Tuesday

Losing Money By Missing the Demo Target


Focusing on the wrong consumer target is the fastest way to squander an advertising budget. So why are advertisers so insistent on targeting the wrong consumers? “Money is being lost to the industry by invalidating the 55+ audience, which captures a disproportionate share of the network TV audience for many networks – as well as a key consumer audience,” noted Media Ecologist, Jack Myers.

Yes we have heard the old yarn that the best way to cement future purchasing patterns is to capture consumers while they are young. But that philosophy does not take into account the transitory and evolving nature of our society and the actual behaviors of all consumers in today’s economy. Advertisers who want impact for their ad spend must change their mindset from youth obsessed to ROI focused. Who is doing the viewing? Who has the discretionary income? Who is on the bleeding edge of today’s trends? Boomers, boomers and boomers.

Follow the Money
According to Forbes, Americans over 50 account for $7.6 trillion in direct spending and related economic activity annually and control more than 80% of household wealth. And according to Bank of America Merrill Lynch, the global spending power of those over 60 will reach $15 trillion annually by 2020. That’s a lot of green in that grey market. Boomer spending spans many product categories. Health is an obvious area but, in addition to pharmaceuticals, it also includes biotechnology, devices and services.

Forbes notes that “when it comes to housing, transportation, entertainment, food and alcohol, older people already have their checkbooks out. Americans 60-plus are expected to account for at least 40% of consumption growth in those areas between 2015 and 2030.” And let’s not forget finance and auto motives where older Americans have the money and the interest to spend heavily. Boomers are hardly technophobes having lived through a period of great technological advancements from the advent of mobile phones (the size of shoeboxes) to viewers’ choice (with remotes, cable TV and VCRs). The embracing of new technology continues today. Today, “the greatest consumer group for Apple products is men over the age of 65,” noted David Harry Stewart, Founder, AGEIST.

Young adults have much less discretionary income on average because of crippling student loan debt and high credit card balances.  According to David Carlson, YoungAdultMoney.com, it is a disturbing story. Fifty percent of Millennials feel they have too much debt, 70% consistently carry balances on their credit cards, 40% find it difficult to meet their household expenses on time each month, 45% are using credit cards to pay for monthly necessities because they can’t afford them otherwise. Sadly, 48% have student loan debt. Nearly half of those with student loan debt are concerned about being able to pay them off and 83% of those who have student loans say that their student loans have had a moderate or significant ability to meet their other financial goals. Tell me again why Millennials are the prime consumer target group?

Radha Subramanyam, Chief Research and Analytics Officer, CBS, “In the context of student loan pressures, deferred big-ticket spending and delayed ‘adulting’ from millennials, it is critical to plan against audiences, and not just demographics, to drive business outcomes.  Audiences that have been left out of media plans are often the most affluent and the most likely to drive spending across a range of categories, including auto, fine dining and travel.”

Follow the Viewers
At a time when television is undergoing a viewership decline, programmers are moving to C3 to C7 to stem the decline in linear audiences. But this is hardly a panacea when the largest share of linear viewers continues to be the undervalued and undersold older viewer who consumes much more media on average than any other age group? Nielsen’s recent Total Audience Report confirms that adults 18-34 spent 8 hours/45 minutes a day with media versus 11 hours/9 minutes for 35-49s, 12 hours/50 minutes for 50-64 and 12 hours/16 minutes for 65+.

Why not price the value of the viewer according to their purchasing power? “A failure to monetize this valuable audience translates into a failure to understand and translate their value in the growing wave of ROI-based and impressions-based measures. If the industry is focusing on ROI for marketers, why fail to include a large share of the consuming public in the metrics?” posited Myers.

Follow the Trends
We are in the age of disruption. But these disruptions go beyond the technology that has claimed our attention and purchasing patterns. “Forty percent of the American population is over the age of 50. That is a lot of people to make invisible and put in some medicalized group,” Stewart stated. “In two years’ time, there will be more people over the age of 65 than under 5 for the first time in human history.” Today’s 50 year old can have a rational belief that they will live another 30 to 50 years of life ahead of them, “essentially a life 2.0. The greatest demographic disruption our species has ever had.”

Follow the Logic
It is not too late to reconsider the targeting parameters by age. “We feel that we are being disempowered and made to feel invisible by the culture around us,” warned Stewart, “But we are the people that helped to invent the personal computer, the mobile phone, skateboarding and punk rock. Think of what we could contribute going forward if we are allowed to.” And think of what advertisers can gain by targeting this rebellious, culture-making cohort.

Thursday

Using Advanced Technologies in Advanced Television. Interview with dataxu’s Sandro Catanzaro


There is a lot of talk about the introduction of AI and machine learning (ML) to better understand human behavior. Now, as these protocols move into the media industry, we are finding more companies employing AI and ML to better target consumers over time. 

