From PepsiCo to GM, Big Advertisers Set to Cancel Commitments to TV Networks

The Wall Street Journal ^ | May 12, 2020 | Suzanne Vranica

[abb]

Big advertisers from General Motors Co. to PepsiCo Inc. to General Mills Inc. are seeking to walk back spending commitments they made to broadcast and cable networks, a dynamic that is testing the industry’s five-decade-old way of doing business.

TV ad spending fell in the initial weeks of the coronavirus pandemic, but was insulated from an even bigger drop. That is because the majority of the roughly $42 billion spent on national TV ads in the U.S. is bound by contractual commitments that are made well in advance of a new TV season, which starts each September.

Under those “upfront” deals, the first real opportunity since the pandemic struck for advertisers to cut back future spending commitments began May 1. Companies now have the option to cancel up to 50% of their third-quarter ad spending.

Many companies are seeking to take advantage of that option to varying degrees, including General Motors, PepsiCo, Cracker Barrel Old Country Stores Inc., General Mills, Domino’s Pizza Inc. and pharmaceutical giant Sanofi SA, according to people familiar with the discussions.

Ad buyers estimate that roughly $1 billion to $1.5 billion in commitments for third-quarter ad spending could be canceled. “The cuts are going to be pretty deep,” said Dave Campanelli, chief investment officer at media buyer Horizon Media.

[fella]

I remember when shows were produced by single companies and local stations did the same. The content was of a higher moral quality then.

[dfwgator]

[dfwgator]

Frank said it best:

Frank Zappa - I’m The Slime

I am gross and perverted
I’m obsessed ‘n deranged
I have existed for years
But very little has changed
I’m the tool of the Government
And industry too
For I am destined to rule
And regulate you

I may be vile and pernicious
But you can’t look away
I make you think I’m delicious
With the stuff that I say
I’m the best you can get
Have you guessed me yet?
I’m the slime oozin’ out
From your TV set

You will obey me while I lead you
And eat the garbage that I feed you
Until the day that we don’t need you
Don’t go for help . . . no one will heed you
Your mind is totally controlled
It has been stuffed into my mold
And you will do as you are told
Until the rights to you are sold
That’s right, folks
Don’t touch that dial

Well, I am the slime from your video
Oozin’ along on your livin’ room floor
I am the slime from your video
Can’t stop the slime, people, lookit me go
I am the slime from your video
Oozin’ along on your livin’ room floor
I am the slime from your video
Can’t stop the slime, people, lookit me go

[xp38]

When there is FR! :)

[Vendome]

They can always take more ads from Corona

That seems to sell

[Vendome]

The good news is the fkrs will have to pivot to something more important soon but, probably won’t until September when the full campaign season is in full swing

[mt tom]

dominos don’t need to advertise ordered 2 pizza Sun ate two pieces threw the rest in the trash wont order again

[Captain Peter Blood]

I knew that this would happen and the MSM and Cable networks would end up in trouble. Lets see what happens when a lot of those high priced news people have to take a salary cut.

[mowowie]

I just spent something like 5 hours watching
“Las Vegas Jailhouse” on youtube.

Made me wondering why i pay so much for cable..

The women that work there are so pretty and nice it almost makes me want to get PC’d next time i go there...
:)

[Kickass Conservative]

I was being facetious. #;^)

[Keyhopper]

NO MO INFO WHORES

[minnesota_bound]

I wonder if the actors will be making $1 million an episode anymore?
There are so many more venues now that I suspect the actors will want a piece of it all and may make far more.

Example the tv show Friends ended in 2004 and last year sold for $500 million to HBO Max for 5 years of streaming.
Big Bang Theory ended 2019 and the streaming rights sold for $600 million for HBO Max and TBS (how long?). $500 million for Seinfeld to Netflix (how long?).

They sell and resell the shows endless times.

[pabianice]

Haven’t watched any commercial TV since Netflix.