Weak ad markets give TV networks an opportunity to clear ad debts with advertisers

New Ideas in MarketingEssential news for marketers, summarised by YouGov
June 12, 2020, 1:57 AM UTC

Ad supply is currently surpassing demand.

With COVID-19 impacting ad demand, TV networks are leveraging weak ad markets to deliver existing ads owed to advertisers that failed to reach an agreed-upon number of people. In a normal market, TV networks would struggle to settle these liabilities, as they would have to balance between owed inventory and the inventory they could sell.

Pursuing advertisers to agree to “make-good” is proving challenging, as these packages do not include what was originally paid for. For example, absence of live-sports has led some advertisers to refrain TV networks from running their ads.

However, some advertisers are allowing networks to settle their debts. There have been situations where TV networks negotiated to forgo a proportional portion of their liabilities with advertisers wanting to pause campaigns.

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