Sandro Catanzaro, Founder and Chief Innovation Officer at dataxu describes himself as a serial entrepreneur. He was one of the co-inventers for dataxu’s real-time optimization algorithm, based on research he did at MIT. Here is an overview of his company, the world of advanced and addressable television and the data work being done in the industry.

Charlene Weisler: What is your definition of advanced TV? Is it the same as addressable?

Sandro Catanzaro: Advanced TV is TV advertising that is purchased on an impression basis using advanced audience data and software automation, creating additional value for both the buy and sell sides of the transaction. Addressable TV is a form of advanced TV where households are targeted on a one-to-one basis via cable and satellite set-top boxes, Smart TVs and OTT devices, but not all advanced TV is necessarily addressable. Other forms of advanced TV may be based solely on automating the purchase process, but still displaying ads on a one-to-many broadcast basis.

Charlene Weisler: What are the challenges in advanced TV?

Sandro Catanzaro: One of the primary challenges in advanced TV right now is the ability to target and provide attribution for OTT campaigns. This form of TV is accessed by the viewer via internet enabled televisions and streamed either live or on-demand. The connected nature of OTT makes it very similar to digital video, but as these ads run on actual TV screens and not traditional digital devices (PCs and mobile phones), the typical digital markers (cookies and mobile IDs) are not available for identification, making advanced targeting difficult.

Charlene Weisler: How can they be overcome?

Sandro Catanzaro: This issue can be overcome through new forms of identity management made possible by cross-device graph technology. A device graph is the unification of several otherwise separate devices, such as a laptop, mobile phone, tablet and smart TV under one unique household. In the real world, these devices don’t exist in a vacuum; they are linked through ownership and usage and can be used to understand the full context of a person’s digital footprint. By including smart TVs and OTT devices in a device graph, marketers are able to leverage advanced audience data, built using legacy digital IDs, to enable addressable targeting on televisions, even though these legacy IDs are not present.

Charlene Weisler: What metrics do you use?

Sandro Catanzaro: Advanced TV is typically purchased on an impression basis as opposed to ratings, but it is possible to provide traditional TV metrics such as GRP. However, we find that marketing professionals are also frequently leveraging more detailed metrics to prove success, such as lift studies which compare conversion rates of exposed populations versus control groups. This is made possible through addressable forms of advanced TV and device graph technology, where specific viewers are directly targeted and others are intentionally excluded, in order to compare their actions across all devices, and in the real world, after having viewed the ad.

Charlene Weisler: What is dataxu?

Sandro Catanzaro: dataxu is a software company that helps marketing and media professionals use data to improve their advertising using AI to optimize ROI on marketing investments. dataxu ingests first-party data (e.g., customer purchase information), matches it up with many other kinds of data across devices and identifiers and creates a customer machine learning classifier for each campaign that invests more budget into what’s driving acquisition and less into what isn’t. We offer three products: TouchPoint™, our demand side platform (DSP); OneView™, our identity and data management platform; and ClearSight™, our advanced analytics and data visualization product.

Charlene Weisler: Where does it reside in the ecosystem? Who are your competitors?

Sandro Catanzaro: Sandro Catanzaro: Some of our products, such as TouchPoint™, compete with other DSPs, including The Trade Desk or MediaMath, but our analytics, cross-device identity management and advanced TV capabilities stand alone.

Charlene Weisler: How will GDPR impact your side of the business?

Sandro Catanzaro: dataxu has always placed the highest value on transparency, quality and privacy. We have had a dedicated task force for GDPR since it was announced. We expect GDPR to have an impact on the entire industry, not just dataxu; however, we know we are prepared and well-positioned to face the challenges coming. We were fully prepared when GDPR came into effect; we are active in industry-wide schemes (such as the IAB Technical Consent Program), are a registered vendor with the IAB Europe and are members of self-regulatory organizations [e.g., Network Advertising Initiative (NAI), Digital Advertising Alliance (DAA) and European Digital Advertising Alliance (EDAA)] to make sure our customers are best placed for success under the new rules.

Charlene Weisler: What does the future of TV buying look like 3-5 years from now?

Sandro Catanzaro: In the next three to five years, we expect more and more people to follow the growing trend of taking their viewership to connected devices, not only leading to more innovation surrounding those devices, but creating a larger pool of inventory for advertising to be served. We expect that in this time period all major TV programmers will have made their content available via connected devices and most will be providing marketers access to this advertising via programmatic channels. The largest portion of TV buying will still operate through legacy methods, such as upfronts, but advanced TV will soon constitute a much larger piece of that pie in the near future.

