Is It Now or Never For Advanced TV?

Changes in the media ecosystem didn’t start with the pandemic. In fact, some aspects of media buying and selling have been in discussion since the 1990s including Advanced advertising, according to Research futurist Bill Harvey, who has been touting the concept of advanced advertising since then.

Harvey participated in a recent Myers Collective Leadership conversation on the future of Advanced TV with a panel that included Kevin Arrix, Senior Vice President, Dish Media Sales, Jamie Power, Chief Operating Officer, Cadent, Marcien Jenckes, President of Advertising, Comcast and moderated by Jack Myers, Founder of MediaVillage.

The Addressable Market Landscape Today

Myers launched the panel with an opinion that I believe many of us share in the industry. “I have been studying the advanced, interactive, VOD, addressable market for a long time,” he began, “and truthfully, I’m not all that clear on who’s who and what’s what.” There is a litany of companies in the media space, who seem to offer opportunities that can overlap or conflict or split the market.  “Help me understand the dynamics,” he asked.

For Powers, one of the reasons that there might be some confusion is, “because we over complicate it.” In looking at the current set top box addressable marketplace with the MVPDs, she explained that there is, “Ampersand that has about 60% of the addressable households … then you have Dish and then Xandr,” which, combined, rounds out to the rest of the 40% of the country. She then noted that they have expanded to IP addressable to get their clients full reach in television. Cadent’s role is that they have, “created a platform to make it easy to execute across all the different screens and channels with consistent workflows and universal data, to get measurement aggregated all in one place” she stated.

“It’s worth noting,” added Arrix, “Advanced television is a holistic category. I would define it as anything that is data driven. I think Addressable is a part of the Advanced television marketplace. From my point of view addressable is defined as deterministic. That is the line that makes something addressable or not.” Ampersand, Dish and Xandr all have deterministic, set top box data, he noted, adding Sling, ATT TV Now, YouTube TV, Google Live and Fubo TV that are also subscriber based MVPDs.

Jenckes believes that the competitive set within advanced television is complementary because, “different distributors reach different households. So in order to reach the full US market you have to figure out ways to work across them.” He agreed with Arrix that, “there are other new forms of distribution that are emerging, like Roku which is a virtual distributor in some sense and there are others with addressable capabilities out there.” He added that once the national networks are enabled, we should expect significant growth in the amount of addressable inventory available in the marketplace.

“I agree with everything that has been said. Addressable is the umbrella term and the one type we have not called out yet is data-driven linear,” explained Harvey who added, “All of this is aimed at better results for advertising. That’s the whole point.” For Harvey, the topology maps out as such: MVPD addressability through a switch from the set top box and the Connected TV which can be a Smart TV or a connected device. The challenge from a data standpoint (which is something Nielsen and Project OAR is tackling) is how to best combine different data streams (such as from a smart TV in a local household or from terrestrial and satellite sources) that may have different latencies, delay times and black screens.

The Addressable Market Marketplace

So where is addressable headed? Forrester predicted in 2000 that addressable advanced television would be a $30billion industry in 2020. “Well here we are in 2020,” Myers noted, “and it’s significantly less. It’s a fraction of that.” He added that, “our forecasts are that in 2025 it will represent about 8-10% of the television ad revenues which will be significant growth but not the $30billion that Forrester recommended we would have today.“ Considering how off predictions were in 2000, one could be forgiven for being a bit skeptical about the robustness of addressable revenue growth in the next few years.

And yet, Jenckes believes that the biggest barrier to addressable growth – the technological challenge of switching from programming to ads - has now essentially been solved. But, he added, “the limitations we are having right now are around the amount of inventory we have available,” which is the two minutes an hour for addressable but even then, this inventory is often used in other ways. “So the challenge is how you improve inventory and how you manage yield. You can sell the inventory in a lot of different ways. I can sell a full spot at a set CPM or a much narrower sliver of that spot for a higher CPM but as the owner of the inventory I have to figure out which is best and how I optimize the value of that.”

The final challenge, Jenckes added, “is measurement and the biggest issue around measurement has been the historical restrictions that Nielsen has imposed on us as an industry,” Addressable is easy to measure because it is impressions based. The challenge is to measure, “the under addressable part of the campaign. What happens to the rest of the spot? Since Nielsen is panel based, if one of the panelists happens to get a different ad it breaks the model because Nielsen doesn’t know if that is one impression or a lot of impressions represented by that one panelist. There is a lot of work that needs to happen on that front,” he concluded.” But,” he then added, “these hurdles have been coming down. There has been a lot of progress around standards, around enablement and even on the measurement front although I think that will be the last frontier.”

