‘A perfect storm’: Can networks help advertisers weather uncertainty?

Upfronts week is almost upon us — the ad industry’s annual curtain-raiser, where major media companies make their case for ad dollars.

Experts told The Current that hesitancy in the market — prompted by President Donald Trump’s tariffs — could lead to shorter-term commitments and more spend in the scatter market. As a result, ad budgets could be reallocated to digital channels that invite programmatic real-time bidding, like connected TV (CTV).

“For the networks, this needs to be a call to action to diversify what they’re selling and how they sell it,” says Tamara Alesi, CEO of Mediaplus North America.

“They need to be thinking about reach everywhere, how they can be consumer-first organizations, and then how they bring advertisers along for the ride that brings value to both.”

A recent MoffettNathanson report predicted that as linear TV loses share, media buyers could “look at more permanent alternatives led by connected TV streaming services or an even heavier digital mix.”

This reflects larger trends in the ad industry that go beyond upfronts. U.S. internet ad revenue rose 16% in 2024 compared to 2023, according to a recent report by IAB and PwC. Digital video (accounting for both CTV and online/social video) was the fastest-growing format last year.

This year, IAB projects that digital video will grow another 14%, as well as capture 58% of total TV and video ad spend, over double its share from five years ago.

Despite some advertisers expecting spending cuts due to the tariffs, CTV remains resilient. A separate IAB survey found it was the least likely channel to be dropped.

“The data-driven approach [of CTV] allows for precise audience segmentation and performance measurement,” Margaret Firalio, SVP of brand media at Ogilvy, says. “This results in the advertisers having greater control and accountability. CTV provides a valuable tool for both upfront commitments and scatter market buys.”

Live sports could still triumph

Major streaming platforms have been ramping up their ad businesses, and live events — particularly live sports — are playing an increasingly bigger role in this effort.

With broadcast rights for most of the major sports leagues locked in through the end of the decade, and consumer demand unlikely to wane, this could be an area where advertisers continue to invest.

“Live events, particularly sports, remain crucial to upfront negotiations,” Firalio says. “Their ability to deliver large, engaged audiences makes them highly desirable for advertisers seeking broad reach and impact.”

It’s no wonder, then, that this year’s upfront presentations could lean into sports and other live event programming, according to The Hollywood Reporter.

“There is a huge amount of players that are competing for live sports moments,” Alesi says. “In a way, that’s the new prime time. That’s when people choose to actively tune in, versus everywhere else it’s more on-demand. So live sports will continue to have a hero’s spot at the table and continue to maintain share of dollars.”

With the growing importance of live TV to streaming strategies, sports and other events were inevitably going to play a larger role at upfronts and beyond.

Just a few short years ago, media companies treated linear and CTV as separate lanes when it came to upfront deals, according to one media buyer. That’s changing.

“Soon, within the next few years, upfronts for networks and broadcasters will be CTV and linear agnostic,” the buyer says.

In other words, it’s all just TV.

The short or long game?

This year, economic questions springing from tariffs could heighten these shifts. Live events, digital channels and a focus on flexibility and data-driven outcomes could take on an even greater role.

“Economic uncertainty is driving a need for agility, while the rise of digital channels like CTV is enabling more targeted and measurable advertising,” Firalio says.

Ahead of upfronts, some holding companies were already signaling mixed expectations for the year ahead. Omnicom lowered its projection for its organic growth this year, while Publicis reinforced its own — hinting at varied confidence levels across the industry.

Meanwhile, a recent iSpot survey of 260 marketers found that 55% of respondents expect to make the same upfront commitments as last year. In other words, many advertisers seem to be treading carefully.

That’s why Alesi expects a “soft” upfront this year, even if sports remain strong.

“There’s a perfect storm,” Alesi says. “Our partners are reassessing if they need to spend how they used to spend, or if they can reach consumers in a much different way. Why in the world would you lock up your investment in a year of uncertainty? Especially when you can do streaming or CTV, when you can do programmatic...I don’t think there’s a need to commit in that way unless you’re a bulk buyer.”

But despite a greater pivot to agile digital channels, the media buyer was still dubious of brands remaining static, or even pulling back, on long-term investments.

“The benefit of longer-term, longitudinal observations means that once the economic outlooks improve, brands will have a clearer understanding of what works, all the time, not just in a reactionary scenario.”