At a time when advertisers are clamoring for more data about their television ads, one company has found a clever way of gathering information about how many people are watching individual commercials via Smart TV.
Research company iSpot.tv has made deals with set makers to embed software that records what’s on the screen and also tells which spots are being watched, and whether viewers are fast-forwarding or changing channels during commercial breaks.
And with 10 million sets hooked up, iSpot.tv says it can now reliably estimate how many people are watching each commercial in real time—data that is hard to come by elsewhere.
The data is especially valuable at a time when media companies want to be less reliant on C3—Nielsen’s commercial rating used as currency for ad sales—as they take on digital competitors for marketing dollars.
Founded in 2012, iSpot.tv already provides an extensive roster of marketers with data about how much brands are spending on TV advertising and when and how often each commercial airs, while also gauging the online engagement with those ads. (Full disclosure: iSpot.tv provides some of that data to B&C.)
Satisfying a Need
But clients told iSpot.tv they wanted more. “The No. 1 thing we’ve heard that they wanted was if we could provide audience data and ratings data in this exact same manner. That would be a game changer,” said iSpot.tv CEO Sean Muller.
It took two years to figure out how to do that. The first idea was to make a deal with Nielsen, but C3 ratings were very delayed, making it unattractive. Set-top data, popularly seen as an all-purpose research solution, has similar issues.
“It’s hard to do an ad-first measurement with set-top boxes because you actually don’t know what ads are being inserted into each slot,” Muller said. On top of that, with set-top box data, you never really know if the TV set is on or off, let alone if anyone is watching. And more and more people are bypassing set-top boxes and using devices such as Roku to watch over-the-top programming.
“The only way to truly understand impressions and audiences for ads is to apply a digital-like approach to television, which means you’ve got to be in the player,” Muller said. “So we said, how do we get in the player, and that’s when we started doing a lot of investigation around Smart TV and IP enabled TV that for the last four or five years have been shipping with embedded technology in the firmware that can actually take a fingerprint of what’s going on on the screen.”
It took about a year to make deals with set manufacturers and half a year to integrate its systems with those in the sets and produce a product. Clients began receiving data in the second half of 2015. Now the product is ready to launch.
The Right Impressions
“What we have today is real-time impression data across all the different formats of watching television in an unduplicated manner. And view-rate data: Are people switching the channel, are they fast-forwarding in the middle of the ad, and at what point,” Muller said.
ISpot.tv’s system counts only spots seen on TV screens. For now, spots on tablets and smartphones aren’t registered. Those are often sold separately from TV ads by broadcast and cable networks.
Muller says the 10 million TV sets are representative of the U.S. in geography and demos. With smart sets selling for as little as $200 at Walmart and Costco, iSpot.tv’s sample is a little underweighted among lowerincome viewers, a bit over-represented among middleincome viewers and in line with high-income viewers.
As TV set prices continue to fall, Muller expects to have 16 million in the sample by the end of the year. Muller suggests that information about how many people are seeing ads and whether they’re staying tuned in is already influencing media buying decisions. He says nearly every movie studio is a client, as well as just about all of the wireless phone carriers and the big consumer packaged goods companies. The automakers are on board as well.
TV networks are also clients of iSpot.tv data and Muller says they’re just now being introduced to its impression and view-rate data.
Muller adds that data on view rates has shown interesting variations from commercial to commercial. Even with movie trailers, which are entertaining, some are watched all the way through by 97% of viewers, some are seen by as few as 60%. On average, across all categories, about 83% of ads are watched start to finish.
The view rates can vary based on network and show. Giving advertisers better information in real time enables them to run spots where they are most effective.
And while C3 assigns the same rating to all commercials within a show, iSpot.tv measures the number of impressions generated by each ad.
Muller says that iSpot.tv is finding a 25%-30% variance in the impressions delivered by different ads within the same program. Some of that difference depends on the creative, some is based on how late in the show it appears and some depends on where the spot is located within the pod.
“What we learned is that brands want to know the audiences for their ads. They’re much more interested in that than the program,” Muller said. “Now with a lot of the networks offering audience-based buying, everything is getting decoupled. The ads are going to be de-coupled from the programs and as that continues more and more, a new method is needed to make sure that the brands continue to advertise and spend on television.”