In the middle of doing virtual roadshow presentations for ad buyers, Disney Ad Sales president Rita Ferro answered questions about this year’s market and the future of the upfront for Broadcasting+Cable, providing details about some of the new ad products Disney is pitching to marketers.
How was doing a virtual event different from getting up on stage at Lincoln Center?
I love the Lincoln Center experience. There's something really fun about that, when you get butterflies in your stomach because you're going out in front of a big presentation. I always tell people it's one of the best rooms to do that in just because everyone's happy to be there and everyone's excited to see what you're going to say. It’s so unlike when you're pitching your heart away at a business meeting when there's 25 people in the room ready to poke holes at everything. The energy of upfront week and those presentations is so great; you do miss up a little bit with this format.
Because no one had to travel and you can work around everyone's schedule, the star power and the support that you get from talent was better in some ways in these events. There's great opportunity in both of them. I think the best combination would be some similar presentation to this and a big fun party afterwards. By the way, aren't you dying for a little socializing and cocktails?
What kind of feedback have you gotten from clients?
I think what people have enjoyed is it felt the most upfront-like from a presentation perspective and a content perspective. I think they all unanimously liked seeking Jimmy [Kimmel]. Someone said to me. 'I feel like the world is normal again because we got to see that.'
The other feedback I got was it was really thoughtful and how it was laid out. It was great that it wasn't super long and it was really great also to hear from the network creative heads talking about how they're thinking about content. One of them said to me the fact that they've been spending a lot of time developing scripts and have a lot of material was really heartwarming because they are like, okay, so it's just about getting back into production and then we should have some of the best content we've ever seen.
One of our biggest agency clients that you realize the Disney portfolio is big, but when you see it all together, now inclusive of Hulu, you’re like, wow, I’ve got to be there. Which was great to hear because we as a company have been through a lot. We’re a media company, but we’re also an entertainment company, a travel company, and we’ve had a lot of disruptions in many of our core businesses. I think that helps us from a media perspective because it heightened our sensitivity to what our clients are going through. We’re going through it too.
Are negotiations going on like a regular upfront market?
There are definitely conversations going on. In terms of timing, all of us moving at the same time, I just can’t imagine anyone thinks that’s true. However, I will tell you because sports is such a big piece of what we do and a lot of sports anchors strategic positions. Think of Monday Night Football halftime or pregame. They tend to be mulit-year deals so a lot of that has started to move.
Multiple clients have engaged us to have conversations around what would an upfront look like. Some may do two separate deals because they have to buy a lot of sports in the fall. Many of the conversations are about how do I prepare for back to school and the holidays. Those are such strategic milestones in terms of a purchase cycle for many of our clients and that doesn’t change because of what’s going on now, so the notion of moving to a calendar deal doesn’t work for them. Some may do [back to school and the holidays] separate from a calendar year deal.
We’re having all kinds of conversations and what’s interesting about this year is that the conversations are not consistent and they’re all unique.
There’s a lot of talk about how this is going to be a buyers’ market. Are the agencies pushing for price rollbacks and how would you react to that?
We are not seeing that in our business. Even in scatter, we’re still [seeing price increases] in the significant double-digits. Everybody's business is different but we have not seen that in our business.
It will definitely be a buyers Market compared to the last two years. There's no question. The last two years were high-doubles and that's where this was headed this year to prior to COVID.
There was this whole notion of third quarter options being really bad and we didn't see that either. Yes, they're more than they have been historically. It would be shocking if that had not been true. But somebody was saying they were going to [cancel] 50%. They're nowhere near that. Not even half that. So to some extent people are feeling, OK, we're going to start to get back. I'm not going to say this is the new normal, because I don't think whatever this next phase is the new normal. I think it's the next phase.
Advertisers are seeking flexibility. What does that mean to you?