For Powers, “the opportunity of addressable has been around for years. But agencies haven’t done it because we haven’t invested in the ad tech,” to facilitate the consistent measurement across platforms and services. In addition, “as a marketplace we are not articulating what the value-proposition is. We are over-complicating it. Advertisers and agencies are not understanding it.” She advocates for the creation of standards and a common currency. "If we cannot even agree … it makes it really confusing and there is not trust in the marketplace to try it.”

According to Arrix, “The key to the future is all about interoperability. The technology is getting better, the process is getting better. There has been a significant amount of progress made in the last few years.” That, with the recognition by the industry that, “data-driven advertising is just smarter,” is leading the industry to a growth surge for addressable.

The Future of Addressable

Propelling a robust future for addressable is data and measurement. In the past, the industry was wedded to the Nielsen panel. “But,” as Harvey pointed out, “right now there is more data each individual party has. The data is now disaggregated into these silos and if we put them all together we have the measurement system of the future. We don’t need panels except for nuances like co-viewing projections and stuff like that. Eventually that goes away too.” He admonished the industry to, “work together. Not just say it like we used to do but actually do it.”

That is the underlying structure for the business. “The big money comes when we get the network inventory. The two minutes an hour is not going to make it a big business. The $30billion comes as soon as you start switching to network addressable,” Harvey concluded.

“It is at the beginning of the game,” Arrix noted. “We see two paths right now. There is the true addressable path where you are breaking up the linear spot into impressions and you end up having the 80/20 rule with the 20% as the target and the 80% is the underlying impressions that you have to figure out how to monetize. That is how we operate now in our addressable business. The other initiative is creative versioning where you are not breaking up the linear spot but you are using deterministic data to deliver the right creative to the right household.”

But the stakes are high and the future is not assured if we all can’t come together as an industry to create standards and work together. “My fear is that unless we do that, we will be relegated to … the weakest player within television,” Jenckes warned. “And if that’s the case, we can all start the clock right now for the full and predictive demise of TV folks have been talking about for a long time. The good news is that because of the progress we’ve had, I don’t think that is going happen. There is a path and it requires collaboration.”

When it comes to business during the pandemic, “is business a bit little softer than usual? Yeah. But I don’t think COVD has a major effect on this,” Powers stated, “The same problems that existed before COVID, exist now. One thing that has happened is that there are more eyeballs watching the television and we know that we will pass the threshold (of 50%) at the end of this year from linear to non-linear viewing. Data is the only thing that is going to win in this marketplace.”

This article first appeared in www.MediaVillage.com

The Art and Science of Going Holistic in Addressable Advertising. An Interview with Cadent’s Rachel Herbstman

A lot has happened at Cadent over the past few months. For one thing, since our last discussion in April, Rachel Herbstman has been promoted to VP, Platform Analytics, Cadent Addressable from Director. For another thing, Cadent’s Addressable Platform has expanded and improved its capabilities. 

Adding Data Science and Automation to the Art of Media

Herbstman’s team has expanded over the past few months and includes experts in Data Science and Computer Science who partner with those with media backgrounds. “It’s a really great complementary approach and allows us to look at campaign analytics with different perspectives,” she explained and allows Cadent to “automate efficiencies and increase our overall productivity within the group.”

Perhaps the biggest change is the degree and type of automation that, in her words, informs the platform. According to Herbstman, “We can look at any visualization that slices and dices the data we receive, and because we are getting the data from the whole industry versus just one particular system or one particular type of media, we can learn a lot,” about the difference in advertising impact in different environments from VOD to Linear to OTT and across types of audiences. It is looking at data holistically to, “understand the actionable takeaways from all of the different dimensions.” Then, once the individual campaigns are analyzed, use this knowledge to help inform the entire category.

Cadent’s platform is an open ecosystem that can use, “any data set from any service. So if a client wants to use their own data, they can ingest that. If a client is more interested in prospecting, we can use their first party with any third party data and compare the difference between the two.” In this way an advertiser can ascertain the differences in audience behavior by platform.

How the Landscape Has Changed

Because Cadent is taking a holistic approach to addressable, they have a good view of the trends occurring in the media landscape and how different media types and messages resonate with different audiences by platform.  “So for instance, in a VOD environment, we may need less frequency to drive a conversion because the consumer is in an engaged, lean in, consuming media differently than watching a linear television show,” she explained. Being able to look at different cuts of data by audience, viewing environment, by creative length, is a great advantage and can lead to new insights into engagement and ad weight.