This article first appeared in www.Mediapost.com
 

Wednesday

Getting a Grip on AI and Metadata Madness at the MESA Smart Content Summit


Data and its think/speak has become so ubiquitous in the industry now that it's reference in any context - sales, content creation, marketing and branding - is not only commonplace but also becoming de rigeur. But as with anything that permeates the ecosystem, there is a time for it to be standardized with a common language, protocol and usage pattern. All of that is beginning to gel as evidenced by the panels at the third annual Media and Entertainment Day conference held at the Microsoft center in NYC. 

Monetization
Moviepass, where subscribers pay $10 a month to be able to see one movie a day for the month has proven to be extremely popular. But if Moviepass based their revenue success strictly on subscribership fees, they would fall short. Instead, Ted Farnsworth, chairman and CEO, Helios and Matheson analytics, seeks to turn Moviepass's data into the main revenue stream. While not selling their data to clients, Moviepass instead sells insights from their data to interested parties such as film producers. Moviepass also uses their data for recommendation engines that “push people to the theatrical experience,” and assist the company in acquisitions and “develop films based on the data we have.” Farnsworth explained that data also helps detect fraud including, “sharing passwords, subscribers selling their tickets or giving their tickets away or detecting unfair trade by theaters.” According to Farnsworth, Moviepass is helping to bolster attendance especially at smaller theaters, encouraging Millennials to go out to the movies and showcasing more independent films that may not have large marketing budgets. 

Content Tracking
There is a vast amount of metadata that is currently available and new sources are increasing every day. The challenge is not only capturing all of this data but also tracking it within a company and across companies in the industry. Various forms of data labeling, such as being able to distinguish specific ads and specific programming, ascertain which regions of the country and the world and even what subset of language (such as Latin American Spanish or Castilian Spanish)  is being spoken in the content must all be identified and properly labeled in an agreed industry standard. Efforts by companies such as HBO and organizations such as CIMM have begun the heavy lifting work in content labeling for the industry. “The challenge to these IDs is having people register and embed throughout their practice,” stated Jane Clarke, CEO and Managing Director, CIMM. However, according to Brian Hughes, Senior Vice President, Audience Intelligence and Strategy, MAGNA, agency clients are already using Ad-ID. “On the ad side we are generating use. In terms of how we sell it though, we say this is how we can tell where an ad goes, how it performs and what the results are,” he noted.

Storytelling
“From inception, data can ride along with the piece of content and enrich that piece of content,” noted Guy Findley, Executive Director, MESA. From a content perspective, there is so much data being created and collected that it can be challenging to present it in a form that makes it flexible to use and manipulate. Matt Turner, Chief Technology Officer, Media and Manufacturing, Mark Logic, spoke about smart content and the digital files created from content inception to pre-production, post production, distribution -both primary and secondary - to archiving and ultimately into future infinite uses. But the “traditional data approach makes looking at metadata difficult today,” noted Turner because it creates data silos.  He advocated a new approach using flexible schemas that link together in an operational data hub for media. “ This makes the data available across all parts of the business and interacts with all systems,” he explained. An example of this is NBCU’s Saturday Night Live which can now search for concepts using the data hub and “Disney’s creative genome project that collects data from all around the show.”
Conclusion
As Daniel Goss, Vice President of Innovation and Experience, LiveTiles, stated, “Data and analytics are embedded with everything you do.” From the media industry’s viewpoint, data is touching all aspects of the business from creative content creation to financial impact of our business decisions. Locking into industry standards for labeling, data framework and measurement will enable us to derive the maximum benefit of this growing and powerful resource.

This article first appeared in www.MediaVillage.com
 

Tuesday

It’s Time to Welcome the 55+ Demo into the Media Mainstream


Some topics of conversation in media never get old and that includes the ongoing discussion of the value of older consumers. For years, many of us in programming, marketing and advertising have been engaged in one long conversation regarding the accuracy of age-based demographic breaks that effectively exclude Adults 55+ from the sales value equation. “Oh we don’t need to specifically target Adults 55+,’ they will say, “because we can reach them anyway – they are heavy TV viewers.” Well not so fast, sonny. Today’s 55+ are not like 55+s of yesteryear.

While this has been argued before, it bears repeating. According to economic trends, today’s older consumers command much greater buying power compared to current and previous generations. Boomers alone represent 70% of the total net worth in America and account for 40% of total consumer demand.  It is time for the media metrics to keep pace with economic realities.

