Reaching local television audiences was sort of a “nice to have” piece of most national advertisers’ marketing plans. They knew they could use local buys to heavy up in places they needed help, but beyond that, it wasn’t much of a concern, something they could probably handle with digital or social if they really needed to.
That all changed with the pandemic.Suddenly local audiences were hot. At a time when states are opening up and shutting down (“The Hammer and the Dance”) at different times and in no predictable pattern, running the same ads nationally no longer made much sense. Brands were scrambling to be able to target local audiences so that they could deliver messaging that was relevant to that specific region at that exact moment.
What they found however, was what they’d found everywhere on TV: audiences weren’t just watching linear TV, they were watching OTT and VOD as well. Some groups more than others, depending on their ages and interests, but it wasn’t as if there were specific “linear” and “non-linear” audiences.
Fortunately, local broadcasters and MVPDs had already figured that part out and were working to create ways for advertisers to reach local audiences across all platforms, linear, VOD and OTT.
That resulted in a significant boom for local OTT advertising. An analysis done by MadHive of over 50,000 campaigns across all major DMAs comparing the first six months of 2019 and 2020 reveals a surge in reach for OTT ad audiences, with local OTT ad impressions up 78% year over year.
Our latest TV[R]EV report, Eyes On Local, looks at how this new ecosystem is developing and how local broadcasters and MVPDs are relying on their expertise in the local market to help advertisers reach local audiences across all TV platforms during the pandemic.
To create the report, we spoke, both on and off the record, with over one hundred key executives at brands, agencies, networks, MVPDs, broadcasters and ad tech companies. A few key themes emerged:
The combination of OTT and linear works to the advertiser’s advantage. Each distribution channel has its strengths and together, they can help advertisers reach their desired audience. The trick is finding the right tech stack vendors who can help them to achieve “unduplicated reach” meaning that viewers don’t get assaulted with the same ads over and over again as they switch back and forth between linear and OTT. But once that is solved, the combination can be very powerful. As Tom Cox, President of Premion, and Head of Corporate and Business Development at TEGNA, notes, “From a brand or agency perspective, one of the benefits of combining OTT and linear is that through the linear side you get massive reach, while through the OTT side you can get very specific targeting.”
Lower ad loads on OTT are seen as a major plus: Ad loads on the FASTs, and other ad-supported services like VOD, can be one-third of what they are on linear. That’s a win all around, because as Beachfront CEO Chris Maccaro explains “Lower ad loads are already more attractive to marketers because consumers have a better overall experience when they are not bombarded with ads. What makes that even more attractive for advertisers though is that lower ad loads generally lead to higher engagement from consumers.”
Digital-style metrics present unparalleled targeting opportunities on OTT and VOD: One of the great things about OTT, from an advertiser perspective, is the ability to find and target the exact audiences they’re trying to reach. This is true for local auto dealers and for national car brands who need to target specific consumers within specific locations. That’s where having the right tech partner comes in. MadHive Founder and CEO Adam Helfgott explains that “When we start layering in features like attribution. that’s where it gets interesting: we’re able to see patterns and start designing audiences for our clients. So for example, if there’s a specific app that most of the people in your demo are using, we can analyze what shows the people who use that app are viewing and then we can create audiences out of that data to better target them, either locally or nationally.”
The current crisis presents an unprecedented opportunity for local television to remind advertisers of its value. As advertisers realize the unique targeting opportunities that local television can now offer them, combining both demographics, affinities and geolocation, local TV can take on a newfound importance. As Effectv’s General Manager James Rooke notes, “This is a unique moment in time where a combination of factors including viewership shifts, a phased reopening of states at different rates, and an increased need for campaign flexibility, have placed a renewed focus on the power of local to more effectively deliver audiences for advertisers. Ultimately, if executed on correctly, we could see long-term benefits for local television as a marketing medium.”
As addressable advertising on linear becomes more commonplace thanks to new initiatives from Project OAR, Nielsen and others, as well as the eventual arrival of ATSC 3.0, the ability to achieve even more precise targeting on local will continue to expsnd. That will also make it easier to enable frequency capping, so that viewers are not “over-targeted” by the same ads and to more accurately measure the efficiency and business outcomes produces by locally-targeted campaigns.
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