Reach is another area where having different datasets is valuable. There may be opportunities to add messaging later in a campaign to improve reach. According to Herbstman, “Maybe we layer on more messages in weeks four or five of a campaign when reach has plateaued so you can get new eyeballs and new impressions and pay less for that incremental consumer.”

Predicting Business Outcomes

Herbstman noted that one of the major efforts over the past few months has been the implementation of synergies within the company. “The analytics group has been working closely with the Products group and the Data Engineering teams and the Data Science teams,” she stated. This enables the company to leverage all of their historical data that has been received on a campaign by campaign basis to better understand the trends and form models to better predict future business outcomes. These models could also take into account things like seasonality and pod lengths.

“Our platform embraces the very best of all of the marketing tools,” Herbstman noted. “What we are able to do is understand, from a digital and a television perspective, how audiences are engaging in and consuming content. So from the onset of a campaign, instead of looking at addressability as a standalone tactic, we are talking to the agencies and advertisers to understand what their holistic campaign parameters are and how they are using other media tactics.” Holistic approaches are the wave of the future and Cadent is dedicated to being a frontrunner in that effort.

This article first appeared in www.MediaVillage.com

Cadent's Rachel Herbstman on Using Data to Make Addressable TV Smarter

Rachel Herbstman always had an interest in advertising and psychology and discovering, as she explained, "why people make the decisions that they make and how brand packaging and commercials impact decisions."  Her first job out of college was in performance-based buying at a DR agency, "focusing on performance-based KPIs, as well as branding and efficiency," and then on to Modi Media, a division of GroupM.  "It was one of the only agencies that had a centralized unit for advanced TV," she noted.  In her current role as Senior Director of Platform Analytics at Cadent, she is able to fully explore her interest in consumer behaviors through the use of granular data. 

Using Data to Bridge Linear and Addressable Television

Data and its use in the media industry have changed since Herbstman's DR days.  "Data used to mean more survey-based research," she explained. "Now, we are working with actionable data on television.  There are many data sets representing actual behavior that can be leveraged and then measured by real business outcomes."  Cadent is taking major steps to maximize the value of this data for advertisers; the Cadent Advanced TV Platform unifies linear and addressable campaign reporting to offer a transparent understanding of what worked and didn't work in their campaigns. 

"Marketers are looking for meaningful and actionable results, but typically, they don't get unified post-campaign analytics when they execute with a few providers," Herbstman said.  "[With Cadent's solutions across advanced and linear TV] we begin by asking the client, 'What are your primary objectives?  How are you measuring success?'  This can range from a brand health study or web traffic measurement to a first-party sales analysis from an addressable or linear perspective.  It depends on what the client is looking to achieve.  They can see it all from our platform in one clean snapshot."

Keeping Up and Standardizing Results

"The landscape is changing daily" with new data sets and new supply sources in the mix, Herbstman asserted.  Cadent's challenge is keeping up with the changing ecosystem.  "On our end, standardizing and aggregating the measurement across multiple systems is most important," she said.  "We are in constant communication with both the data vendors and the supply side partners to be sure that everything we can unify, we do." Depending on the client's key objectives, they now have visualizations that help them home in on the key campaign outcomes.  This eliminates the clutter, making data easy to digest, interpret and actionable for clients.

Creating commonality from the platform's output offers great addressable benefits.  "Post-campaign analytics fuel insights that inform future linear and addressable campaigns," Herbstman explained.
 

"Marketers get a full picture of their campaigns, including which networks perform best and at what point the campaign frequency reaches diminishing return," she continued.  "With standardized scripts, we can clearly interpret results and make strategic recommendations for future addressable campaigns and/or other media tactics the advertiser may be executing."

Tracking results is a big part of Cadent's philosophy, and working closely with the advertiser is an important component of the relationship.  "We want to make sure that from a measurement perspective we are tying it all together and can prove or disprove the initial investment," Herbstman explained.  "From the initial conversations surrounding the campaign test design, it's our job to provide consultative support.  Then, post-campaign, once the client understands the value in addressable analytics and sees the return on their investment, they're generally more confident in the next campaign.  Once that first campaign is complete, we use the results to optimize better for the next campaign."  Data from thousands of campaigns across all categories is stored and then used in scientific planning algorithms to enable the smartest strategic recommendations in the Cadent Platform.

Applying Results to Future Campaigns

The granularity of the data enables Cadent to drill down and better understand variances between targeted audience segments.  Being transparent is a vital component of the relationship.  Advertisers can understand every single part of the puzzle and how the addressable campaign varies from linear, VOD or IP-connected, for example, and understand the differences between the platforms and how to best use them in aggregate based on the category, strategic segment and KPI, Herbstman noted.

