BRINGING ADDRESSABILITY TO TV CONTENT ACROSS DEVICES
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- Jack Charles Berry
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1 BRINGING ADDRESSABILITY TO BRINGING ADDRESSABILITY TO TELEVISION: WHAT S POSSIBLE NOW A PRIMER FOR TV ADVERTISING IN 2018 Television today exists in many different forms. Traditional linear via cable or satellite; mobile; over-the-top; TV Everywhere. Yet, what might be a seamless move from screen to screen for consumers, can actually be quite complicated behind the scenes for advertisers. From high-indexing linear programs to one-to-household placements, from IP to cookie-based web viewing, TV advertising options have expanded well beyond the age/gender buying standards popular for many decades. This Knowledge Lab examines how advertisers are bringing addressability to television today in all of its incarnations. It delves into the different approaches and how they work, and helps clarify what levels of targeting and measurement are possible for each. INTRODUCTION: KEEPING A WATCH ON TV ADVERTISING IN ALL ITS FORMS In the past few years, TV advertising has undergone an industry-changing transformation. While Americans still watch an average of four hours of television every day, many of the ads we re seeing are being delivered in totally new ways: data-enabled TV strategies allow advertisers to reach high-indexing strategic audiences with more relevant messages; Addressable TV (a close cousin to data-enabled TV) takes this a step further and lets advertisers reach consumers on a 1:household basis; meanwhile, Connected TV offers the lean-back TV experience with digital-centric data delivery. And then there s the television that s not being watched on a television, but instead on a phone, a laptop, or a tablet. Is this all still TV? Absolutely. But it means something completely different to advertisers regarding their ability to reach consumers and measure outcomes. As marketers strive to bring greater addressability to TV in all its forms data, targeting and measurement are the key ingredients to success. As marketers strive to bring greater addressability to TV in all its forms data, targeting and measurement are the key ingredients to success. Building profitable TV strategies in today s landscape, however, means understanding the unique intricacies dictated by different distribution channels, different systems and different partners. The television may be extraordinarily familiar, but that s no longer the case with TV advertising. It s moving faster than ever. Here s your chance to get up to speed. Read on for an overview of each of the following TV content channels: Data-enabled Addressable Connected TV Content TV Linear TV TV Consumed on a PC TV Content Consumed on a Mobile Phone or Tablet 1
2 BRINGING ADDRESSABILITY TO 1 DATA-ENABLED TV WHAT IT IS In a broad sense, Advanced Linear TV refers to the ability to bring enhanced data and greater automation to the linear TV buying and selling process. Data-enabled TV is a form of Advanced TV that uses data to identify linear TV programming with a high concentration of the advertiser s desired consumer target. HOW IT WORKS Data-enabled TV allows advertisers to reach consumers with greater accuracy than typical linear TV, which is traditionally planned off of age/gender data and inherently includes a level of waste or spill. 32% of agencies and advertisers say they have used data-enabled TV in past 12 months and 63% plan to in next 12 months (Ad Perceptions and Videology, March 2018) With the help of third-party or first-party data, an advertiser is able to identify the strategic audiences they would like to reach using various program s networks and dayparts. This allows advertisers to plan and buy more strategically to achieve their key audience against their KPIs and desired results. From a consumer point of view, a data-enabled TV ad appears exactly as a traditional TV commercial would during programming. TARGETING By planning and buying directly off of the strategic target, data-enabled TV can find a higher concentration of a relevant audience for the advertiser more efficiently. For instance, an auto manufacturer could buy TV programs that index highly for consumers in market to buy a car. As the below diagram demonstrates, data-enabled TV allows an advertiser to purchase the programs, networks, or dayparts with either the highest concentration, or the highest reach, of their desired audience. You will see the circles show a higher number of strategic viewers with less duplication and reduced waste. Traditional Age/Gender Demo Buying VS Data-Enabled, Audience-Based Buying 2
