How Global Brands Like P&G Will Measure OTT Success

Advertising effectiveness can’t be judged solely on audience figures any more

As OTT disrupts the way we view broadcast and new forms of video programming, advertisers are eagerly looking to establish effective methods for targeting those coveted potential consumers and measuring the impact of their efforts. After all, OTT and CTV as it’s known is not just a hyper growth distribution model, it’s a much more addressable form of advertising - in theory.

Clearly, targeting audiences, and measuring ad performance on OTT platforms requires a different approach to traditional broadcast media. Advertising effectiveness can’t be judged solely on audience figures (such as reaching adults 18-34) any more. Key performance indicators for OTT ads can be affected by a plethora of other factors such as the type of content, app, live vs. time shifted, location, the time of day the ad was seen, and the degree of interactivity it offers – to name just a few.

With OTT ad spend expected to hit a staggering $31.5 billion in two years’ time according to one estimate, an entire industry is developing around analyzing audience engagement with OTT ads. Yet as P&G CMO Marc Pritchard recently declared at the IAB leadership conference, he’s looking for clarity and transparency from the marketing and media industry, calling on the industry to adopt: a single viewability standard for online advertising, third-party measurement verification, transparent agency contracts and prevent ad fraud by working with organizations such as the Media Rating Council (MRC) and the Trustworthy Accountability Group (TAG).

Also: Short-Form OTT Offers Big Opportunities

So as brands like P&G call for more clarity and transparency, how should they be measuring OTT success? Furthermore, the industry should be looking at OTT and CTV as the clear heir apparent to the linear broadcast TV market as the biggest budget line item for brand advertising. Done correctly, this format offers non skippable ads being shown on the biggest screen in the house, within premium content, and bot and fraud free.

Addressable or Precision (TV) advertising is evolving as a tremendous opportunity for advertisers to eliminate the kind of waste Pritchard is referring to by delivering the right ad to the right person on the right device – all at the same time. While it still is true that nothing delivers more eyeballs today than an ad during a hit TV show finale or the Super Bowl, addressable advertising can still uniquely support advertisers’ large-scale campaigns.

OTT has typically not been associated with Addressable TV, that has been dominated by the Pay TV operators delivering household addressability via their set top boxes. OTT represents a new form of addressable, one that can use digital data directly from an advertiser, or a trusted source such as Polk auto, or Acxiom to create custom targeting segments that can easily flow between all forms of digital video.

Also: Study: Ad Spending on Advanced TV Up 60% in Q1

And as audience and viewership become more fragmented, scale can be reached thanks to more sophisticated device-side measurement capabilities via set-top boxes and Smart TVs. So much video is now delivered by over-the-top (OTT) apps and devices to TVs, smartphones, tablets and PCs, enabling far more precise metrics than linear TV can, such as viewability metrics, brand lift metrics and census-based impressions that allow advertisers to make informed decisions, optimize campaigns on the fly and evaluate ROI.

Advertisers who embrace this fundamental shift from a “big game” mentality to one of reaching viewers across many screens and devices will be rewarded with up-to-the-minute flexibility, viewability metrics, brand lift metrics, and deeper audience insights that can be coupled with the ability to also measure against demographic and census-based methodologies that allow for comparisons to past performance of traditional TV campaigns.

As good as all this sounds, a common criticism of addressability in TV advertising is the lack of inventory available at scale, though this is certainly beginning to change. While TV quality ad inventory with this level of precision will take time to reach scale, we anticipate that a majority of premium inventory will be sold in an audience basis across linear TV, VOD, OTT and premium online video.

Advertisers will continue to apply more and more data to their premium video campaigns, going beyond age, gender and geography. Some will want to leverage their own data, and others will lean on media sellers to provide unique data, such as behavioral data to help target light vs. heavy viewers or movie watchers vs. sports watchers, for example.

Data and measurement is at the very core of the move to addressable advertising – from deciding which ad to serve and when to an individual to giving real-time and actionable feedback to advertisers to providing an absolute picture of the return on investment for an ad spend.

It’s conceivable that traditional TV demographics will be much less emphasized in the near future as the transition is made to audience based, and even 1:1 selling. And offering advertisers the fastest and most accurate ROI picture, detailed audience profiles, actionable results, and trends analysis will just be table stakes. These are the success metrics that matter.

It will be those who provide advertisers with more choice to mix/match best-of-breed strategies to impact how a campaign performs that will have the competitive advantage. We’re already seeing the ability to do things like measuring foot traffic lift from geo-targeted OTT ads as measured by wireless devices going to a store, car dealer or restaurant, and that device being connected to an OTT or TV household, giving advertisers a pretty direct attribution model on how OTT is performing.

We can now also measure online ad offline sales and give attribution to what ad delivered on what screen drove that conversion. This is very key for the traditional video and TV market to embrace, otherwise there will be a Google and Facebook attribution bias that only strengthens their position to brand advertisers at the expense of other programmers and publishers.

True attribution and conversion reporting for television and television content across all devices is the holy grail for advertisers because it lets them target ad dollars much more effectively. It’s what I like to call “precision TV.”

(Photo via FamZoo Staff's Flickr. Image taken on May 25, 2016 and used per Creative Commons 2.0 license. The photo was cropped to fit 16x9 aspect ratio.)