Light Reading

Ad Industry Eyes Shift From Ratings to Impressions

Mari Silbey
5/5/2014
50%
50%

TV advertising is on the brink of a fundamental shift. Again.

Despite empty promises in the past of interactivity and addressable advertising, there is now a measureable change underway in how TV ads are targeted, sold, and delivered. At a Light Reading breakfast on Targeting Ads in the Multiscreen World hosted by cable/video practice leader Alan Breznick at The Cable Show last week, executives from Canoe Ventures LLC , Clearleap , Imagine Communications , Viamedia, and Scripps Networks shared statistics and stories illustrating just how far TV advertising has come... and how far it still has to go.

According to director of new media distribution at Scripps Alexander Beach, Internet advertising dollars surpassed broadcast advertising for the first time in 2013. At the same time, however, the TV industry is making tremendous strides in monetizing video on demand content. There were more than 2 billion ads inserted into free VoD content in 2013, according to Canoe Ventures head of product, sales, and marketing Chris Pizzuro, and the number for 2014 is already up to 1.7 billion ads in just the first four months. Pizzuro said advertisers are "jumping in" and that there are, on average, 179 VoD dynamic ad insertion (DAI) campaigns executed every week. (See Cable's Search for Advanced Advertising Treasure.)

Perhaps more importantly, multiscreen video services are creating crossover between the Internet and standard TV advertising. Executives at the breakfast panel agreed that the multiscreen trend is driving major changes. It's not just about where a viewer ultimately sees a commercial. It's also about how that view is measured. Multiscreen video means IP delivery, and that means considering a shift from TV's traditional ratings-based advertising model, to the Internet's impressions-based approach.

To take a step back, several executives on the multiscreen advertising panel offered perspective on how pay-TV operators have looked at monetizing new multiscreen services. Imagine CTO Steve Reynolds noted that operators have studied the question of whether they can charge extra for multiscreen delivery, but added that "advertising really is the obvious way to try to monetize that."

Pizzuro chimed in by pointing out that advertising is also what programmers know. Some programmers have tried to launch direct-to-consumer businesses with the hope of increasing revenue, but generally it hasn't worked out. A shift to impressions-based measurement for monetization may be dramatic, but it's still within a paradigm that content owners understand.

Unfortunately, familiarity doesn't mean there aren't still major challenges in moving to an impressions-based model. One big one is that operators still have to serve both a linear TV master, where program ratings prevail, and a digital master, where impressions are the preferred currency. And while providers want to sell inventory across multiple platforms, the data available from these different channels varies significantly.

Clearleap director of product management J.R. Cottingham explained that it's hard to do an apples-to-apples comparison of viewing data across platforms. Online datasets are richer than the datasets available from set-tops, for example, and operators not only have to collect data from everywhere, but clean it and make it actionable. The middle part is "monstrous," said Contingham. "How do you pare it down to that which is truly actionable?"

Still, the consensus of the panel was that the evolution to a new kind of data-driven advertising is already happening. Reynolds cited an unnamed customer of British operator BSkyB who has made the transition to thinking about impressions-based ad buying, and Viamedia president and CEO Mark Lieberman referenced Proctor and Gamble as having been vocal about seriously studying the same shift. According to Lieberman, Proctor and Gamble saw an 8% increase in sales across product lines when it reallocated advertising dollars based on a combination of set-top viewing data and other available datasets. That's powerful evidence of the value of direct viewing data over traditional TV ratings.

Reynolds argued that impressions-based advertising makes ad inventory more efficient, even if the transition period is a vulnerable time. Lieberman added that the impressions model gives programmers and advertisers a greater sense of accountability, which "I think is where the opportunity lies."

Technologically speaking, said Beach from Scripps, the industry is ready to change, but getting linear and digital sales teams to come together and converge on a common currency will still be difficult. Beach described the industry's progress on a spectrum of slither, crawl, walk, and run. "We're just slowly walking now."

— Mari Silbey, special to Light Reading

(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
5/7/2014 | 3:11:03 PM
Re: Mad Men
jabailo - Just this morning I unfriended a college friend on Facebook. I was happy to get a friend request from him a few months ago because we haven't talked since college. But since then the only time I hear from him is when he's promoting his book with boilerplate messages. I could dig through the notifications settings to find a way to mute him without unfriending him, but unfriending is simple. 

