Driving the addressable TV market’s growth, which some estimates put at 50% this year, is advertisers’ satisfaction with their campaigns there. Michael Bologna, president of One2one Media, estimates about 54 million U.S. TV households currently have the necessary technology for such ad insertion. Another 30 million-40 million televisions are expected by year’s end.
Advertiser Interest Is Growing Addressable TV
Should TV viewers soon expect a deluge of ads customized to their individual households? Maybe, if addressable television continues to build on the momentum it’s showing.
Addressable TV, which uses programmatic technology with advanced audience segmentation to deliver specific video ads to households in real time, is gaining currency with advertisers as more households get the technology to receive it. A discussion at the NAB Show in Las Vegas on Tuesday indicated that it’s poised for growth.
Michael Bologna, president of One2one Media, estimates about 54 million U.S. TV households currently have the necessary technology for such ad insertion.
Marcus Liassides, president of Sorenson Media, says his company is working with television manufacturers to develop a secondary market to the one launched initially by MVPDs. He sees another 30 million-40 million televisions augmenting the current 54 million by the end of the year, which will add necessary scale to the market.
Driving the addressable TV market’s growth, which some estimates put at 50% this year, is advertisers’ satisfaction with their campaigns there.
“They see the results, they spend the money,” Bologna said. He added that most agencies are also on board, at least in theory. The complexity for them comes in migrating the concept to reality.
Technological fragmentation on the back end isn’t making that any easier, and has made a seamless solution for advertisers and agencies elusive so far.
The difficulty of implementation is addressable TV’s biggest current impediment to growth, Bologna adds, and “the advertisers are looking to their agencies to sort this out.”
Part of that sorting out will need to include data gathering. Bruce Anderson, CTO of Invidi Technologies, pointed out that metrics need to be normalized among different operators.
“Today, that’s not the case,” he said. “Differentiation is a killer when you’re going after advertising dollars.”
When these issues are worked through, Bologna is adamant that this kind of advertising fall under the umbrella of television, not digital, and it needs to be planned and implemented like TV. And even then, it’s unlikely to overtake the entire ad ecosystem, despite its quantifiability.
“I don’t think advertisers will ever put 100% of their dollars toward addressable advertising,” Bologna said.
Rob Weisbord, COO of Sinclair Digital Group, agreed. “You need to create a brand to have stimulus” for addressable TV to work, he said.
Anderson thinks addressable TV might not even reach 50% of budgets.
“It really comes down to managing the funnel that you’re trying to reach,” he said. “You need a pragmatic view of where addressability works and where it doesn’t.”
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