3 BENEFITS By layering first-party and third-party data over television viewing data, data-enabled TV lets media buyers and sellers understand more about audiences than traditional age and gender skews. Television campaigns planned and transacted in this manner can achieve more efficient delivery against a strategic consumer target, lowering an advertiser s effective CPM (ecpm) and helping media companies serve fewer impressions to meet campaign goals. With all forms of Advanced TV, the ability to bring automation to workflows is also a key benefit. Automation in linear TV planning, buying and measurement leads to improved operational efficiencies and automated enquiries for data, audience avails, and pricing. Additionally, because Advanced TV is, in a sense, a digitized approach to linear TV, advertisers have the ability to plan and buy holistically across all linear as well as digital video screens using a commmon data set. A holistic approach allows an advertiser to control reach and frequency across screens, target underexposed audiences through digital channels, and perhaps most importantly, measure results across screens with one consistent view. MEASUREMENT Because data-enabled TV brings a digital data connection to linear TV, measurement can be much more precise, and better linked to online behaviors following ad exposure. In this way, measurement opportunities would go far beyond media metrics like GRPs, allowing the advertiser to tie linear TV exposure to bottom-line results such as: Brand Impact (i.e. awareness, message recall, purchase intent) Digital Actions (i.e. site visitations, onsite actions, or online search) Online Sales or Offline Sales (offline studies via credit card or loyalty shopper card data) VIDEOLOGY S SOLUTION Videology s market-leading DETV TM solution allows us to tie linear TV consumption to a common household ID, and then match exposure to the online, or offline, behaviors of that ID. This allows advertisers to better manage reach and frequency between both types of channels, including the ability to use digital video to fill in the gaps of linear TV buys. With access to over 60,000 data segments across 26 advertiser categories, as well as approved first-party data, advertisers can find their audience and experience greater workflow efficiency with audience creation, plan generation, execution, and reporting all within one platform. Videology s data-enabled TV planning solutions can be accessed via an enterprise platform license, or, advertisers can gain immediate and free self-service access to automated data-enabled planning tools through Videology s DETVGO product. DETVGO is powered by the Videology platform, and lets advertisers accurately target their strategic audience with the full scale and impact of traditional TV. 3
4 BRINGING ADDRESSABILITY TO 2 ADDRESSABLE LINEAR TV WHAT IT IS Addressable TV is a form of Advanced Television advertising that allows marketers to reach consumers at the household level. In other words, two households watching the same television program at the same time can receive different commercials based on the profile of the household. Addressable TV is becoming an increasingly popular form of advertising in today s connected world, and emarketer expects it to be a $3B channel by next year. HOW IT WORKS Like data-enabled TV, Addressable TV allows marketers a greater level of targeting that goes beyond age and demo. But unlike data-enabled TV, Addressable TV lets advertisers reduce waste even more by buying directly off of the strategic target on a 1:1 household level. Addressable TV Ad Spending US, $3.04 This is done by partnering with an MVPD (often via an Ad Tech provider) to deliver linear TV ads at the set-top box level. It is important to note that since delivery happens at the MVPD level, and since MVPDs currently only have the rights to sell two minutes per hour of local inventory, addressable inventory is more constrained than traditional linear inventory. $ % 2015 $ % 2016 $ % $ % % 2019 To the consumer, the experience of watching an Addressable TV ad is indistinguishable from a traditional TV commercial, except that it should be much more relevant to them. Billions (emarketer, June ) % of TV Ad Spending TARGETING Addressable TV advertising allows for the most granular targeting in linear TV. Using third-party data or their own first-party data, an advertiser can reach their audience with the most relevant messaging. Unlike traditional TV, which focuses on a selection of programming, Addressable TV allows advertisers to reach just the households that fit the profile of their strategic target. Traditional Age/Gender Demo Buying VS Addressable TV Buying 4