Media Ecologist Jack Myers believes that it is vital for the industry to come together and change the traditional age-demo breaks. “We need to recognize the economic and societal evolutions that have occurred since the 1960s and embrace a new set of demo standards,” he stated. He proposes the following breaks:
Ø  Teens/Tweens (11-17)
Ø  Gen-Z (18-24)
Ø  Millennials (25-45)
Ø  Gen X/Y (45-62)
Ø  Boomers (63-75)
Ø  A new combination for sales targeting purposes (45-72)

The History
Let me share some history that will help explain why this makes sense. It all started out innocently enough. In the early 1960s when advertisers divided the media pie into simply households and men or women, upstart network ABC, which trailed in overall household performance, had a great idea; why not further divide the population into age breaks? After all, the younger-skewing ABC argued, younger people were less fixed in their brand loyalties and were more open to change and experimentation. At the time, they were referring to the rebellious Baby Boomers who were very different psychologically from previous (and future) generations. Unfortunately, the idea of youth worship based on age alone resonated with advertisers and programmers. Today it has stultified into dogma.

A sales positioning idea that was initially conceived to more easily categorize audiences into future, peak and declining brand building and spending years has, in my opinion, led the industry astray. In fact, one could argue that 18-34, 18-49, 25-54 and 55+ breaks never really made much sense. Did an 18 year old ever really spend like a 49 year old? Does one fall off the face of the economic earth on their 55th birthday? Of course not!

If there was ever a cohort that should be actively sought by advertisers and programmers, it would have to be psychologically based, not necessarily age-based. Who came of age when consumerism was at its peak, when advertising was the epicenter of choice consideration and when media technology was young and experimental? Baby Boomers. Today they are still active in the workforce, are in their peak earning years and are as changeable and rebellious as ever. Maybe it’s time to finally reevaluate the age-break demographic to better reflect the behavioral dynamics of the generations it purportedly represents.

Changing Business as Usual
Older consumers in 2018 are very different from older consumers in 1960. In 1960, if you were 55+ you could have experienced a Depression and two World Wars in your formative spending years. There were also much fewer brands and the major forms of communication were newspaper and radio. Today’s older audiences grew up in a time of relative luxury and peace, the grand expansion of media communication and advancements in healthcare that has extended not only longevity but also quality of life. How today’s older adults live and spend are worlds apart from their grandparents and parents.

Getting to Consensus
In this highly competitive media world where reaching the “right” audience is pivotal to success, how do we get all of the players to agree on a modification of the standard age-break ranges? Megan Clarken, President Watch, Nielsen, understands the dynamics of the marketplace. “Reaching industry consensus is always a journey, especially when it comes to determining changes to the currency,”  ​she said. “For example, if an older-skewing network pushes for an age-break re-definition, there will be a younger skewing network that would push back. Our role is to encourage the conversation and provide the data and insights - whether its age-gender or advanced demographics beyond the standard demos - that the industry needs to transact with confidence.”

But there is some movement in reaching a new consensus. “While the vast majority of industry deals remain a demo currency, revisiting demographic breaks is an important piece,” advised Radha Subramanyam, Executive Vice President, Chief Research and Analytics Officer, CBS Television Network. “Going forward, moving away from age/gender as the foundation of planning and buying seems to make the most sense. The framework needs to be audiences and audience cohorts, though defined more broadly than some of the segments currently popular in the programmatic ecosystem,” she added.

In a world quickly moving to more addressable consumer segments, some believe that a change in the standard age breaks are unnecessary at this time. “Given the industry’s continued push to implement purchase-based targeting, I am not sure there is a strong rationale for what looks to be subtle changes,” stated Ed Gaffney, Head of Implementation Research and Marketplace Analysis U.S., GroupM. “Targeting begins with planning. The buying teams simply refit the planning target to a demo to facilitate media deals.”

Further, as we head more towards cross platform measurements, Gaffney believes that it will inevitably lead to a new targeting consensus. “The linear networks will most likely not be interested in moving to different demos when they could move to targets that better align with those used in digital buys (signal based), and digital is not very interested in using age based targets for anything but comparative purposes,” he added.

Others believe in going further by dropping age-break metrics entirely, even for comparison purposes. John Rosso, President Market Development, Triton Digital, a leading online audio measurement service, explains, “The real question in my mind is this: why care about age at all? The digital world has moved on to audience targeting and, through initiatives like Open AP, the traditional media world seems to be embracing more advanced audience segmentation as well. Do we still need to use demographics as a proxy for behaviors and intents when we can target those things directly?”

Nielsen remains the unbiased arbiter of age-break demographics preferring the industry to decide for itself what metrics work best for the buy/sell paradigm. Because of this, Nielsen must remain neutral. “We don’t set the rules for the industry. We rely on the industry to negotiate the rules amongst themselves. And there isn’t any general industry committee that I know of that actually says ‘this is the rule’ which makes it tough to reach a consensus. Nielsen is a third-party, independent organization so it's difficult for us to do it on behalf of the industry,” Clarken concluded.

In my next article on this topic, I will explore how outdated and irrelevant media buying and planning tactics are costing the media industry billions of dollars.


This article first appeared in www.MediaVillage.com