Overall, this year’s Upfront is “not all that different from a marketplace that’s reflective of a relatively healthy economic backdrop,” Geraci, who is President of National Video Investment at OMD, says in this interview conducted by OMD’s Ben Winkler at the recent Beet Retreat in the City. “There is a significant amount of pressure in certain areas, mostly due to supply dynamics in linear television and fragmented viewership, combined with some increased spending from advertisers that rely heavily on television,” says Geraci.
He pinpoints that reliance in large part as relating to older-skewing brands for which “television is still really the best place, the most fertile hunting ground.”
Asked about efforts by providers like Fox and NBCUniversal to roll out reduced ad-load offerings, Geraci responds, “Time will tell.”
While there are potential positives in making the linear TV experience more like what viewers can get with digital offerings, reducing commercial load comes with a big caveat. “When you restrict supply, there are going to be pricing issues, and we get that,” Geraci explains. “The astute buyer tries to pay the lower price and we’re making efforts in that regard.”
Asked by Winkler about the efforts by Fox and NBCU, Geraci says, “I don’t know that we’re there yet in terms of finding that price-value relationship, for at least the two being discussed now.”
Looking ahead, Geraci outlines his desired outcome. “Our hope is that over time, if the expectation is that the viewing experience is better, more people will interact with the programming, ratings will ultimately increase. That’s the hope is that if you improve the experience you’re going to ultimately further down the road build back supply simply by higher ratings of at last live or slightly delayed commercial television. That’s sort of the holy grail.”
As for his thoughts on OpenAP, the audience targeting consortium started by Fox, Turner and Viacom that both NBCU and Univision recently joined, Geraci calls it “sort of common ground if you will for the optimization systems. If you can bring standardization to anything that is not standardized, in general you create more interchangeability in the marketplace and basically a more level playing field, and you allow the advertiser to make better decisions and selections.”
Geraci notes that OpenAP is for planning using common audience target definitions across networks but not for actual purchasing of inventory. So buyers are still “forced to optimize within just their set of offerings. It’s not the completely fluid situation that we’d like to see.”
One thing that has changed for the better over the decades that Geraci has experienced the back and forth of Upfront dealings is the temperament. He says there’s “more of a sense of fair play I think nowadays than I think than there was in the earlier times.”
This video was produced at the Beet Retreat in City & Town Hall on June 6, 2018 in New York City. The event and video series are presented by LiveRamp, TiVo, true[X] and 605. For more videos from the series, please visit this page.
]]>“Time has proven that making the long-term bet is a good idea for both sides in the equation,” says Chris Geraci, President, National Video Investment, OMD.
Geraci was one of the featured speakers at last week’s Beet Retreat in the City, along with Ashley J. Swartz, CEO of Furious Corp. In this video, they discuss the dynamics of the video marketplace and parse the semantics of what now constitutes “television.”
Geraci has seen lots of change since starting his advertising career in 1987 at BBDO New York. Yet amid a rapidly changing media landscape, the bedrock role of advertising hasn’t changed all that much.
“We support a crucial part of the entertainment industry by way of advertising dollars, that allows for production and better quality content to come forth if they can count on a longer term advertising commitment,” he says.
The economics of what is often referred to as a “futures market” remain in place during the negotiations that typify the Upfront.
“For the advertisers and agencies that service the advertisers, we know we’re generally getting a better deal by working in the Upfront model,” Geraci says. “It’s just more efficient from a cost-per-thousand basis, which is usually the metric that’s being used. It’s just a better deal in the Upfront.”
Asked by Swartz to describe the change he sees year to year, Geraci notes the increase in digital options available. “I think the consideration set keeps widening. We now have definitely more online opportunities to interact with what we consider to be premium content. So the choices are broader.”
Given a “solid economic backdrop,” Geraci says that with consumer marketers “having decent results” some are putting that money back into media. “There’s a little bit more supply in some areas, including sports, perhaps a little less in some of the linear TV dayparts. So that’s creating a little bit of pressure there.”
Asked by Swartz whether there remains a distinction between “television” and “video,” Geraci says he believes it’s all video right now.
“In fact, we removed the TV designation from all of our job titles to prove that point publicly. Television is simply a physical device as a way to deliver what quality content and ad-supported content is what we transact in.”
