The impact of the writer’s strike on direct response TV advertising.

The ongoing writer’s strike has left many in the entertainment industry wondering what comes next. With talk shows going off the air and replacement programming uncertain, advertisers are also left in a precarious position.  We'll explore the impact of the writer's strike on direct response TV advertising and what it means for brands trying to reach their target audience.

Now that the strike has started, and due to the lack of writers, late-night talk shows will pause. What happens to the advertisers that rely on hitting that audience at that time? Brand advertisers must look for another avenue to reach this customer base, possibly shifting dollars into Prime or, if purchased as part of an Upfront buy, simply waiting for ADU’s (Audience Deficiency Units) when replacement programming doesn’t meet the rating guarantee. Direct Response advertisers, who rely on that time period, may have to shift their dollars into Overnights, Early Morning, or Day, which could put additional pressure on the marketplace and increase unit rates during key dayparts for the Performance Marketing community. Not all Direct Response advertisers rely on high-priced late-night talk shows as they tend to underperform compared to other dayparts. But the question remains, what will the networks replace their late-night programming with, and will it keep the audience, or a significant portion of the audience, continuing to tune in? 

We have nothing to concern ourselves with if the programming is compelling enough. But if late-night activity stops working, the direct response advertisers who closely track performance will know in a few weeks. The movement will then place additional pressure on the other daypart’s inventory. As an industry, we must be ready for a shift of media dollars from Late Night to other dayparts and adjust our schedules to keep our client’s performance high.   

While CTV continues to cut into linear TV budgets, The direct response industry has struggled with extracting strong CTV performance, compared to linear TV, depending on the target audience we are trying to hit. If we have the right target, linear TV continues to drive strong performance for our clients. We straddle CTV and Linear, here at Lab415, (depending, of course, on the target audience we are trying to reach) and optimize based on the performance of each entity. We can increase performance by employing Linear and CTV while keeping costs low.

Lack of programming (which could compound depending on how long the strike lasts) and high CPMs continue to cause advertisers to straddle linear and CTV. Advertisers that are looking to develop reach quickly also rely on linear TV. The lack of writers could cut into available programming if the strike lingers, driving up CPMs. Of course, some CTV platforms rely on global programming and may increase their purchase of international offerings. This could perpetuate a shift in viewers, amongst the larger CTV entities, as platforms like Netflix rely heavily on international programming.

The direct response television community prides itself on its nimble ability to change schedules to optimize continually. If the writers' strike continues, we must be creative this upcoming quarter to identify new opportunities for our growth clients.

LAB415 is keeping all eyes on this development in the industry and stand behind the writers, who are concerned not only about reduced pay because of streaming TV, but also the ChatGPTs of the world taking over their role.