5 BENEFITS In addressable TV, it s all about precision. Through more efficient delivery of the strategic audience down to the 1:1 household level, advertisers can expect more targeted delivery of media impressions. By buying at the 1:1 household level, addressable TV is able to eliminate more waste than data-enabled TV. So while absolute CPMs are generally higher on addressable than on traditional or data-enabled TV buys, effective CPM (ecpm) for appropriate advertisers can be highly efficient. In addition to the high levels of targeting, Addressable TV offers many of the same benefits as data-enabled TV, including the important ability to measure results across screens (Please refer to the data-enabled TV benefits section on the previous page for more.) MEASUREMENT By bringing the benefits of digital to linear TV, Addressable TV allows richer measurement opportunities than traditional linear TV. Similar to dataenabled TV, measurement can span a range of categories, including: Brand Impact (i.e. awareness, message recall, purchase intent) Digital Actions (i.e. site visitations, onsite actions, or online search) Online Sales or Offline Sales (offline studies via credit card or loyalty shopper card data) VIDEOLOGY S SOLUTION Working with Videology, TV buyers are able to apply both first-party and third-party data to their linear TV buys to reach consumers at the household level. This is achieved through direct integrations with household graphing partners, allowing us to link linear TV audiences to digital audiences, targeting them by interests, behaviors, online actions or more. Addressable TV advertising can then be measured using the same metrics available in digital advertising including brand lift, on-site actions, or even offline sales and then tied back to a converged video plan to ensure efficiency and the highest ROI possible. 5
6 BRINGING ADDRESSABILITY TO 3 CONNECTED TV WHAT IT IS A Connected TV refers to a television connected to the internet. Today, 20% of digital video viewing is done using a Connected TV device. There are several ways a TV can be connected to the internet: Via a built-in capability in the TV itself (known as a Smart TV) Through another device such as a Blu-ray player Through a game console such as an Xbox Through a device such as Apple TV, Roku or Chromecast It s estimated that the number of Smart TV users will grow steadily in the years ahead, as more new TVs are sold with internet capabilities built-in. HOW IT WORKS In many ways, once a program is selected on Connected TV, consumers are having a TV-like experience, gathered around a TV set, watching a full-sized screen. However, the ad experience is a bit different Connected TV Users US, Video advertising in Connected TV occurs during the in-app experience. For example, if a Connected TV user opens an app such as Crackle to watch an episode of Seinfeld, a :15 or :30 video ad would play prior to the content starting. In this way, the experience is similar to a pre-roll ad watched on a laptop or mobile phone, but the viewing experience is more like a linear TV ad. 51.5% 55.1% 56.7% 57.3% 57.7% For Full Episode VOD content (e.g. a live sporting event), Ad Pods might also appear via midrolls throughout the content, simulating the linear TV experience even further. Watching this type of content via a Connected TV works quite differently from a technical perspective: a live stream already has a set of ads included into the content stream; so, those ads are either left in the stream as is, or those ads can be dynamically replaced in realtime. The replacement of the existing ads in a live stream requires additional technology, Digital Ad Insertion (DAI), to make that happen Millions % of Population (emarketer, June ) 2021 TARGETING The data used to target Connected TV ads to consumers can be sourced from 3 buckets: Authentication Data In this scenario, an app, such as Hulu, would use the anonymized registration data tied to a user s account when authenticating against the Hulu app. Another approach is for app owners to tack on additional data to their users via partnerships with 3rd party companies like Experian. Device Owner Data In this example, a Connected TV app (publisher) would use privacy-compliant data available by the device via an SDK (Software Development Kit), based on information a device owner has provided. For example, Roku has built an advertising framework that allows advertisers to enable consumer targeting and frequency capping solutions. Properties of the Request This bucket utilizes data obtained via the different properties of an ad request in a privacy-compliant manner to reach their desired audience. Unlike the other two solutions, the data used may not always be consistently available. Examples include using content meta-data as a proxy audience (like traditional linear TV targeting) or using an IP address to provide a key for data lookup. 6
