LONDON — With more than 50% of set-top television devices in the United Kingdom capable of delivering addressable advertising, clients of GroupM are excited because addressable provides more niche targeting and reduces dependence on panels for audience measurement.
“We have to a little bit careful we don’t think we will change the world in one day,” says Jakob Nielsen, UK Managing Director of GroupM Digital. “It will take time. But clients are looking for better value from what they have today. And addressable can give them that.”
In an interview with Beet.TV, Nielsen tallies the U.K. households that can be targeted for their particular characteristics via set-top devices: Sky Television with about 11 million, Virgin with some 4.5 million, plus Roku and other devices. This all adds up to market penetration of more than 50% of set-top devices in the UK.
“If you start by saying we want to move two, three, four or five percent of our TV budgets into this very exciting area for our clients, you are alive. You have a product there,” Nielsen says of addressable.
So far, the extra cost that can be associated with addressable ad inventory is borne out by results, according to Nielsen. As in the U.S., challenges include data availability, technology and “getting people to work together.”
Realist that he is, Nielsen doesn’t expect to hear much at the Cannes advertising festival about digital advertising issues that are near and dear to GroupM, for example fraud and viewability. “There is a very positive tone at Cannes,” he says. “You probably will not hear a lot about the big issues we have around fraud and the decisions we need to make about viewability. And yet is a big problem.”
Nielsen says he’s fascinated by the way technology will continue to change the process of creating content for consumers—along with who creates it. He notes that at ITV in the U.K., 50% of its profit and loss results stem from its studio operations, so content truly is a big deal for ITV.
Then there are athletes-cum-media companies like footballers Christiano Ronaldo (more than 150 million followers) and Lionel Messi (more than 90 million).
“They’re not football players anymore. They’re media companies,” Nielsen observes. “These people will start working more and more in this space. And we’ll see more and more professionally produced content that’s distributed in different ways and which will change the whole industry.”
This interview is part of our series “The Road to Cannes”, presented by FreeWheel. Please visit this page for additional segments.