In the complex and fragmented US TV ecosystem, the roll-out of “addressable” TV advertising capabilities outside of an OTT environment is somewhat limited.
TV networks give cable and satellite platforms the ability to sell just two minutes per hour of advertising in their live feeds of network programming.
What is it going to take for the addressable opportunity to be realized at greater scale, across the country?
At Beet Retreat in the City, “We’re Going Local!”, a panel of executives was asked by Janus Strategy & Insights president Howard Shimmel how to make national addressable sing…
- Mike Bologna, President, Addressable, Cadent
- Kelly Abcarian, General Manager of Video Advanced Advertising
- Stacy Daft, GM commercial and business development, Amobee
“There is not a scale problem with addressability,” Bologna said. “There are 60 plus, 70 million households where you can dynamically insert an ad to a household. It is with the local two minutes per hour. It is system by system. That’s not a longterm scalable model in order for it to really scale.
“National networks have to create some type of arrangement, relationship or deal with a MVPD or a smart TV because for the foreseeable future, ads that are dynamically inserted into live linear programming are going to happen through either the set top box or through the smart TV.”
“We are working with one of the largest chip set manufacturers globally, media tech and which to embed our technology directly into smart TV chip sets,” Abcarian said. “We are working alongside directly the OEMs in which to better our tech directly into their software layer.
“All of this enables you to unlock all 16 minutes in real-time.”
Software must be linked
“We believe has been holding back linear addressable … is a lack of technology and tool sets that really fit within the seller’s workflow,”said Amobee’s Daft.
“It’s not enough to just have a linear addressable insertion technology or have data technology. It has to be linked together with the sales process, which has to do with making them confident to be able to sell that inventory.”
Consistency is key
“If they all work in a different way, if 50 different networks are treating at addressable or a dynamic ad insertion differently, then it’s just going to be the same mess we have right now with seven different MVPDs – just four times worse,” said one2one’s Bologna. “And that’s not going to make it any easier for buyers and agencies and advertisers.”
Eyes on the prize
Bologna said addressable ads could end up commanding much greater returns overall.
“In an addressable world, you could take that unit and you could sell 20, 30, 40% of that unit at three or four times that CPM to multiple different advertisers,” he said.
“Then, of, course you have what’s left over that you would then ultimately sell at perhaps a 10, 15, 20% discount. The net-net in a perfect world would turn into a 10, 15, 20 perhaps 50, 60% increase in the overall value of the unit. So. instead of the network collecting $2,000 for the unit, they end up collecting $3,200 for a unit.”
This video is part of a series from the Beet Retreat in the City, “We’re Going Local!” hosted by GroupM Worldwide and sponsored by Amobee, Comcast Spotlight, TVSquared and WideOrbit. Please visit this page for additional segments.