7 BENEFITS Connected TV offers the targeting of digital, with the lean-back experience of TV. In other words, when a consumer watches Connected TV, they are experiencing it in the same way they would watch linear TV on a big screen, likely relaxing on their living room couch or their bed. When compared to the small mobile screen, a Connected TV ad is more immersive and relaxed, and often delivers higher completion rates than computer/laptop or mobile viewing. When compared to traditional TV, Connected TV provides an opportunity to reduce waste with greater targeting opportunities. As a digital-based medium using data sets common to other digital devices, Connected TV also provides the ultimate opportunity for optimized cross-device strategies; however, Connected TV inventory must continue to grow in scale to take full advantage of the crossdevice opportunities that are possible. MEASUREMENT Because it is a combination of the TV experience with digital targeting, measuring success in Connected TV can be challenging for some advertisers. Today, Connected TV is seen as a digital screen, similar to a laptop or a mobile screen, and is reported on as such (impressions, reach, etc.); advertisers also have the ability to take measurement a step further with Sales Attribution or Brand studies. But the challenge with considering Connected TV a digital screen is that it doesn t account for the multiple viewers that may be watching a TV set, versus a laptop or mobile phone that most likely just has a single viewer; for this reason, some in the industry are moving towards TV-like measurement. While there is still work to be done when it comes to Connected TV measurement, it appears the industry is actively working on solutions. In the end, the approach may look like digital, or it may look like TV, or Connected TV-specific measurement metrics may develop over time and become a new standard with additional benefits. VIDEOLOGY S SOLUTION Videology sees Connected TV as another opportunity for advertisers to bring advanced data sets to consumers in a TV environment. And interest from our platform users has skyrocketed in fact, over 60% of the campaigns Videology ran in Q4 employed some Connected TV inventory. Over 60% of the campaigns Videology ran in Q4 employed some Connected TV inventory Videology also has many solutions to allow for addressability via household IP address on OTT or Smart TVs, including a first-to-market partnership with Tru Optik. With these products, Videology s clients can target specific OTT audiences by onboarding their first-party data or by leveraging third-party data from dozens of leading providers. Our solution is also privacy compliant with the NAI Code of Conduct, and makes it easy for consumers to opt out of OTT targeting. 7
8 BRINGING ADDRESSABILITY TO 4 TV CONTENT CONSUMED ON A PC HOW IT WORKS WHAT IT IS emarketer estimates that in, over 2.1 million consumers cut the cord. This is because almost all TV content is now available for consumption through digital channels. Many people choose to watch their favorite shows on their laptops or desktops, either through network websites (i.e. ABC.com), fullepisode players (i.e. Hulu.com), or through their cable provider. This type of content is known as Full-Episode Programming (FEP), and refers to TV content on the web that is TV-length (typically minutes, but can be more.) This differs from small clips of a TV show that may circulate the web, or become viral on Twitter and websites like Buzzfeed. Advertisers looking to run spots in PC-based TV programming will find they have most of the same opportunities as they do with any other digital video advertising. They can target using third-party or first-party data, and they can measure with unique precision (more on both below.) For a consumer, the advertising experience on PC-based TV content will feel a little like digital video, and a little like TV. Similar to digital video, the ad loads will be small and the ads will be highly targeted and relevant; but, like TV, the ads will appear in pods, and the content distributors are expected to take considerations into account such as running competitive ads within the same pod. TARGETING PC-based TV programming provides the richest ground for targeting among all of the approaches discussed in this piece. Unlike traditional or advanced TV, PC-based TV content is generally only watched by one consumer at a time, and as such, can be 1:1 targeted with great accuracy. Because PC advertising is cookie-based, advertisers have the ability to truly understand who their audience is in a privacycompliant, anonymized way. They can reach their audience using sophisticated targeting that may be based on third-party data integrations, or by bringing in their own first-party data. Cookie-based PC targeting also allows an advertiser to connect the dots among multiple devices, even linear TV, to ensure they are reaching their audience as effectively and efficiently as possible across screens. BENEFITS By running advertising on laptops and desktops, advertisers are able to reach consumers who may not own or frequently watch a TV (usually a younger audience.) With the right integrations in place, it is even possible for them to fill in the gaps of their TV advertising by targeting consumers who have been underexposed or lightly exposed to their TV ads. US Cord-Cutters (millions) Digital targeting on a PC provides scale but also accuracy. While very broad-interest brands may find TV most effective, niche brands may turn more heavily to digital video to reach the TVwatching audience there MEASUREMENT In today s digital video world, advertisers can measure success in a range of ways, from Media Metrics (i.e. CTR, click-through rate) to Brand Metrics (i.e. purchase intent, brand favorability) to bottom-line business metrics (i.e. offline sales or online actions.) For more on measurement opportunities on PCs as well as TV, visit our Knowledge Lab on the topic of TV & Video Ad Measurement. 8
