Tackling the addressable TV challenge

In a report published in December last year, Deloitte Global predicted that addressable TV advertising, which allows different ads to be shown to different households watching the same programme, would generate about US$7.5 billion globally in 2022.

Although a big figure, and certainly a massive increase from previous years, Deloitte Global warned that it is a still small part of the global US$153 billion TV ad market forecast for 2022.

“In short, addressable TV advertising has a long way to go before it’s a major part of the TV advertising landscape. And what can get it there will be its ability to show the same ad to far more viewers, rather than targeting different households with different ads”, the consultancy wrote at the time.

Content Everywhere specialists are certainly hoping to rise to the challenge of addressable TV, and advertising technology in general. Companies in this space have long been launching new adtech products and services that aim to exploit the changes in how we watch TV today, with streaming services on connected TVs increasingly competing for linear TV’s eyeballs.

Oliver Botti, SVP executive sales and innovation director, Global Media BU at Fincons Group, commented that addressable TV advertising “today allows numerous targeting options and enables cross-channel advertising campaigns, together with sophisticated attribution analysis. Measuring campaigns effectiveness, such as through drive-to-store and drive-to-site KPIs, is now key for the commercial take-off at scale.”

Roger Franklin, general manager, full-time business unit at LTN Global, agreed that the industry has been speaking about addressable advertising for some time. “But now we’re really seeing it take off in US markets, with major customers rolling out addressable campaigns as we speak.”

He noted that ad targeting at scale for live television is a significant challenge in a fragmented TV advertising landscape.

“Each TV distribution platform, both OTT and traditional, requires unique advertising workflows and integration with different ad decisioning providers, ad insertion platforms and traffic and scheduling systems is complicated,” he said.

Franklin believes that linear addressable advertising “is a revenue game-changer for TV networks right now”. His company has already launched LTN Target, which is designed to enable “seamless addressable advertising campaigns across live and linear programming at scale and on any platform”.

LTN is also keen to work closely with others in this field. For example, the company collaborates with partners of Project OAR, the consortium founded by Vizio, to establish an open standard for addressable advertising on smart TVs.

Vizio has also since helped launched Go Addressable, a consortium that plans to simplify and scale addressable TV advertising. Other groups attempting to tackle this area include OpenAP, the European Addressable Media Initiative and On Addressability.

Scott Kewley, VP for commercial product management at Synamedia, observed that addressable advertising “presents a huge opportunity for potential advertisers — regardless of size and however niche their product or service — to engage with viewers across a myriad of screens and pin-point specific audiences cost effectively”.

Kewley says one of the key challenges for operators is ensuring the addressable footprint extends across all inventory, including broadcast, catch-up and streaming services, so they can offer advertisers of all sizes an optimised proposition with high targeting accuracy and measurement to help them achieve their campaign objectives.

“Educating both sides of the TV advertising ecosystem is also a critical success factor”, he emphasises. “There’s currently a mismatch between the TV-based buying platform mentality versus the newer digital strategies of the streaming providers. There is a clear need for insight as well as tools to help develop more understanding across platforms.

“And, in this era of premium content production, with broadcast quality content moving to streaming platforms, there will be a need for high-quality digital advertising so we can maintain the appropriate level of ad quality across all platforms. The broadcast environment needs broadcast quality ads, with proper vetting so it doesn’t risk becoming an extension of digital advertising and suffer from the same reputation,” Kewley said.

Synamedia has a strong adtech heritage, and said it has been providing technology to support the advertising eco system for more than 10 years. The company started with the targeted advertising solution, Sky AdSmart, and more recently launched Synamedia Iris, a unified multi-platform ad stack that supports both platform operators and digital players to monetise a wide range of complex platforms.

Good data matters

Tony Mooney, SVP of advertising at ThinkAnalytics, warns meanwhile that one of the challenges facing the adtech sector is that “it feels a bit like the bad old days of direct mail list broking, with too many businesses over-promoting the quality of their consumer data.”

Mooney said many adtech vendors offer audience targeting on their platforms, but it is often based on third-party data or “shallow first-party data with questionable accuracy. The result is that advertisers eschew paying extra for targeting and are continuing to run TV campaigns using broad attributes.”

ThinkAnalytics is taking an approach that it says “enables the kind of behavioural audience targeting on TV that advertisers enjoy on digital, underpinned by accurate, relevant, recent data.”

“Creating detailed behavioural attributes from viewing data is challenging, time-consuming and costly unless you have good metadata and high levels of automation,” Mooney said.

Bart Lozia, CEO of Better Software Group (BSG), agrees that there is a need to shift to a first-party data strategy, especially in an era when the death of third-party cookies comes at a moment of a “widespread backlash against advertisers’ digital surveillance”.

He advises using data obtained directly from customer relationships instead of buying it from a third-party, in order to continue tracking and targeting customer behaviour effectively, to provide the best customer experience (CX) possible, and to future-proof targeting strategies.

“Build your CX strategy around first-party data, obtain consents in user journeys to gather information directly on your platform so you will get the data directly from your UI and then store it internally for your purposes. Use the gathered data to build your own behavioural profiles and sell this data to advertisers,” Lozia said.