It's the television industry's biggest week of the year. Thousands of advertisers flock to New York City's most prestigious venues — Radio City Music Hall, Lincoln Center and Carnegie Hall — to get their first glimpse of the major networks' new fall schedules before agreeing to shell out billions of dollars for TV time.
But the gathering, which kicked off Monday, comes at a troubling time. TV's advertising model is under siege.
"Television advertising in 2017 is in a state of total upheaval," said Steven Amato, chief executive of the digital agency Contend in downtown Los Angeles.
Television ratings have been plummeting and advertisers are loath to pay more money for smaller audiences. Viewers 18 to 49 — the crowd most desired by advertisers — are watching less conventional TV every year, according to measurement firm Nielsen.
Five years ago, 36% of people in that age group watched prime-time TV. But in the current season, which ends this month, that number has fallen to nearly 28%.
Consumers have been seeking ways to avoid ads — signing up for ad-free subscription services such as Netflix and Amazon's Prime Video or digitally recording television shows so they can zip through the commercials.
Reflecting those shifts, spending is expected to be lower during this year's TV ad auction, known as the upfront because the networks sell the bulk of their ad time in advance of the new fall season. Broadcast and cable networks are expected to rake in an estimated $18.2 billion in upfront sales, down 2% from last year, according to investment bank Jefferies.
But network executives are determined to hold on to their pieces of the pie. They are working more closely with advertisers to weave products into the story lines of TV episodes and producing more shows that viewers will watch live.
During its Radio City Music Hall presentation Monday, NBC trotted out big-name stars, including its latest recruit, Megyn Kelly, the former Fox News star who promoted her upcoming Sunday night and weekday morning shows. The network plans to produce the rock opera "Jesus Christ Superstar Live!" on Easter. Fox has high hopes for live versions of "Rent" and "A Christmas Story," the 1983 holiday/cult film.
And ABC is reviving "American Idol," once the most popular program on TV when it ran on Fox, because the show was a magnet for younger viewers and major brands, such as Coca-Cola and Ford.
TV executives also are borrowing from the playbooks of Amazon.com, Google and Facebook that use online browsing histories to serve targeted ads for products that individual consumers might be inclined to buy.
The goal is to augment the Nielsen numbers with more detailed data, gleaned from a battery of other sources, to help advertisers better reach the consumers they want to influence.
So this year, television networks are dipping more deeply into mountains of data collected by pay-TV companies that can track which programs their subscribers watch, social media sites like Facebook and even unconventional sources such as credit rating agencies and the U.S. Census Bureau.
"Media companies are placing huge bets on data to prove the value of television to a greater extent than in the past," said Ashwin Navin, chief executive of Samba TV, a data and analytics firm.
The ability of Google, Facebook and Snapchat to target specific users "has created tons of pressure on the media companies to prove that their commercials still work," said Navin.
Three major media companies — 21st Century Fox, Time Warner Inc.'s Turner networks and Viacom Inc. — this year announced a partnership to create standards for selling advertising tied to these data insights.
NBCUniversal has said it would sell as much as $1 billion in advertising across its cable and broadcast networks during the upfront market by using data metrics other than Nielsen ratings.
"We've gone a step further by saying we're going to guarantee that [advertisers] are reaching the right people," Mark Marshall, executive vice president of entertainment ad sales for NBCUniversal, said in an interview.
Advertisers have been clamoring for more details about viewers, rather than continuing to rely so heavily on the basic demographic breakdowns — age and gender — that Nielsen routinely provides.
Knowing who is watching which shows will help advertisers make more sophisticated decisions. For example, Hollywood film studios — one of the biggest buyers of TV advertising time — would like to appeal to moviegoers. Insurance companies want to know which consumers are ripe for a new policy. And automakers would like to zero in on that suburban mom who drives a 10-year-old Ford and dreams of owning a new minivan.
NBCUniversal is pitching its "audience targeting platform" to help advertisers make more informed choices. The media company has been pushing digital data, in part, because it is owned by Comcast Corp. The Philadelphia cable giant has a treasure chest of viewership data collected from the 23 million homes with Comcast cable TV service.
For example, last year NBCUniversal helped a car company that wanted to find drivers of small SUVs. After sifting through granular audience data, NBC determined that those consumers were inclined to watch shows on the company's Syfy channel.
NBC's ad executives this year will pitch its tear-jerker family drama "This Is Us" as more than a show for women. Network research found that a lot of men were also watching the show, "even if it was because their wife or girlfriend was making them," Marshall said. Using that information, NBC will encourage advertisers who typically buy time on sports and other male-skewing programs to consider putting their money in "This Is Us."
Networks are under pressure to test new approaches as television scrambles to stanch the flow of dollars to digital. In the last five years, the amount of money spent on digital ads more than doubled. According to EMarketer, advertisers spent $36.82 billion on digital ads in 2012. This year, the total is expected to reach $83 billion.
Google's video-sharing website YouTube in recent years has trumpeted its data showing that the site reaches more viewers in the 18-49 age group in one month than any single TV network.
Broadcasters are reminding advertisers that their networks can still attract 10 million or more viewers to a single program.
"Where do the advertisers get the biggest reach and the biggest return on their investment?" asked Jo Ann Ross, CBS' president of advertising sales. "We nail that."
Networks may also benefit from a recent scandal over advertisements on YouTube. Some advertisers on the website discovered that their brand messages had been placed in close proximity to offensive videos, including hate speech and terrorist propaganda. Advertisers were furious, and several — including Verizon, Johnson & Johnson and JPMorgan Chase & Co. — pulled their advertising from YouTube.
YouTube Chief Executive Susan Wojcicki this month apologized at the company's advertiser presentation in New York. She promised that her team was "working around the clock to ensure that your ads show up in the right place."
Traditional television networks hope to capitalize on such missteps.
"You never have to worry about your brand showing up next to something objectionable," NBCUniversal ad sales chairman Linda Yaccarino said. "Television is the most effective medium ever. We know it, you know it and our friends in Silicon Valley know it."
David Levy, president of Turner, which includes CNN, Cartoon Network, TNT, TBS and other cable networks added: "We have premium content that can be trusted."
He added that in some cases, the number of ads that run on individual cable channels would be trimmed in an effort to be more viewer-friendly.
"More relevant ads are a good thing for everyone," said Joe Marchese, the newly named president of advertising revenue for the Fox Network Group, during a presentation at the Beacon Theatre in Manhattan. "We are focusing on metrics that matter."
Lyle Schwartz, managing partner for media buying behemoth GroupM, said in an interview that there is value to the networks' efforts to adjust to new technologies and changing consumers, but the broadcasters should focus on something more basic. He would like to see promising new shows with the potential to be a big hit on the scale of NBC's "This is Us" or Fox's "Empire."
"Certain shows that you put out there seem to bring back audiences that have gone away," said Schwartz. "We have to find more of those kinds of shows."
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4 p.m.: This article was updated with additional comments from the upfront market in New York.