Targeted Ads Headed Soon to Network TV

Nielsen looks to make targeted advertising — long the remit of Google and Facebook — widespread on TV

The television industry’s Holy Grail — targeted advertising in which next-door neighbors could see different commercials during the same TV show — is expected to become a reality next year as a big wall to widespread implementation is about to come down.

Brands crave the ability to direct their TV ads to more specific audiences based on data much as they do when they work with tech giants such as Alphabet Inc.’s Google and Facebook Inc.

Many advertisers see the decades-old model for ad sales that relies on wide targeting such as age and gender demographics as outdated.

Nielsen, the nation’s leading TV-ratings firm, on Tuesday said it would start measuring such targeted advertising on a national basis next year. The lack of a national measurement system for such ads has been a hurdle for brands and networks.

The new system will mark a fundamental shift in how Nielsen tabulates commercial viewership. Instead of calculating an average audience for all ads in a program as is the current practice, it will measure each ad individually, which is necessary for targeted advertising to work.

Targeted Ads Headed Soon to Network TV
Nielsen looks to make targeted advertising — long the remit of Google and Facebook — widespread on TV

The move is expected to boost the value of TV commercials, which have been under pressure as broadcast and cable networks have been losing viewers to streaming services and brands have flocked to digital advertising.

“This will be one of those grand scenarios where networks are happy, agencies are happy and ultimately the consumer gets a better experience down the line with ads that are more relevant to them,” said Nielsen Audience Measurement General Manager Scott Brown.

Nielsen said it was teaming up with AT&T Inc.’s DirecTV and Dish Network Corp., two of the nation’s largest pay-TV distributors, and smart TV manufacturer Vizio. The partnership will give Nielsen data from 55 million devices via smart TVs and set-top boxes.

Most targeted ads are now sold locally by pay-TV distributors, which are better equipped to implement and track different commercials that are sent to various ZIP Codes and even households. Advertisers can buy a targeted ad to reach much of the country, but it would have to be done piecemeal, through individual pay-TV distributors.

The lion’s share of ad time is sold by TV networks — roughly 14 minutes per hour — to brands whose commercials air in every home that is watching.

Jane Clarke, chief executive of the Coalition for Innovative Media Measurement, a consortium of programmers, advertisers and ad agencies that advocate for better audience measurement, expects Nielsen’s move to help slow the exodus of ad dollars to digital.

Other challenges remain, including the need for improved technology at many networks to handle the demand for targeted advertising.

“The networks have old trafficking systems,” Ms. Clarke said, referring to how advertising is inserted into programming.

The targeted-advertising television market is about $2 billion annually. That pales in comparison to the roughly $70 billion advertisers spend on traditional U.S. TV advertising, according to research firm emarketer, which tracks both categories.

Advertisers are expected to spend $142.3 billion on digital ads in the U.S. this year, eMarketer said.

One of the holdups to widespread use of targeted advertising has been an inability of brands and TV networks to track the viewership of such ads nationally, which Nielsen’s move is now addressing.

Nielsen said it expected to start providing preview data in the first half of 2021 with a goal of a full-fledged system up and running later in the year.

Nielsen’s Mr. Brown said he anticipated other pay-TV distributors, set-top box firms and smart-TV manufacturers to come aboard as well.

“We’re trying to make partnerships with all the names you would expect to get as much coverage as we can,” he said.

Via : Bangkok Post

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