Flexibility is definitely a question that comes up. Flexibility doesn't mean cancel. When auto racing didn't happen, it’s ‘where can I move that money to’. Or ‘my business changed. My supply chain isn't working the way it's supposed to,. I need to move money from second to third quarter.’ That's what flexibility is. And obviously, yes, there are going to be categories like retail and travel this year that absolutely wanted to cut their budgets, but for the most part, especially when it came to sports, a lot of them move the money in the hopes of those leagues would come back. NFL is a great example. I think people are going to move and move early because they think there's a big opportunity there. Take the NBA for us. In the second quarter, some people took their money, but a lot of them said I want to move with the NBA to whenever it comes back. And others said I have a product launch or I have a very specific reason I was going to be on air in April and May and I still need to be there. What else can we do? They just need to know they can move money around without penalty.
During the presentation, you talked about some new advanced advertising capabilities. What details can you give me?
Let me first talk about our digital offerings. The first question I get asked a ton is about the introduction of Hulu into our portfolio now. There are two things we’re bringing to market. The first one is a unified video product called Disney Hulu XP, which is basically cross platform. You do one buy against the massive deliver across both of those. We guarantee you on completed views. It’s one ad solution using our first-party data. A client can bring their data and do it against audience-based targets. And there’s one invoice across both Disney and Hulu. As part of that on the automation front, we’ve created a unified programmatic product that provides one single storefront across all biddable inventory across both Hulu and Disney where you will have client-side decisioning. And they can measure brand frequency and again, one single invoice.
Managing frequency across our entire digital buy, or basically across the marketplace,has been a significant ask for clients for a long time and the ability to do programmatic continually becomes more and more important in every conversation we're having. People want to be able to do a digital deal and be able to run that media either direct or programmatically and have it count towards their goals. And so both of these products we think are going to really yield a significant opportunity, because we think he clients have been asking for it for so long.
Ideally we want to eventually get to programmatic guaranteed also counting in that but we need to unify by the ad technology stack to be able to do that. So we've now started that process. But for now we’ve got the biddable piece and cross platform video at one price across everything and I think that’s a big move in the right direction.
Who’s involved in that tech stack?
On the programmatic side we’re working with Telaria.
You said you have an end-to end attribution solution?
We’re partnering with Samba TV to offer clients cross-platform, cross-portfolio attribution. That’s for all KPIs, everything from offline conversions and foot traffic, as well as engagement. We work with IRI, Catalina and Crossix for offline conversion and purchase, Factual and Cubiq for foot traffic and Kantar and Lucid for brand lift.
We’re also joining the Nielsen addressable TV platform. As part of that we are going to be running addressable ad campaigns and evaluating how it interoperates with our existing and evolving workflows.
They’re all things that clients have continued to ask for. What we will see a lot of opportunity with cross-platform and programmatic. There’s no question that’s where the digital marketplace is moving.
I think a lot of what's going on right now because of how disrupted the business has been its really around the things that are tried-and-true, right? Audience segments, targeting, the ability to be flexible with money moving from screen to screen. Measurement continues to be a conversation point, obviously, for advertisers.
The other interesting conversation with advertisers right now is the whole notion of demos. Is it more important to have a demo guarantee versus counting audiences that are 18 plus, because depending on the category the whole notion of the demo may or may not be as relevant as counting the entire opportunity. And so those are some of the conversations that are going on now with clients as part of this upfront that I think will be really really interesting.
Bob Iger talked about how the pandemic could lead to changes in the upfront process. Do you think there’s going to be innovation coming out of this situation?
I think Bob just reiterated a position he's had for a while now, which is the notion of how we develop shows and how we put shows on is not a one time of year process but a 365-day process. And to the extent that more and more opportunities get across a year. I think we're going to continue to evaluate that. There's no question that we all feel like this presentation felt right for the right time for now and that we thought it did a great job of speaking to the quality of our stories, the bigness of our portfolio, and highlight some of the best stuff coming.
Would we ever not do a show again at Lincoln Center? I think it's too early to say.
I can't imagine it will be the same ever again but that doesn't mean we wouldn't do a big presentation like that. We might wind up doing it twice a year because that's what makes sense. Historically the upfronts haven't shown mid-season shows in the same way and those shows are equally as important for our business overall . The thought process of re-imagining how we show the best of our content to the marketplace is an ongoing conversation.
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