In the following weeks funding executives from many of the primary media businesses have quietly begun cutting offers with the big media players selling their wares in this upfront market. Yet this week has been a long era coming. Why? It seems like it’s a buyer’s market – at least according to the buyers.
Thank you for reading this post, don't forget to subscribe!“This is probably the slowest growing market I’ve seen in 20 years,” said one buyer, who declined to speak for attribution due to consumer sensitivity — as did alternative investment professionals. “Every time it’s a buyers’ market, the market slows down.”
Some other funding leaders added: “Partners need to accept that they will not get the costs they were planning for in advance. They have a Jesus moment that needs to happen, and then they realize, ‘If I don’t move soon, I could lose a lot of (dollar) volume.’ And this is actually happening due to the influx of supply into the streaming sector.
Some of the recent trends in the form of negotiations and reductions on offers are the addition of stock of additional sports activities and pricing rollbacks that keep consumers concerned about core streaming products and services. All funding professionals who spoke to Digiday spoke on condition of anonymity to speak more openly.
The involvement of Amazon High as a supplier for the first generation adds a new twist to the complexities of an already complex market. For one, its aim is to make all of its customers ad-supported – forcing anyone who wants ad-free service to switch again for a fee – the market has been flooded with millions of eyes and a ride. Prices have gone down.
For another, an investment chief lamented his belief that Omnicom and WPP – two highly owned companies competing to win Amazon’s advertising account, accounting for an estimated $2.5 billion in media spend – in advance of Amazon. are offering preferential pricing. The e-commerce and content giant does its business with its maintenance company. As expected, neither Omnicom media staff nor GroupM would comment on whether they were doing so or not. A story in Wall Boulevard Magazine a few weeks ago offered a glimpse at that risk.
Meanwhile, all patrons who spoke with Digiday said they were rolling back the pricing on the primary streamer, which the primary buyer described as “vaguely out of touch with the market.”
“My focus was that we would adjust and reset the digital streaming pricing that exists in the market,” Patron said. “Pricing must come down now, and I have focused 95% of my efforts on resetting all digital streaming pricing.” Patron said it’s a question of the premiums and fees that streamers add to their pricing – not like an automobile broker that tells you what your cost per 30 days is, although the amount is later determined to be anti-rust or Provides wiper coverage surcharge.
“When you want to put the news out of something, they’ll charge you a 10% premium,” the patron said. “If you’re going to do it programmatically, they’ll charge you a 15% premium. If you are going to target something, they will charge you a 25-30% premium on top of your CPM. I thought that’s why you’re buying streaming – to be more targeted. So why are you telling me the CPM is $28 when it’s actually $48 after you’re all said and done?”
All this takes ages. Another investment chief said it took his generation to organize all the decisions he made — of which there are many more than two years ago, including virtual video, programmatic, direct versus social video on CTV’s control — before his Instead of negotiating the price for the buyers.
“We really wanted to get our ducks in a row before the price reached that point,” said Patron, who is also looking for a CPM rollback. “We know where prices were going to end up compared to last year, and how the market is relative to what we think it is. It was really around landing the plane on all the different elements that go into the actual conversation. And you’re no longer negotiating two or three day stretches, or two or three channels. This is a lot.”
The content of sports activities is meeting most of the demand, yes most of the funding heads. Another funding head said, “Partners with very large sports portfolios are probably the ones you’re going to see eliminated sooner.”
And dealers who have a fair amount of sports activities stock in their content portfolio will likely close their deals quicker than dealers with only entertainment. “The sports market is seeing higher demand than entertainment/linear and streaming,” said a fourth buyer.
All that can be said in advance will likely not be completed until August – perhaps the most surreal events in recent years. It doesn’t matter if the budget is bad, especially in leisure, CPG and tech, as the fourth buyer mentioned. The two divisions that are tipped to spend more are pharma and sports.
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