9 VIDEOLOGY S SOLUTION Videology offers robust solutions for bringing data to the targeting, execution, and measurement of digital video advertising in premium TV content. Our solutions let advertisers buy, manage, and measure premium digital video advertising alongside all other linear TV and digital video advertising. With Videology, PC measurement doesn t end at the computer. Advertisers can tie together video consumption from PCs to TV panels, set-top boxes, mobile phones, and more through a common household ID. In this way, the advertiser can truly see how multiple elements of a campaign work together to drive success. 5 TV CONTENT CONSUMED ON A MOBILE PHONE OR TABLET WHAT IT IS Today, more consumers than ever are turning to their mobile devices both phones and tablets to consume TV content via an app or through a web browser. emarketer estimates that there are over 180 million mobile video viewers in the US today, and expects that number to reach 200 million in the next two years Mobile Device Video Viewers US, HOW IT WORKS TV content on a mobile phone can be found in two ways: through an app like Hulu or CBS Mobile, or through a browser like Chrome or Safari. If an ad is shown inside a mobile web browser, then technology solutions can use the same cookiebased targeting solutions used in desktop advertising. Because cookie-based solutions have already been discussed, this section will focus on in-app mobile TV content only. 81.7% % 84.3% 84.6% % 2022 Today, most mobile users prefer to watch TV content within a TV Everywhere app because it provides a much friendlier, easy-to-navigate consumer experience; examples might include apps like WatchESPN, or the NBC App. Millions % of Digital Video Viewers (emarketer, Februrary 2018) In mobile apps, ads typically appear in ad pods before, during, and/or after their video content. Mobile apps will generally have fewer commercials than traditional TV another reason some consumers may prefer mobile TV viewing over traditional TV. TARGETING In app-based mobile advertising, brands can use third-party or first-party data to reach their audience in the same way they would with other video advertising types. Because a phone is always with the consumer, mobile advertising also provides an opportunity for location-based advertising (in a privacy-compliant way) that is not possible on other devices. An example of this would be a fast-food restaurant targeting people with ads who are close to a location, or using data about previous store visits to target a specific ad. The challenge for mobile advertisers falls in the delivery of ads: When mobile video ads are shown in-app, delivery requires knowledge of the mobile device ID, which, unlike cookies, must be obtained by the app publisher. Additionally, because device ID data is different from typical cookie data, it must be stored a different way in a data management platform. 9
10 BRINGING ADDRESSABILITY TO BENEFITS Mobile advertising provides an opportunity for advertisers to reach their audience on-the-go with a high degree of targeting as well as one-on-one engagement. The fact that a mobile device is always with a consumer provides unique applications to both targeting and measurement. Geotargeting can be used to deliver location-based ads to a consumer, including stores that may be nearby. The location element is also key for measurement, as marketers trying to drive a consumer to visit their brick-and-mortar stores can track 1-for-1 how their advertising performed (more on that below.) MEASUREMENT In mobile advertising, the same vast measurement opportunities available on other digital devices are available, including business metrics like brand, sales, and site engagement, as well as media metrics like CTR. Mobile advertising also provides the opportunity to measure foot traffic, and determine if a consumer who received an ad on their smartphone (or other device), visited a specified location following exposure. Examples of this would include a retail store or automotive dealer measuring visits following ad exposure. VIDEOLOGY S SOLUTION For advertisers leveraging the Videology platform, Mobile is another important screen in a smart cross-screen strategy. We work closely with top publishers to reach consumers via their mobile phones in premium environments. In Q4, 98% of campaigns on our platform included a mobile element. This number has been consistently high as more advertisers are seeing the benefits of a videoagnostic approach including mobile. Videology also has the unique ability to link mobile advertising to linear TV viewership. In doing so, advertisers are able to determine the correct Reach and Frequency across all video screens including both online and linear. HOW DATA IS APPLIED TO TV Panelist Match 1:1 Match at Household Level IP Adress or Authenticated User Advertiser ID Cookie Data Enabled TV Addressble TV Connected TV Mobile App Mobile Web Desktop 10
