Quibi Disappoints Advertisers; Some Upfront Discussions Forego Outcomes-Based Campaigns

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Not What We Signed Up For

PepsiCo, Taco Bell, AB In-Bev, Walmart and other advertisers are seeking to renegotiate or defer payments to Quibi due to lackluster performance or the pandemic’s impacts on their business. Brands paid up to $150 million for a debut sponsorship on the new streaming service, and some are disappointed by low viewership numbers and worried about missing ad guarantees, The Wall Street Journal reports. Targeting 7 million subscribers in its first year, Quibi has only signed up 1.5 million users since its launch in April. In response, the company is cutting costs by delaying hires and minimizing contractors. Co-founder Jeffrey Katzenberg has blamed the coronavirus pandemic for Quibi’s poor performance, but sources say an overreliance on scripted programming and inactive users have also caused problems. “They’re not even coming close to hitting their numbers,” said a person familiar with Quibi’s ad deals.

It’s A Virtual Guarantee

Broadcasters have developed ad offers based on guaranteed sales or outcomes. It’s a natural progression, since they can’t use real-time digital metrics based on individuals – TV campaigns are at a household level – yet want to use more data and digital-style performance measurement. But now those outcomes-based campaigns are being removed from upfront discussions, Digiday reports. The guarantees are mostly tied to store sales, so the attribution model is a mess right now. “The models have to be brand new, based only on data from the last weeks, not the last year. For most of the TV industry, everything is a year-over-year look,” said Simulmedia CEO Dave Morgan. Those offers wouldn’t disappear though, since instead of being upfront ad deals, campaigns based on guaranteed outcomes would move to the scatter market.

Paid And Earned

News companies are scrambling to replace advertising and sponsorship budgets, and that desperation diminishes the church-and-state divide between editorial and ad sales. Sometimes that means product review or ecommerce articles are bumped up to the homepage or that reporters are paid bonuses based on subscriptions generated by their stories. Gannett, the largest US newspaper publisher, is taking it a step further with a joint editorial and advertising initiative called “Rebuilding America.” The initiative will put stories and businesses in local papers – for a price. USA Today will anchor the content with macro reporting on restaurants, tourism and new long-term consumer trends. Smaller papers will fill out those stories with local items with similar themes, also opening the effort up to national brand advertisers and local SMBs. MediaPost has more.

Two Votes Against Targeting

House Democrats are working on two new proposals to limit voter microtargeting on platforms such as Facebook and Google. The latest comes from Rep. Anna Eshoo, D-Calif., and limits how narrowly political messages can be targeted to groups online. Rep. David Cicilline, D-RI, proposed a similar measure a week earlier with limits on targeting voters by location, age and gender, CNBC reports. Both proposals allow individuals to file a lawsuit for alleged violations. Political ad targeting has been a point of contention since the 2016 presidential election, when Russian disinformation campaigns were able to influence small groups of voters. Twitter banned political advertising completely in October to avoid contention, while Facebook still refuses to fact-check and remove false political speech.

But Wait, There’s More!