Findings On COVID-19

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Let Me Be Upfront

Advertisers are pressing networks to delay upfront negotiations until September or October, when they’ll have a sense of how programming is being watched right now and (hopefully) can forecast their finances. Some brands are eager to buy ad space right now with traditional upfront deals, Variety reports. That’s an interesting gambit, particularly for the kinds of companies that have grown revenue and are relatively stable during the crisis. Ad rates are low, so brands willing to risk upfront investments could be in good shape if TV consumption is high. If broadcasters wait, a competitive scatter market later in the year could be a revenue booster. But with canceled events and depressed demand, those networks want to secure commitments right now they can take to the bank.

Trimming The Fat

Seventy-six percent of marketers expect the coronavirus to significantly or moderately impact their budgets in 2020, according to a Gartner survey of 250 brands. Media and creative agencies will bear the brunt of cuts as marketers look to save money on non-working costs. Thirty-six percent of CMOs said agency fees will be a key area to make cuts as the recovery drags on, while 32% said they will reduce media buys. Marketers haven’t fired their agencies but are reducing work on long-term retainers and cutting nonessential projects, Gartner analyst Jay Wilson told Business Insider. Agencies that specialize in growth areas such as ecommerce, data and performance marketing could gain share.

An Epic Blow

Endeavor Group, which operates the talent agency WME and a live events business, including New York Fashion Week, the UFC and the Miss Universe pageants, is shopping its minority stake in the hit video game studio Epic Games. It’s a painful loss for Endeavor, giving up a seat on a rocket ship – Epic owns the smash hit video game Fortnite and live-streaming service Houseparty, both of which are surging. But Endeavor is in dire straits, with $4.6 billion in debt and no fat left to trim after layoffs, furloughs and pay cuts, The Information reports. Epic is reportedly trying to raise money at a $15 billion valuation.

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