Programmatic audience buying, a ubiquitous force in digital marketing, is now cornering the next slice of the tech stack: television. But unlike digital, TV rates are governed by survey data instead of the classic supply and demand model. Nielsen, the de facto national television viewership service, monitors (and therefore fixes) TV rates and uses the set-top habits of around 5,000 households to represent the larger viewership patterns of 99 million U.S. households.
This, arguably limited, method is called statistical sampling and it presents two problems for advertisers:
- How many consumers am I reaching?
- And who is actually watching my commercials?
Addressable TV advertising, which Awlogy has already seen success in, layers viewership data and ad buying automation to more precisely target specific consumer audiences and answers both of the above questions.
Similar to the programmatic solutions found in digital and radio advertising, addressable TV allows marketers to replace traditional, limited demographic targeting with modern, behavioral targeting. Advertisers can target audiences based on hundreds of data points, including, but not limited to: HHI, purchase habits, time of day, and weather. The list goes on and on.
Addressable TV means more informed audience buying for advertisers and more relevant advertisements for consumers – a win, win.
But addressable TV has been slow to get off the ground, making up only 4% of all current TV ad spend. Content with the current advertising landscape (and its huge profit margins), the major broadcast networks (CBS, ABC, NBC & Fox) are resistant to embrace programmatic. The networks are concerned that data-driven advertising will commoditize inventory and decrease prices on premium TV ads. On the other side of the scale are service providers (Comcast, Dish, Cox, etc.), with more inventory than they can sell and an appetite for television’s programmatic commencement.
Pushed by service providers and local broadcasters, addressable TV is rapidly gaining momentum and programmatic TV ad spends are projected to reach $19 billion by 2019. Seeing dollar signs, major networks are beginning to budge and in the last few months, both NBC and FOX have announced proprietary plans to begin selling off selected inventory programmatically.
Founded on an audience purchasing framework, Awlogy is well poised to navigate clients through this developing medium. Televisions recent advancements in audience based targeting gives us the confidence to announce our endorsement of addressable TV advertising for the right campaigns. We see the marriage between the immersion of television and the systematic targeting of programmatic to be an invaluable progression for the industry at large.
That being said, addressable TV is in its infancy. Currently, an advertiser can only buy programmatically from a few, select platforms and campaigns are limited to large DMA, statewide, or national buys. But improvements are coming fast, and it won’t be long before programmatic TV is an ideal medium for buyers big and small. Awlogy has entered partnerships with each addressable TV provider and will be there every step of the way, meticulously mapping addressable TVs progress.