As writers’ strike draws to a close, ad industry expects some behaviors to stick

The Writers Guild of America (WGA) has reached a tentative deal with Hollywood’s top studios on a new contract, paving the way for a nearly five-month long strike to end.

The agreement meets most of WGA’s demands, according to reports, including increases in royalty payments actors receive for streaming content as well as guardrails against the use of artificial intelligence. 

After 146 days on strike, the WGA suspended picketing on Sunday and said its leaders may end the protest as soon as Tuesday once the final contract is finalized and sent to members for a vote. 

However, this does not mean an immediate return to normalcy for TV and movie production, since the actors union SAG-AFTRA has been striking separately since July 14. While the SAG-AFTRA’s demands go further than the WGA’s, the deal could help move negotiations along.

Now that a conclusion is nearing, Campaign US asked media buyers and TV experts what impact the strikes have had on advertising spend so far and what impact they expect the monthslong production pause to have on TV buying in the next year.

Brian Wieser, principal, Madison and Wall

I don’t think the resolution makes a significant difference, certainly not without the actors coming to an agreement. There’s some extra new content that can now come out — talk shows, for example — but that’s a relatively small part of the industry. 

Although the additional new content will be welcome by advertisers, even if everything was back up and running there would still be many challenges for the TV industry to overcome.  

The ongoing shift of consumption to ad-free and ad-light streaming environments will continue to make it harder for advertisers to satisfy their reach goals, and at the same time, they continue to shift budgets into digital platforms where professionally produced content is relatively scarce to start with.

Hunter Terry, general manager of CTV, Lotame

While writers were on strike, Americans were still on couches. Yes, TV production may have altered during the strike and the average person may have been upset that their favorite series was paused indefinitely while Hollywood battled it out. Nonetheless, people continued to consume TV content voraciously.

This situation has spurred changes for streaming services to keep eyes on them, causing streamers to put more emphasis on live sports and other non-scripted content. YouTube has gained traction with YouTube TV as Americans love watching other Americans produce their own content. But Hollywood will always have a place in people’s attention, and so expect the average TV viewer to shift their attention back to mainstream series when they begin to air fresh content in the coming months. 

While this change over the last few months has necessitated a change in ad buying, spending on TV is not going to go down, and CTV specifically continues to take more and more ad dollars. It remains the largest growing channel for digital ad buying and will continue to maintain that position for years to come. As long as there are eyeballs watching TV, advertisers will find a way to spend money on ads.

Stacey Stewart, US chief marketplace officer, UM

We are thrilled that the writers have reached a tentative agreement and are cautiously hopeful that we will see the SAG-AFTRA strike get resolved soon as well, since the two are so intertwined. 

As for spend, we have seen pockets of dollars pulling back and a shift to sports and streaming — given the bank of content there — but not massive cuts as a result of the strike. With news of the writers agreement, we should see late night and some daytime talk shows return soon.

Kelly Metz, MD of advanced TV, Omnicom Media Group

While the WGA resolution is good news for the industry, we're not likely to see more money coming back in until the SAG-AFTRA dispute is resolved. However we do expect the launch of Amazon Prime Video ads to spur activity in the meantime.

Andy Rhode, head of media, Fallon

In many ways, we expect the response will be slow. So much of the money for Q4 and even Q1 is spent at this point — and most shows won’t immediately restart — so, there will be a lag to any obvious response. 

Additionally, the fall TV calendar is so filled with sports, especially once we get into October, that sports may also hide any of the big impacts to scripted and even unscripted programming.

The big question to me is whether we see a drop in viewership across some of the content made during the strike, or before new post-strike content can get live. If viewership went down, will those people come back to TV, or is that going to be one of the long-term costs of this? 

Regardless, I think we’re going to see a shift to addressable buying that doesn’t go away. With fewer and fewer marquee programs and monoculture moments, TV buyers are going to be more interested in the right eyeballs than just the right programs.

Maura Pierson, senior director of media strategy, Wpromote

The length of this strike combined with continued economic uncertainty resulted in some significant doubts around this year’s upfronts and opened up a lot of conversations about the best way to use ad dollars.

More flexibility is a core part of the OTT value proposition. The current turbulence and bigger forces — from the economy to the rise of additional ad channels — have forced a reckoning for advertisers.

Right now, advertisers have not significantly pulled back on spend, but we have seen

shifts in spend away from linear toward streaming, with both OTT and digital video options like TikTok and YouTube offering more control and flexibility to advertisers. We’ve certainly seen an uptick in interest and investment in creator campaigns on digital when looking at overall branding opportunities.

Sports — the last big playing card on linear — have already started moving onto streaming, which is also lessening the reliance on significant linear TV investment. New opportunities to advertise on big events like the upcoming Olympics and the Super Bowl are the bright spots a lot of advertisers are more excited about exploring.

It’s about balancing the scale traditionally delivered by TV with the level of precision

advertisers have grown to expect from digital. There’s no one-size-fits-all solution for

every advertiser, but the questions we are now asking as media buyers are critical.

They’re forcing advertisers to take a more audience-centric and personalized approach to media buying instead of copy-pasting the same playbook from last year. 

The longer-term impact is going to mainly hit linear; if the studios can come to an agreement with SAG-AFTRA before October, the result is probably going to be a continued slow slide of ad dollars away from scripted linear buys toward over-the-top (OTT) and digital video. Advertisers will likely have more leverage to push for more flexibility in the upfronts and may challenge the price of linear ad buys — particularly in prime time.

If the actors’ strike goes into October, we expect to see a lot more advertisers pull money out of linear and possibly trigger some much bigger changes in how these negotiations play out and what advertisers will demand from studios in exchange for investment. That, in turn, will turn the heat up on OTT and digital video to deliver on connecting the dots between traditional brand metrics and business impact.

Ross Martin, co-founder and president, Known

The ad industry has been waiting for some positive sign here for months, and this is definitely that. Our clients are eager to see Hollywood back up and running. There’s a lot of pent-up, inspiring creative out there, waiting for the floodgates to open. Our entertainment clients are all excited for what feels like an era of growth and innovation again.

The writers’ agreement is a good step in the right direction, but we’re not out of the woods for scripted programming yet. Not even close. Assuming the SAG deal gets done in the coming months, we’re anticipating an exciting year of growth for both our consumer brand clients and our entertainment clients in 2024.

We have not witnessed a pullback in ad spend as a result of the strikes. Our media teams have found more efficient and precise ways to reach and connect with audiences on a variety of platforms. The business objectives don’t change just because the playing field has. We’ve been able to adjust plans for clients who buy on shorter timeframes and for those who prioritize “premium” programming, which requires agencies to be more innovative and predictive than ever.