Early signs are that this year’s US upfront ad sales period (the annual ritual when advertisers and agencies book time for the upcoming TV season) could exceed analysts’ expectations and register a slight rise on last year.
To date, few firms have informed agencies of their finalised upfront budgets, but preliminary indications suggest that spend by individual advertisers will vary year-on-year between flat to 5% up – better than the slight decline many analysts expect.
Overall, this could produce a 3% to 4% rise in upfront budgets, beating the 2001 total of $6.9 billion (€7.7bn; £4.7bn) by about $250m. A number of top advertisers, none of which wished to attach their names to their opinions, told AdWeek that spend would rise between 2% and 5%.
A major budget-boosting factor is the high level of competition in several categories. For example, the automotive sector is the scene of a fierce campaign by non-US manufacturers to break the dominance of the Big Three – General Motors, Ford Motor Company and DaimlerChrysler. Consequently, both sides are expected to maintain or increase adspend levels.
Battles for market share are also raging in the telecoms, soft drinks, credit card, beer, fast food, movies and retail sectors – all to the benefit of upfront spend. In addition, pharmaceutical firms may wish to get as much as they can from TV advertising this year, lest forthcoming legislation restricting marketing activity is passed by Congress.
The upfront season is expected to kick off late May after the major broadcast networks have unveiled their new prime-time line-ups.
Data sourced from: AdWeek.com; additional content by WARC staff