By Layla Zulfa 
Outcome-based buying isn’t coming into the upfront this year, but this could be the year that brings outcome-based buying into the upfront in the coming years.
“I think it’s an iterative process over the next couple of years. I think both the sell side and the buy side have to get a little bit more comfortable with the outcomes and understand them a bit more. It will eventually likely be a currency that we can actually transact upon as the primary currency. But I think we have a little ways to go before that happens,†said Robert Voltaggio, president of advertising sales at Warner Bros. Discovery.
Case in point: Paramount has been testing an ad product called Precision+ “that allows brands to come in and deliver against a specific conversion outcome, whether it’s qualified leads or visits to a website or registrations on a website,†said Leo O’Connor, evp of streaming at Paramount’s advertising division. The company isn’t charging advertisers based on the outcomes Precision+ delivers, though.
“We’re still transacting on a traditional basis, but we are working against a benchmark conversion target,†O’Connor said.
And there’s the key word: “benchmark.†For outcome-based buying to become a reality, benchmarks need to be established. That way TV and streaming ad sellers can charge advertisers based on how ads impacted whatever chosen outcome metric, not based on the raw number of outcomes associated with the sellers’ inventory.
“For the majority if not all categories, the market is not ready for outcome-based transactions as we define it traditionally in digital,†said Evan Adlman, evp of commercial sales and revenue operations at AMC Global Media.
In digital, outcome-based buying usually means someone sees an ad on a publisher’s site, clicks on the ad to visit the advertiser’s website, buys a product or completes some other action and the publisher gets paid for delivering that outcome. But people don’t click on TV and streaming ads (yes, QR codes exist but c’mon). Compounding matters, there can be all kinds of factors affecting outcomes: from retailers insufficiently stocking products in local stores to, say, a world leader starting a war or imposing tariffs and upending the global economy. A smart seller doesn’t want to base its compensation on factors beyond its control.
“The thing we have to remember when we guarantee on outcomes: We can only control so much,†said TelevisaUnivision president of U.S. advertising sales and marketing John Kozack.
Which is why outcome-based buying for TV and streaming advertising is unlikely to mirror digital’s outcome-based buying in which advertisers pay based on the number of outcomes delivered. Instead the transaction will likely be based on outcome impacts, such as sales lift. And that brings us back to the benchmarks that will need to be established are being established.
“Right now being able to provide reporting on outcomes is table stakes, and it’s what advertisers are looking for,†said Adlman.
That outcome measurement is primarily a means of TV and streaming upfront sellers to make brands more comfortable committing money because they’ll get a clearer read on what their budgets bought them in terms of business results. But those outcome measurements also create the historical baselines, or benchmarks, upon which outcome-based buying enters the upfront.
“For something to become currency-grade, so to speak, so that we are actually trading on it, it takes time, and it takes a lot of learning. And that’s why we’re in beta on this [with Precision+],†said O’Connor.
What we’ve heard
“The sellers have acknowledged that budgets are down, and now they’re basically saying, ‘I’m not going to cave on my pricing, I’ll take my chance, I’ll write as much as I can in the upfront, and then I’ll do the rest in scatter.’â€
— Ad buyer
Numbers to know
<-10%: Percentage year-over-year decline in upfront dollars being committed by some advertisers this year.
99.1: Number of minutes each day that the average YouTube account spends watching the Google-owned video platform.
What we’ve covered
The upfront has started to move, as sports leads the way again:
Read more about the upfront here.
Coca-Cola’s AI-powered José Mourinho campaign could signal a shift in celebrity partnerships:
Read more about celebrity partnerships here.
How agencies are betting on entertainment to survive:
Read more about agencies and entertainment here.
YouTube’s AI remix push exposes a looming reckoning for the creator economy:
Read more about the creator economy here.
Why creator Lola Torres prefers the stability of affiliate marketing over brand partnerships:
Read more about affiliate marketing here.
What we’re reading
Scott Pelley’s exit interview:
The former “60 Minutes†correspondent spoke out on his firing and Bari Weiss’s stewardship of CBS News in an interview with The New York Times.
Accenture Song’s Whalar acquisition:
The consulting firm has agreed to buy influencer marketing firm Whalar, the latest in a string of ad agencies/consultancies buying their way into the creator economy, according to Adweek.
Paramount’s cancelation of “The Late Show†and dismantling of “60 Minutes†may not have a big effect of its upfront haul as advertisers move away from late-night TV and news, according to Variety.
Telemundo’s World Cup non-ad breaks:
The World Cup’s new hydration breaks will give broadcasters slots to insert ads, but NBCUniversal’s Telemundo won’t be taking advantage of the opportunity, according to Sports Business Journal.
YouTube Shorts’ brand-safety win:
The Media Rating Council accredited YouTube Shorts for brand safety, the first short-form video platform to earn the recognition, according to MediaPost.
Basiran 
Ali Ikhwan 
Lina Irawan