What CMOs need to know about addressable TV right now

We explore the onset of addressable TV, Australia's first total TV measurement and reporting system, and the hurdles and opportunities advanced TV advertising presents to advertisers

Figuring out what addressable TV is – and isn’t

But while addressable TV opens up an ability to target audiences, is data-driven and connected, it’s a big mistake to lump it as a new digital channel. In fact, getting people to abandon hard-won digital learnings has been a real issue for the team at Finecast.

“People working in digital have tended to jump to the fact that given TV is a ‘digital’ offering now, they should put retargeting in or show you the ad on addressable TV if you’ve visited the website. That doesn’t really work on a big screen you’re sharing with other people,” Poole pointed out.

Another big realisation is ‘digital’ data isn’t necessarily useful in an addressable TV environment. As Poole explained, digital data tends to be personal information, such as browsing history or something tied to the individual. But in a shared viewing environment, you want household data and trends.

“As the saying goes, when you have a digital hammer, everything looks like a digital nail,” he said. “Addressable TV isn’t it.

“We do a lot of brainstorming where digital use cases come up and die very quickly.”

Poole instead compares addressable TV to outdoor media planning and buying, and even traditional TV location-based buying. Key data sets include location, sales and transactional information and trends, and broader audience types.

What’s more, no one expects addressable TV to become a one-to-one platform.

“The benefit of content broadcasters make available – whether it’s drama, sport or news – is it gives high-velocity reach and getting to lots of people, quickly,” Portrate commented. “I can’t see broadcasters coming down to a one-to-one level, as it undermines the value proposition of the channel. But what it can do is give you a segment of 50,000 people, as opposed to 1 million, if those are the people you want to talk to.”  

Because addressable TV can be measured across any device, it also doesn’t detract from concurrent campaigns, either brand or performance, Portrate said.

“It’s a complicated funnel these days, so this is an opportunity, depending on your objectives, to either complement big brand work happening on broadcast or as an SME, to use video to communicate and talk to a large group of people not accessible to you in the past,” she added.

Short-term versus long-term thinking

It’s for these reasons industry pundits don’t see addressable TV triggering the same short-term thinking applying to digital and performance media.

“There is that capability, but there’s also an acknowledgement TV content is different; the attention and innate nature of the content drives stronger attention,” Portrate argued. “I do think it will enable advertisers to use broadcast in the middle of the funnel, but I don’t see it as a performance-based activity.”

Poole is equally cautious around those wanting to use addressable TV like a scalpel. “In our opinion, TV is for branding. Addressable takes you further down the funnel towards the middle. But it’s also got to be at scale,” he said.  

“We’ve done 25 or 30 brand life studies for exposed versus non-exposed… it may not be a surprise but this works similarly to traditional linear TV in terms of brand uplift.”

TVSquared Australia-based business development director, Praful Desai, said addressable TV helps reduce the wastage factor experienced with linear TV. But again, he doesn’t see this resulting in brands taking a short-term approach.

“The direct-to-consumer brands are more ROI or cost-per-response driven, but with the big brands it’s about an opportunity to talk more specifically with specific advertising and strategic creative,” he said. “You can still have traditional measurements for top of mind, brand tracking and so on. But you can reach your core target audience more effectively than you did with linear TV.”

Addressable TV: The challenges still to climb

Even if VOZ proves out everything it promises, addressable TV isn’t assured mainstream footing. One challenge is uptake from advertisers, although Gillett expects the larger brands will follow early adopters once there’s some evidence within the marketplace that “it doesn’t matter if it’s linear or addressable TV, it’s just advertising on a screen that delivers business performance and effectiveness”.

Transparency is another necessity, and that comes back to data. Gillett admitted GDPR has inhibited advancement in Europe, but suggested plenty of ways to address this data sharing issue if people are willing to be responsible.

“You have to have different data sources available to different people to be able to measure clearly and transparently,” Gillett said. “Consolidation of data and wanting to work as part of an ecosystem between network, brand and agency is imperative to getting measurement right. And if you get that right, it opens all sorts of opportunities to optimise TV across all screens to get a better business return. Then everyone wins.”

Then there’s shaking up the TV planning process itself, which hasn’t changed in decades. Confusion about where addressable TV sits in the funnel, and the marketing budget, are sizeable obstacles. The divide marketing functions have created between brand and performance teams, or online and offline, is another major hurdle Poole identified.

“TV buyers and planners are the ones we need to talk to, but much of the time it turns into a technology conversation about how this works, and digital of a sudden comes in,” he said. “So who do we talk to: The ones creating audiences and brand, or the technology and performance guys with the know-how to buy?

“In fact, you need to talk to both at the same time. We’ve had weird moments with two people who generally don’t work together too much, in the same room complementing each other from audience creation to action.”

Poole advises brands to adopt a multi-screen strategy better positioning where linear and advanced TV services sit in the hearts and minds of the consumer. He calls it a public, shared and personal screen approach.

“You have to start planning around screens, not digital versus offline,” he said. “For example, advertisers might have tried to get TV reach in other places and overindexed in such areas and want the quality of TV back. They’ll have an idea of personal screen and loads of tactics and strategy around that; then shared screens; which is linear and addressable TV; then public screens, including outdoor and billboards.

“And be sensitive to the environment in which the ad plays – you’re often planning into a living room.”

Peiffer labelled this the “co-viewing factor” – something VOZ is looking to report on. He estimated a co-viewing factor of 1.5 times.

“We now know drama commonly has more than one person sitting in front of it,” he said by way of example. “The more specific you get with a title – like CNBC news – the more likely you’re on your own. With entertainment programs, there are commonly two or more people watching. But what we also see from VOZ is how many watch on TV one week, then on another device the next, then as the show heads towards a finale, are back in front of the TV set in a group viewing situation.

“It broadens you back out and it’s not as targeted as you think, because these viewers could be one man and three females. It takes you back to the traditional concept of TV. People say TV has some wastage when they’re trying to reach the female audience – well, addressable TV could have some wastage as well.”

Clawing back advertising from digital goliaths

As for whether addressable TV will ultimately tip the scales back from digital targeting goliaths such as Google and Facebook, it’s too soon to tell. Portrate would love to think so.

“They are certainly very valuable channels and I won’t dispute there is place for everybody,” she said. “What I’d like to see is a recalibration back to premium content, because we can measure it. You’ll be able to see results the next day, which is really important given marketers are under the pump in the boardroom to deliver outcomes from their activities.

 “The key thing is the broadcasting industry will enable that flexibility which it hasn’t been able to do in the past. It’s a widget that’s going to help advertisers understand and give them more options.”

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