A lesson here for all marketers. Today, you have to send personalized messages and listen at least as much as you talk. Otherwise, you're the insurance salesman at the party who's doing nothing but trying to sell insurance. 
jabailo
50%
50%
jabailo,
User Rank: Light Sabre
5/6/2014 | 9:04:28 PM
Re: Mad Men
It's tough row to hoe...I see that many of the large news blogs, trying to make their way into the Facebook Feed format...often come across as big, and blustery...and in many ways a bit "tone deaf".   They ignore comments and commenters, even if points are made in contraction of their statements (!).   Sometimes I read something brilliant in the threads, but it gets steamrollered by the content provider reiterating the same point ten times in a row, as if we "didn't get it" the first time.   It's like one of those old Silent Movie attresses trying to make their way into the Talkies.  A medium that used to require a lot of drama and emotion to make a point, now requires the ultimate subtlety.  The ultimate...cool.   You really have to shrink down, and work your way into the crowd, rather than shouting..to enter the eye of the social media needle.   It's something we all need to to...to stop looking at media as a soapbox, and more of seat at the dining room table.

 
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
5/6/2014 | 3:02:09 PM
Re: Mad Men
jabailo - The amazing thing about advertising is that it still remains mostly Oratorical, like the hierarchical media.

By Oratorical, I mean one-way, top-down.

Social media is supposed to change that by making the lecture into a conversation. It remains to be seen whether social marketing will actually move products the shelves. 
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
5/5/2014 | 10:27:28 PM
Ad Industry Eyes Shift From Ratings to Impressions
@jabailo, I am in full agreement that the top-down approach is truly innovative.

This blog demonstrates the practical difficulties in aligning the data from the two different systems.

I am wondering if they might not create a new "hybrid" that bridges both systems.  If they moved towards impressions and went further by incorporating the pyschographics in how impressions affect actually purchasing decisions and buying habits, that might be a truly different dimension; one that responds to more two-way communications.
jabailo
50%
50%
jabailo,
User Rank: Light Sabre
5/5/2014 | 6:25:12 PM
Re: Mad Men
The amazing thing about advertising is that it still remains mostly Oratorical, like the hierarchical media.

By Oratorical, I mean one-way, top-down.

An advertisement is really a restricted story.  The advertiser wants to tell you a tale about the good parts of his product.  That was Don Draper's forte.  He found a story within the most mundane of goods.

However, in today's world, that is no longer possible.   While you show the front side, a hundred bloggers are looking at the left, right and back panels.

That said, even if you projected a hologram, you're still missing the essential part of the Conversational mode of social media.

It operates in two-directions.   Just as people will no longer consume thoughts or images, but want to create their own, and be seen as equals, so too, maybe the one-way nature of products themselves must change.

This is part of the argument of Makers, by Chris Anderson, who sees 3D printers converting our rigid global assembly lines to flexible, individualistic, local manufacturing.  But really, even with just a current fixed product, how many sites allow us to say, ask questions about a product, rather than be told?  

One way or the other, we're going to kick the tires.  Maybe that's what the manufacturers should be allowing us to do to create a lasting...impression.

 
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
5/5/2014 | 2:54:54 PM
Mad Men
This looks like a step to make advertising metrics more precise, which can only benefit advertisers and the networks. 

Interestingly (to me at least), this season's Mad Men is dealing with the ad industry's shift from creative-driven to analytics-driven advertising -- in 1969. The ad agency where the main character works got itself an IBM 360 mainframe. 

From The Founder
Against the odds, Huawei is growing its telecoms networking equipment business in the US -- that should be ringing some alarm bells for domestic vendors.
Flash Poll
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
Between the CEOs
Metaswitch's New CEO Martin Lund Discusses His Role

9|2|15   |   11:27   |   (1) comment


Technology industry veteran Martin Lund joins Metaswitch Networks this week as the company's new CEO. In this interview, Lund discusses his new role and the industry's progress with Light Reading CEO Steve Saunders. Lund believes that the industry disruption caused by SDN and NFV is creating opportunities for companies like Metaswitch – network software providers ...
Telecom Innovators Video Showcase
Nominum on Leveraging the Power of DNS to Deliver Superior Subscriber Experiences

9|2|15   |   07:13   |   (0) comments


Nominum CEO Gary Messiana talks about the challenges service providers face in competing for a much more sophisticated customer, a customer that has heightened expectations for more personalized and compelling digital experiences. Providers are focusing their efforts on delivering higher value subscriber services, retaining their existing customers and increasing ...
Between the CEOs
CEO Chat With Jeff Miller, ActiveVideo

8|28|15   |   19:05   |   (0) comments


Jeff Miller, President and CEO of ActiveVideo, talks to Light Reading founder and CEO Steve Saunders about the impact of virtualization on the TV and video distribution market.
LRTV Huawei Video Resource Center
Vodafone: Mobile Money Is About Customer Trust

