Several of the largest television operators have created a consortium aimed at simplyfing and scaling the TV industry’s targeted advertising efforts in a marketplace many say has become unwieldy.
TV distributors Comcast Corp., Charter Communications Inc., Altice USA Inc. and Dish Media as well as smart TV maker Vizio Inc. are among the eight companies currently involved in Go Addressable, in an effort to advance addressable TV advertising, or TV ads aimed at specific groups of individuals.
Advertisers that once spent the bulk of their budgets on national and local TV ads are struggling to reach elusive consumers who favor streaming services and digital media. Some marketers are pushing their TV partners to operate more like the large digital companies that allow them to target ads to specific audiences.
But as media companies evolve their digital ad offerings, advertisers are tasked with cobbling together commercial space from various streaming services, smart TV companies, cable operators and even some programmers that are carving out their national ad time to enable more precise targeting, said Larry Allen, vice president and general manager of addressable enablement at Comcast Advertising, a unit of Comcast Corp.
“The buyers need a solution to their fragmentation problem,” Mr. Allen said. “That’s a massive constraint on the market and the buyers that either bought individually or had to patchwork together or went through aggregators. Unlocking that scale across multiple endpoints is really the endgame.”
Go Addressable doesn’t plan to build technology or create new systems. Rather, it will identify problems, consider possible solutions and connect with the industry players best positioned to solve them, he said.
The consortium, which meets once a month, will discuss issues such as which legacy systems should be updated to enable better workflow, or what jargon to eliminate so that different targeted ad companies can talk consistently about their processes and products.
One topic the group is discussing, for example, is how to make advertisers aware of the scale of available targeted ad inventory across various companies and systems, and to push that information to their planning tools, he said.
The ad business has long dreamed about the growth of addressable advertising in traditional TV. That means a mother on one street gets an ad that is different from one targeted at a young single man who is watching the same show a couple of streets away.
However, the cable and satellite operators are limited by the amount of inventory they control and sell (usually two minutes per hour) and, in some cases, the regions they service. Advertisers patch together ad deals with different cable and satellite providers, but some have found it more costly and time consuming than just running a national TV ad and capturing a combination of desired and undesired viewers.
Now these operators and TV businesses are faced with growing competition from streaming services that offer precise ad targeting without regional constraints.
The new consortium is one of many groups working on advancing an antiquated TV ad business that faces declining traditional TV viewers. Among them are OpenAP, a group founded by TV networks to advance the use of audience data in TV trades; On Addressability, set up by Comcast and other TV operators to help programmers create more targeted ads; and Project OAR, which was formed by TV and ad businesses to help the TV networks send ads to people with smart TV sets.
To be sure, the consortia have a long way to go before they can help the industry modernize. For now, the collaboration by competitors is noteworthy, said Mr. Allen.
“Getting eight companies to talk about their problems—I look at it like a therapy session,” he said. “It took us a while to trust each other.”
Write to Alexandra Bruell at alexandra.bruell@wsj.com
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June 17, 2021 at 05:30PM
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TV Operators Team Up to Simplify Fragmented Ad Market - The Wall Street Journal
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