"Ultimately, standardized addressable reporting will lead to a more transparent TV ecosystem and better ROI for marketers," she concluded.  "Our goal is to provide an easily digestible analytics visualization tool that clearly narrates the campaign's performance -- wins and losses -- while understanding the integrity of the data and potential areas to optimize future campaigns."

This article first appeared in www.MediaVillage.com

 

The Update on Advanced Advertising

They say that the more things change the more they stay the same. The recent Advanced Advertising Summit this past week was notable in that the issues facing the industry seem to remain the same year after year. 

But the good news is that the technology is advancing to a point where the ability to seamlessly integrate digital and linear is ever closer to launch. Another positive change, for me, is the presence of more and more research and data executives in attendance at these types of conferences. When I first attended these events, there were few of my research compatriots there. Now we are even on sales panels!

Challenges in Advanced Advertising

Irwin Gottlieb, Senior Advisor WPP, in his keynote, explained that while advanced advertising has been around for years, it is not scalable yet. It is “somewhat scalable today,” he averred, “there are two minutes an hour (available) in local but it is not scalable in terms of support systems or inventory.” On the bright side, according to Gottlieb, there are no technology obstacles because companies such as WPP made deep investments in tech years ago. But there continues to be business obstacles where short term thinking, intra company fiefdoms and local vs national interests have enabled digital to “eat TV’s lunch.”

Scaling from a test to a full buy is another aspect of scalability that brings pain to the industry. Dan Riess, Executive Vice President of Ignite, WarnerMedia, noted, “We can always get clients to start a test but have find ways to scale that will trigger the technology to make it happen.” As a stopgap, he starts manually “to see how it works,” but there are, “so many different datasets, for example, that make it hard to scale.” Ultimately, we “need to move faster.”

Legacy systems are another challenge. Mike Mayer, Executive Vice President Sales Solutions, NBCU, explained that they are taking a “one order one report approach,” but if the order trail takes them from a legacy to legacy system, the buy has to be put together later. “It’s complicated,” he admitted, and it “can’t change overnight.”

Add to this the issue of silos. “Walled gardens make it difficult to develop business,” stated Jennifer Koester, Director of Telco and Distribution Partnership, Google. The solution is, “more standard segments,” noted Maureen Bosetti, Chief Investment Officer, Initiative, who added, “how it is being measured, more standardization and a privacy standard on identification,” with full compliance.

Positives in Advanced Advertising

But it’s not all doom and gloom. Many aspects of advanced advertising are hugely successful, offering manifold opportunities for both digital and television. Although linear TV is declining in usage, TV as a whole is adapting well to this multi-platform, advanced advertising ecosystem. Jason Brown, Senior Vice President, Head of Ad Sales partnerships, Xandr Media, finds that granular data enables us to “reach micro segments,” where the result is that “many advertisers are moving up the funnel,” and “TV is now full funnel for purchases, depending on the category.” This has resulted in “price hikes well beyond inflation.”

If there is one thing that TV does well, it is storytelling. Paul Alfieri, Chief Marketing Officer, Cadent, explained. Within the realm of advanced advertising, “a marketer can tell their story to consumers where they are and when they want. Is it seamless and we close the loop.” TV, according to Alfieri is learning from digital. “The industry has simplified it into one funnel and advertising is getting more sophisticated. It’s happening quickly because of paradigms you have in digital,” he stated.

No one is complacent. Many companies are creating their own systems that address advanced advertising like NBCU’s CFlight which, according to Mayer, “combines linear with digital impressions and sells deal with total impressions.” Others are joining consortiums like Vizio’s Project OAR, which stands for Open Addressable Ready. Project OAR includes Disney’s Media Networks, Turner, Xandr, Comcast’s FreeWheel and NBC Universal, CBS, Discovery, Hearst Television, AMC Networks and Inscape with the goal to define technical standards for linear and on-demand formats on smart TVs.

Jonathan Steuer, Chief Research Officer, Omnicom Media Group, recommended, a “focused on education on both the strategy and investment side.” He sees a big shift from linear TV to a more expansive view of TV in the digital space where we, “can use same strategic targets.”

Conclusion

So, yes, there are still vexing challenges in getting advanced advertising to scale, especially in national inventory, and we still need to agree on standards for measurement, segments and protocols. But the industry is hyper-focused on these addressing issues, often working together and always committed to progress.  That might be the greatest positive of them all.

This article first appeared in www.MediaVillage.com