8|27|15   |   06.36   |   (0) comments


Light Reading spoke with Vodafone's Ian Ravenscroft about the unique responsibilities and opportunities facing operators handling customers' financial transactions over the network.
Telecom Innovators Video Showcase
Palo Alto Networks on Expanding in the Carrier/Service Provider Market

8|26|15   |   07:54   |   (0) comments


Alfred Lee from Palo Alto Networks tells Steve Saunders about their new chassis-based system, the PA-7080, and how it can benefit service providers compared to legacy firewalls.
LRTV Custom TV
Global Services Forum Preview

8|25|15   |   02:36   |   (0) comments


Light Reading's CEO and Founder Steve Saunders talks about Huawei's upcoming Global Services Forum with the help of Heavy Reading's Patrick Donegan and Teresa Mastrangelo.
Telecom Innovators Video Showcase
Infoblox on DNS Threat Index

8|19|15   |   04:39   |   (0) comments


Dilip Pillaipakam from Infoblox talks to Steve Saunders about his company's core network services.
Between the CEOs
CEO Chat With Ihab Tarazi, Equinix

8|14|15   |   20:18   |   (1) comment


Equinix CTO Ihab Tarazi talks to Light Reading founder and CEO Steve Saunders about the dramatic changes in the data center, cloud and interconnect markets and discusses the impact of SDN and NFV in the coming years.
Telecom Innovators Video Showcase
The Netformx Ecosystem

8|14|15   |   09:39   |   (1) comment


Ittai Bareket, CEO of Netformx, talks with Steve Saunders about the Netformx Ecosystem, which employs cutting-edge prescriptive analytics to help solution providers maximize profits.
Telecom Innovators Video Showcase
Versa Networks on Leveraging VNFs

8|12|15   |   07:37   |   (0) comments


Kumar Mehta, founder and CEO of stealth mode startup Versa Networks, talks with Steve Saunders about how providers can best leverage virtualized network functions (VNFs).
LRTV Custom TV
Transforming the Network Through OPNFV

8|5|15   |   7:09   |   (0) comments


Sandra Rivera, VP Data Center Group; GM Network Platforms Group, Intel Corporation, on OPNFV Arno and how the industry is coming together to accelerate the deployment of NFV and transform the network.
LRTV Huawei Video Resource Center
Huawei ONS Product Demo

8|3|15   |   6:01   |   (0) comments


Huawei shows at Open Networking Summit 2015 in Santa Clara how its SDN and NFV solutions embrace openness.
Upcoming Live Events
September 16-17, 2015, The Westin Galleria Dallas, Dallas, TX
September 16, 2015, The Westin Galleria Dallas, Dallas, TX
September 16, 2015, The Westin Galleria Dallas, Dallas, TX
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
October 14-15, 2015, New Orleans Ernest N. Morial Convention Center, New Orleans, LA
November 5, 2015, Hilton Santa Clara, Santa Clara, CA
November 17, 2015, Santa Clara, California
December 1, 2015, The Westin Times Square, New York City
December 2, 2015, The Westin Times Square, New York City
All Upcoming Live Events
Infographics
Cisco's cloud and virtualization portfolio can increase business agility and innovation by building a more flexible network architecture.
Hot Topics
T-Mobile CEO Plays Data Traffic Cop
Sarah Thomas, Editorial Operations Director, 8/31/2015
CEO Chat With Bill Gates
Steve Saunders, CEO and founder, Light Reading, 8/31/2015
Time to Monetize Cable WiFi
Alan Breznick, Cable/Video Practice Leader, 8/31/2015
New Apple TV: More $$, Not Content – Report
Mari Silbey, Senior Editor, Cable/Video, 8/31/2015
Ex-AlcaLu Boss Tasked With Bolstering Altice
Iain Morris, News Editor, 9/1/2015
Like Us on Facebook
Twitter Feed
September 16, 2015
Wi-Fi First or Second?
September 22, 2015
Media Begins With “Me”
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Technology industry veteran Martin Lund joins Metaswitch Networks this week as the company's new CEO. In this interview, Lund discusses his new role and the industry's progress with Light Reading CEO Steve Saunders. Lund believes that the industry disruption caused by SDN and NFV is creating opportunities for companies like Metaswitch – network software providers with the agility to embrace new technologies quickly and the ability to deliver on substantial projects for global network operators.
The scene: Last Saturday, lunchtime, the interior of a shi-shi-foo-foo eatery in Manhattan's SoHo district.
Cats with Phones
Tastes Like Fish Click Here
Please hold while I lick the phone.