As consumer viewing habits continue to shift from linear television to video anytime and anywhere, advertisers are forced to contend with how best to re-allocate budgets to ensure optimal reach and target audience coverage. Meanwhile, broadcasters struggle to offset the stalling of linear ad revenue with digital budgets, despite generating large volumes of premium video inventory across all screens. Here Moritz Wuttke, SVP of commercial, TV Solutions Group at IPONWEB explains how shifting towards CPMs and audience targeting will help broadcasters more effectively monetise their valuable inventory.

Wuttke will be on stage at New Video Frontiers in London on October 16th, on a panel discussing the industry’s progress towards unifying cross-platform audiences.

The IAB Video Advertising Spend Report 2019 found that digital video budgets are expected to grow 25 percent in 2019. When it comes to where they can spend these dollars, advertisers are rather limited to YouTube and Facebook, the platform behemoths who’ve cornered the market on simple audience-based video buying at scale. This has left broadcasters’ valuable video and OTT inventory, which remains fragmented and lacks similar audience-level targetability, largely under-monetised.

If broadcasters want to compete with digitally native companies, they need to help today’s digital buyers to bridge the gap between traditional TV and digital video. There are several ways of achieving this, such as optimising linear TV, introducing CPM as a buying currency, and shifting to audience targeting.

Make it simple(r), make it like digital

Traditional TV buying is complex and fragmented across platforms, with limited data visibility and metrics that can be confusing for digital buyers; purchasing TV inventory has yet to be simplified and fully integrated into digital media’s expanding sphere of influence. Nonetheless, the IAB report referenced above also found that eight in ten advertisers agree that a unified multi-platform buying solution (TV + digital video) is important. Broadcasters, therefore, need to be building tools and workflows that make planning, buying, and measuring against their inventory and audiences as easy as it is on digitally-native self-serve platforms. These should be interoperable with other common digital currencies and planning, media buying, measurement and optimisation tools.

MCN (Foxtel), an Australian TV Sales house, addressed this challenge in 2018 when they launched an optimised linear TV platform that aggregates its entire linear catalogue into a single interface and allows local audience segments (from Australia’s national measurement panels MultiView and OzTAM) to be overlaid and purchased. By enabling new digital advertising formats across the entire catalogue of its 70+ channels to be packaged and bought through a single interface, MCN is able to generate new TV revenue streams from digital buyers while also simplifying (AKA digitising) the buying experience.

Create a common currency

Broadcasters need to find a way to satisfy the requirements of both digital and linear buyers, and make measuring and optimising across all channels consistent and easy. Traditional GRPs (Gross Ratings Points) only measure linear television and have made it harder for local TV stations to sell their digital audiences alongside their linear inventory. But consumers today no longer watch television solely in a linear fashion; as viewership fragments, advertisers need to be able to compare the effectiveness of TV and digital advertising and make better informed choices of how to deploy their budget across all media types utilising the same digital standard.

US broadcaster NBC Universal recently introduced CPMs as the currency of choice to address this, announcing in early September that all local TV stations owned by NBC and Telemundo will stop using traditional ratings points to measure campaign effectiveness in favour of the cost-per-impression (CPM) method. Similarly, a Singaporian media owner moved to a blended cost per viewer (CPV) currency across all media channels (TV, radio, digital and digital out of home or DOOH) to provide optimal reach at the most cost-effective rates. An amalgamated platform of this nature offers a unique alternative in that it enables dynamic advertising rates and CPM-based TV buying, as well as packaged cross-media selling.

Shift to audiences

TV buyers and marketers require a holistic view of where to find their desired audience so that they are able to target consumers across multiple content genres, programmes, TV channels, geos and dayparts while also understanding where to spend media most effectively. How should broadcasters do this? What data/measurement tools do they need to employ in order to forecast audience reach/spend against traditional marketing planning metrics?

Examples of audience targeting being put into action can be seen when TV media owners or sales houses have partnered with local data providers (as previously described with MCN) to create an aggregated view of the local ecosystem. In the US, TV ad sales house NCC, who sells on behalf of Cox, Comcast and Charter, has unified aggregate viewership data across a combined footprint of nearly 40 million households to develop a rich, audience-based planning and buying TV marketplace. Complementing traditional planning, reporting and measurement capabilities, this effort is the first TV ad platform to allow marketers to plan, buy and optimise their TV investments against desired audience segments, scaled across multiple video content distributors and cable inventory.

Success with simplicity

According to 2018 research from Juniper, advertising on Facebook and YouTube is expected to grow 130 percent and represent $37 billion in ad dollars by 2022. The trend is clear: demand for non-swipeable, non-intrusive, contextually relevant and (most importantly) audience-targeted video advertising is huge, and is growing massively, despite the brand safety concerns these environments have presented in the past. Broadcasters not yet making it easy for digital buyers to evaluate, forecast, plan, and buy their audiences across devices and at scale risk watching even more of this spend go to the major platforms.

By bridging the gap between TV and digital buyers, broadcasters will be able to open up new sources of (digital) revenue, while providing traditional buyers with the tools to better understand their media spend through a single unified platform and currency. And with increasingly local targeting functionality (i.e. postcodes) being included in the media opportunities, small and medium sized enterprises and digital agencies will have the easy, self service buying platforms that they have become used to from their Google and Facebook’s booking experiences.

View the original at VideoAdNews