11 WHAT S NEXT FOR TV? While we cannot be certain of the speed of change that continues to transform television viewing, we do know that more change is coming. One need look no further than demographic comparisons to see that younger generations are viewing dramatically more TV content outside of broadcast and cable programming delivered on linear TV (see diagram in sidebar.) Moreover, skinny bundles offered by virtual MVPDs, such as Sling, DIRECTV NOW, and YouTube Live are becoming increasingly popular options. The growth of connected TV apps is also escalating. While this won t mean the end of linear feeds, it will mean increased convergence between traditional TV and video channels. From an advertising perspective, holistic video planning that encompasses all possible screens and distribution channels will become critical to ensuring proper reach and effective frequency of desired consumer targets Gen Z (18-19) Time Spent Watching Cable/Broadcast TV (minutes) 72.3 Millenial (20-36) 97.8 Gen X (37-52) Boomers (53-71) (Adweek, It s a Mobile World, February 2018, via Porter Noyelli) 172 $1.26 Silent+ (72+) Growth in First-Party Digital Targeting Data The effective use of data, targeting and measurement will remain key to successful converged TV and video advertising strategies: Data: As the connective tissue that links audiences to content consumption across devices, the use of both 1st and third-party data will continue to grow (see sidebar). The need to break down data siloes, and carry data across devices, content and distribution channels, will be critical to both targeting and measurement strategies. Targeting: Increasing convergence with digital channels will propel more TV targeting to move beyond age and gender to include first and third-party data. The benefit will be more precise strategic targeting on TV, as well as more cohesive targeting across TV and digital video. Key to this will be the standardization of data segments that can travel across screens and media suppliers. Q1 Q2 Q3 Q4 (First-party data in the Videology Platform, Q4 ) Measurement: In terms of media measurement, convergence will require a common cross-screen delivery metric, whether GRPs or an alternative standard. In addition, greater strategic targeting will shift emphasis from CPM to effective CPM (ecpm) delivery, at least as a supporting metric. Increased data connections will also bring more accountability in terms of business results and ROI. By connecting exposure to advertising throughout the marketing funnel from awareness building with TV or CTV, right through to digital conversion via mobile or PC advertisers will have a unified view of the consumer, allowing them to see the contribution of each medium to sales lift. Connections can also be made to offline sales with similar accountability. When considering what s ahead for TV advertising, one must also consider the legacy and size of the current TV marketplace. TV advertising in its current form has worked well, and continues to, for many marketers. Change up to this point has come slowly. Yet, as viewing continues to shift across screens, we do appear to be at an inflection point in terms of advanced TV advertising adoption. In fact, 79% of advertisers and agencies said that they plan to use advanced TV in the next 12 months, and more than half expect that within 3-5 years, more than half of total TV buying will be programmatic.* The speed with which TV advertising migrates to data-driven, technologyfueled strategies remains to be seen. The tools to help advertisers bring greater addressability to their TV campaigns, however, are here now. We hope this primer helped to explain the current advanced TV landscape and how these strategies can help drive better results for advertisers. Past/Next 12 Month Usage of TV Content Ad Types Linear TV (cable or broadcast) OTT/Connected TV Full Episode Player (FEP) Data-Enabled TV/Addressable TV (Net) Addressable linear TV Data-enabled Data-enabled linear TV linear (DETV) Used Past 12 Months 32% 46% Plan to Use Next 12 Months 55% 53% 57% 70% 71% 67% 65% 63% (Advertiser Perceptions Study commissioned by Videology, March 2018 ) 78% 79% *Advertiser Perceptions Study commissioned by Videology, March
12 knowledge lab BRINGING ADDRESSABILITY TO ABOUT VIDEOLOGY KNOWLEDGE LAB Videology Knowledge Lab is an educational series meant to shed light on the key topics impacting advertisers and agencies in today s video advertising world. These byte-sized pieces will provide definitions, data and straightforward explanations of complicated subjects, to bring simplicity and clarity to an otherwise complicated industry. If you have questions or comments, please knowledgelabs@videologygroup.com. FOR A DOWNLOADABLE VERSION OF THIS INFORMATION, PLEASE VISIT 12
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