OMD’s clients have the same mindset, according to Geraci.
“For the most part, they’re in the same place,” he says. “I think it’s been very helpful that a lot of the linear TV based companies have sort of morphed what they serve the consumer to be a multiplatform experience.”
This video was produced at the Beet Retreat in City & Town Hall on June 6, 2018 in New York City. The event and video series are presented by LiveRamp, TiVo, true[X] and 605. For more videos from the series, please visit this page.
]]>“By and large, if you have a sizable amount of advertising dollars to spend in national television we try and get you into the Upfront, because history has proven it’s an advantageous position to be in,” Chris Geraci says in this interview with Beet.TV.
For a variety of reasons, some advertisers can’t make a long-term commitment for TV inventory. In those cases, Omnicom tries to structure shorter, multi-quarter deals if possible, according to Geraci.
Even with the arrival of digital publishers and their inventory, giving brands more choices of where to run their ads, supply and demand still dictates pricing during the Upfront. This is particularly the case when audience fragmentation and audience losses ultimately impact the available supply of gross ratings points.
“We actually saw a little bit of growth in last year’s Upfront in terms of advertiser spending,” Geraci says. “That combined with what was a pretty horrendous year in terms of ratings performance certainly produced a significant amount of inflation.”
He doesn’t expect to see similar TV budget growth in 2017, “But inflation is part of the deal when you’re talking about a supply and demand environment.”
Advertiser demand for better audience targeting beyond traditional age/sex demographics spawned the recently announced OpenAP consortium involving Fox, Turner and Viacom. Geraci describes the move as be “great” because it provides a uniform metric in the advanced targeting arena.
Asked if he expects to see more programmers join OpenAP, he doesn’t see why others would not. “You’re basically offering something to the agency and advertiser community that is going to be simpler to use, it will be easier to make comparisons,” Geraci says. “I don’t really know what the downside would be of not being part of it.”
When the subject turns to the continued emergence of brand-safe environments for video ads, he believes it’s going to be “shouted from the mountaintops” during the Upfront season. But he offers perspective as well.
“I think that there are still plenty of places in the online world where brand safety can be all but ensured,” Geraci says. “We’re talking about a very specific problem dealing with what is, for the most part, user-generated, non-professional content that has always been an obvious concern.”
This segment is part of a series leading up to the 2017 TV Upfront. It is presented by FreeWheel. To find more videos from the series, please visit this page.
]]>“We’re just beginning to experiment with one company that’s involved in that,” Geraci, who is President of National Broadcast for the media agency group, says in an interview with Beet.TV at CES 2017.
He describes it as “sort of a rethinking of the whole Canoe idea,” a reference to the 2008 launch of Canoe Ventures by a half dozen major cable operators. The initial concept of the company was to develop interactive TV ads, as ADWEEK reports.
The modern iteration would direct advertising not on a local basis as with addressable, which is limited to two minutes of local advertising inventory, but on a national basis based on what’s known about specific households.
It could involve “ten versions of a particular brand advertisement that has different meanings for different individuals,” Geraci says. “But really it would be in that one commercial position that the advertiser owns with a particular national network.”
As for local addressable TV ads, “As you get these distribution platforms to be bigger and of greater scale that can then precisely target households and you’re covering most of the U.S., it becomes a bigger idea,” he adds.
On the subject of commercial load within programming, Geraci lauds the efforts of media companies like Turner that are experimenting with fewer commercials in addition to offering brands sponsored content opportunities that are complementary with programming.
“I give them credit for trying to address this head one and de-commercialize at least one of their networks in a major way to see if that’s going to improve viewership,” Geraci says. “Let’s face it. If they build ratings by lowering commercial load then they’ve got more GRP’s to sell. So in their view I guess it’s a practical business model to try and do that.”
As for branded content that fills in as a substitute for traditional ads, Geraci says Omnicom has experimented with it but the format is limited to advertisers that have “a certain specific message” that ties in well with the content.
“When you’ve got that and can make that work, it’s sort of lightening in a bottle and it’s a wonderful execution to take advantage of. But I don’t think it’s a large scale business that just about everybody can be involved in,” Geraci says.
This video was produced as part Beet.TV’s coverage of CES 2017 presented by 605. For more videos from the series, please visit this page.
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