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Addressable TV will become Australia’s new industry obsession in 2021 as broadcasters — buoyed by the mainstream success of over-the-top (OTT) services — apply data and technology to modernise linear TV. Broadcasters are looking to attract budgets from digitally savvy advertisers through more granular targeting, measurement, and reporting.
In Australia, consumers and advertisers alike have embraced OTT and broadcast video on demand (BVOD), with 80% of Australian video viewers watching OTT regularly, according to SpotX’s “OTT Is for Everyone” research. Brands have flocked to OTT, where they can benefit from the best of TV and digital combined. Advertisers have developed a taste for applying data-led decisioning, sophisticated measurement, and brand safety capabilities to TV-like ad experiences on the big screen. Now, broadcasters are eager to bring the same to traditional TV.
The promise of a single view of deduplicated reach and frequency is tantalisingly within reach, particularly as Australia’s all-screen, cross-platform planning and reporting tool, VOZ, is currently in the testing phase. This will have a significant impact on the emerging addressable TV trend.
Whereas OTT and BVOD were effectively new digital distribution channels at their inception, addressable looks to overhaul the behemoth that is traditional linear TV. This task shouldn’t be underestimated considering all the legacy processes, technologies, and lexicons. However, the revenue opportunity is real.
Despite the naysayers, TV still offers scale and impact, and remains popular with brands. With the transformative effects of data and technology, TV will quickly be capable of delivering on bottom-of-the-funnel sales and activation objectives as well as the brand-building it is known for.
So how can the major players in the industry ensure they are ready to maximise the addressable opportunity in 2021?
Broadcasters need to reduce friction for addressable buys
Buying and selling linear TV is straightforward and well-established. For addressable to take off, simplicity is essential — especially considering the potential complexity that comes with its increased capabilities and functionality.
Reducing buying friction should be priority number one, required both at a broadcaster and industry level.
A critical component is industry standardisation across targeting and measurement to enable advertisers to find audiences then track and measure their campaigns across a multitude of broadcasters, virtual multichannel video programming distributors (vMVPDs), and device manufacturers. This will require deep collaboration and new partnerships (often amongst frenemies) so all parties can agree on targeting definitions, universe estimates, and more.
A happy consumer must ultimately be the true north star, for whom the aim should be to deliver seamless, frequency-capped, and personalised advertising that creates a more enjoyable and relevant viewing experience.
Advertisers and agencies must lean into audience data
While agencies have had a tough time over the last 12 months, there is a shining light within recent earnings reports: their data businesses. This is a vindication of the multi-billion dollar investments by the likes of IPG in Acxiom and Publicis in Epsilon, for example.
The success of WPP’s advanced TV outfit, Finecast, could be a reflection of things to come. Clients are drawn to the promise that addressable TV combines scale with advanced data activation and measurement capabilities delivered via a fully managed service. Australia offers a sizable addressable opportunity. The country’s free to air and pay TV usage is the highest across APAC, with 69% of Australia video viewers watching regularly, according to SpotX research.
The ability to access and activate against broadcasters’ first-party subscriber data will be key for the buy side where accurate reach and frequency is a priority for addressable TV standardisation efforts.
The younger demographic is cutting the cord and flocking to OTT, while older audiences continue to watch TV — 62% of Australian TV viewers are more than 45 years old. Addressable TV could carve out an interesting position as the key channel to engage the older generation. With a higher disposable income, it is an attractive and lucrative audience for brands.
The ad tech stack is key to addressable success
A solid tech stack is central to the success of addressable. This includes data management platforms (DMPs) that allow targeting based on granular audience segments utilising a mix of broadcaster and advertiser first-party data along with third-party data sets. Server-side ad insertion (SSAI) is essential to insert digital ads within linear feeds, deliver buffer-less transition between ads and content, and manage creative separation and podding. Content recognition technology is also necessary to identify where to insert ad breaks within live broadcast feeds.
And, don’t forget demand-side platforms (DSPs), supply-side platforms (SSPs), ad servers, plus measurement and brand safety tools, all of which are essential to bringing the true power of programmatic to bear.
Broadcasters have been on this transformational journey before, with their transition to programmatic and launching new AVOD offerings. This shift to addressable, however, introduces additional considerations, which means trusted and transparent partners are key.
As the Managing Director of SpotX Australia and New Zealand, Ilda Jamison is excited to help both supply and demand partners achieve greater value within the cross-screen, cross-stream video ecosystem. With almost 20 years of international and local experience within the online publisher, data, and advertising technology industries, Ilda has held executive positions for top global and fast-growing startup businesses. Ilda is super passionate about leveraging technology to empower organisations to create a continuous competitive advantage through strategic partnerships, technologies, and investments.