TV Measurement Is about the Big Picture No Matter the Size of the Screen

The promise of addressable TV advertising has been tantalising advertisers and broadcasters for the past few years, but turning it into a reality has felt like a long and drawn out process. It’s also been confusing. Expressions like ‘addressable TV’ tend to be interchangeable with ‘advanced TV’, and other terms like connected TV, video on demand and OTT are also bandied about. 

So, as we head towards the end of 2018, have we really got closer to that addressable TV dream? If we define addressable TV as anywhere someone can get TV-style content and be served different ads according to their profile – then we’re getting nearer. It’s especially in the area of OTT services (i.e. over-the-top media services such as Sky, Netflix and Roku) where personalised ads are coming closer to reality. So what’s changing that could make addressable / OTT TV advertising mainstream?

A positive shift in viewing habits

One of the biggest factors has been the huge shift in how we consume TV, with streaming services like Amazon, NOW TV and Netflix overtaking traditional pay TV for the first time this year, suggesting that we have gone beyond the peak of traditional TV viewing. Especially when you consider how much of this viewing of TV content is being carried out on small screens rather than big ones. 

We are seeing more people become 'cord-cutters', cancelling pay TV subscriptions in exchange for streaming services, and an increase in 'cord-nevers' (the generation of viewers which bypasses satellite and cable TV altogether), so the appeal of an alternative, more targeted approach for reaching these valuable, hard-to-reach audiences while still harnessing the undeniable power of TV advertising is huge.

Big industry moves like AT&T’s merger with Time Warner, Disney’s acquisition of 21st Century Fox and Comcast’s recent successful bid for Sky are also shaking things up as they are likely to lead to a significant increase in the volume of addressable TV inventory.

Not forgetting the perennial issue of the Google and Facebook duopoly which is driving advertisers, agencies and broadcasters alike to look for alternatives to reach targeted audiences at scale in a highly viewable, quality and fraud-free environment. 

However, consumer consumption of addressable TV services continues to far outstrip the market for addressable TV advertising. Using the US as a benchmark, eMarketer predicts that 55% of the population in 2018 are users of connected TVs (just one of the devices for delivering addressable TV), but addressable TV advertising only accounts for 3% of total US TV spend.

So, what’s stopping the power of addressable TV advertising being unleashed? While the likes of Amazon and Netflix don’t carry ads (yet!) this is holding back potential. However, in addition, there are two other significant barriers - complexity and the lack of a common audience currency. 

A fragmented landscape

There is no denying the fragmented nature of addressable TV, with inventory stretched out across a variety of industry players – not just broadcasters but the various OTT media and streaming services, set-top box and smart TV manufacturers amongst others. For advertisers and agencies used to buying TV in neat bundles, working with so many players to buy media space can feel daunting. Plus there is currently no coherent exchange for addressable and OTT TV inventory in the UK, although adtech companies are setting out their stores to enable buying and selling of addressable TV.

Like-for-like cross-device measurement 

To date it’s been impossible to overlay and dedupe between the different addressable/OTT TV inventory providers or to measure like-for-like. This is not just because of the fragmentation but also because some of the large providers are protective of their inventory and trading position - so enabling measurement by third parties isn’t top of their play-book. 

This is why as yet there has been no common currency for addressable TV or a common agreement on enabling measurement – and the big industry hope, Project Dovetail, which looks set to address this problem, still appears to be some way off. 

It is a serious issue for anyone hoping for OTT TV advertising to make it big. Today’s senior marketers (and auditors) are not taking any nonsense.  For them, digital is part of their DNA and they see measurability and transparency no longer as nice-to-haves but must-haves. Without a common currency to evaluate and trade addressable TV advertising, it’s long term potential may be stifled. 

In fact, what is important is not just being able to measure addressable TV, but to measure it across all devices and media in the same way as all the other digital channels to provide a true understanding of cross-channel net reach and therefore better drive effectiveness. 

Collaboration is key

So how can we make this happen? At AudienceProject we are championing the use of an agreed panel across the emerging addressable and OTT TV media channels, created through collaboration between all interested parties. There is already a spirit of co-operation in the industry. For example, Sky, ITV and Channel 4 came together earlier this year to champion TV advertising plus, and Carolyn McCall’s recent ‘rallying cry’ to the TV industry to build a Netflix rival together, was noteworthy - albeit from a content perspective. 

However, the recent news that Facebook is pulling out of its connected TV ad network suggests that there is also currently an element of protectionism in the sector. The big broadcasters are making a big push around building up their own inventory and want to keep all the revenue for themselves.

Regardless, longer term, it is in the key players’ commercial interest to collaborate and allow third-party measurement and sharing of their non-linear viewing data so that their nascent collaboration can be as fruitful as possible. 

There will be direct benefits for them in doing so. For instance, much of their content viewing, especially amongst harder to reach cord-cutter audiences, is currently going unmeasured. In advertising, if you measure it, you can (up)sell it. 

More important than this, though, is the bigger picture. Once advertisers can implement multichannel campaigns across TV and digital through a common data lens and understand the ultimate effectiveness mix for driving sales – that’s when addressable TV will come of age. The ability to deliver highly personalised experiences for each and every consumer through both digital and TV delivers a serious alternative to Google and Facebook’s offerings. 

Martyn Bentley is commercial director UK at AudienceProject