Data-driven Addressable Advertising – The Next Frontier

Read the trade press. Go to a conference. Chat with your colleagues.  Everybody is talking about data.  If you believe the hype, data is going to revolutionize TV advertising.  We hear about how a complex target can be defined well beyond the Neilsen cohorts that have driven TV advertising for decades.  Examples of some new target audiences include auto intenders with more than two children; dog owners who buy premium brands; and even consumer package goods customers who buy competing brands. Clearly this is a far cry from buying solely on age and gender.  But is this the ultimate vision or can more be done to unleash the power of data?

First, let’s define the various types of data as it relates to TV advertising.

Viewership Data

Most discussions surrounding data focus on the characteristics of the viewer.  Data is collected by service providers showing which set-top boxes (STBs) are tuned to which programs at any given time. When the characteristics of the household in which the STBs are located are matched with the viewership data, it is possible to gather ratings specific to the advertiser’s chosen audience.  Target/viewership data is just the starting point.

Impression Data

The next type of data is more campaign specific.  In order to measure the effect of the campaign, we need to know who saw the ad, how many times they saw it, and for how long.  This is impression data. The data must be anonymized to protect viewer privacy, but the data can be used to determine reach and frequency.

Conversion Data

The last type of data provides an indication of viewer action after seeing the ad. In the vernacular, this is known as attribution or conversion data.  Actions do not have to be purchases.  Any Key Performance Indicator (KPI) can be used.  Visits to websites, calls to a toll-free number, credit card applications, requests for information, are all examples of KPIs that can be used. Pairing impressions with conversions can show the effectiveness of the ads.  Again, this must be done in a privacy-centric manner, but if done that way the data is extremely powerful.

There are many ways to use the various forms of data.  ROI analysis, A/B testing, and even the use of cross tabulations are just the beginning. Data will open up the world of automatic campaign optimization and even impression-based programmatic buying. The next frontier of TV advertising is just beginning.

Written by Howard Fiderer, SVP Strategic Corporate Development and Product Line Management