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Why Media Waste Is the Enemy of Value

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(Image credit: IronHeart via Getty Images)

Advertising spending on CTV and all forms of premium video continues to grow. Most Americans have shifted their viewing habits, and marketers are right now determining how to best follow the consumer with their ad buys. But this remains a tricky proposition because planning and buying remain heavily siloed, creating a lot of waste and, ultimately, undermining TV’s potential value. Here’s why that’s happening, and what advertisers must do to adapt.

How big is the media waste problem?

Amobee's Tim Spengler

Guest blog author Tim Spengler is general manager of advanced TV solutions, Amobee.

As Peter Drucker famously said, “you can’t manage what you can’t measure.” When it comes to media waste, no truer words were ever spoken. The problem is front and center for our industry, but for the most part, brands and agencies aren’t able to quantify media waste.

In fact, the majority of marketers and agency executives both report being in the dark when it comes to measurement and targeting. A recent survey of this group found that their number one concern is reliable cross-screen measurement (57%), followed by targeting the right audience (53%). No surprise, these two numbers are directly linked. If you can’t reliably measure across screens in an increasingly fragmented media ecosystem, you can’t be sure that you’re targeting the right audience on a specific screen or platform.

What’s driving media waste?

In a word: silos. Planners and buyers work inside silos and rely on siloed data. Inside those silos, planners and buyers enjoy the illusion of data-driven insights and control. But planners plan off of one metric, and buyers buy off of a different one. And in today’s incredibly complex marketplace, this does not work. The only way to bridge these two worlds is via technology. A common technology platform is really the only way now to break down the planning/buying silos and unify the audiences that are being planned and being bought.

Otherwise, what happens inside the silo stays inside the silo, causing advertisers to struggle to see their whole audience and understand how those audiences move between screens and platforms. Audiences don’t live inside silos, they’re fragmented because consumers follow the content they want to watch. But if advertisers ignore this simple fact, their siloed, data-driven media plans will continue to create waste in two ways.

Too much frequency……...not enough reach.

Sixty-two percent of linear TV viewing today happens via 20% of people. And this happens without a guide to help understand who you are likely to reach and how to complement that to find others in your desired target. You may have smartly used data to identify who your target audience is. But without technology, you’ll keep running into that same 20%. That heavy TV viewer, who, by the way, will start to get annoyed at how many times they keep seeing that same ad. Having a negative effect on their perception of that brand. 

Almost 30% of U.S. households are cord-cutters or cord-nevers. Barring a few exceptions, these groups do not have the ability to see your ad if it runs on cable TV. That’s a lot of people. Knowing who they are, where they are, and marrying that back to the ones that you will likely reach on linear- “linear-aware” is what drives the optimal result. Technology does this. It combines the WHO you want to reach with the WHERE you are going to reach them. 

It’s data and technology working together that gets this done.

Technology breaks down silos and unlocks data’s true value.

Everyone knows silos are a problem, but they persist for two reasons. First, change is always hard. Second, our industry, and society more broadly, face big challenges that often consume whatever bandwidth we might otherwise use to build for the future. The good news is the technology needed to measure and understand audience flow across screens is available and has been used in digital for some time. Advertisers and agencies don’t have to reinvent the wheel here, but they do need to bring that digital mindset to TV. Not from the perspective of “everything is going programmatic, it’s all X's and 1's”. Content and context are still very important. So are sponsorships. But without technology bringing this all together, you’ll get a suboptimal result. Technology is needed to break down silos internally, manage the complexity, and unify your buying activity to maximize your results.

How many of us work for organizations that have openly acknowledged the media waste problem, spoken candidly about how silos make it worse and encourage candid discussions about how to move forward? Chances are, many marketing organizations and agencies haven’t surfaced the media waste problem to the point that it lives inside the consciousness of the enterprise. But once we acknowledge the issue and look for a better way forward, then you are halfway home. 

The time for change is now. The majority of media dollars are still allocated via upfronts. Planning for 2022 begins soon. Let’s commit to the following for next year. First, promise to think like consumers by adopting an audience-centric (channel-agnostic) mindset. Second, commit to maximizing the combination of technology and data for unified planning and buying by running meaningful tests, learning as you go, and applying those learnings at scale. Technology breaks down silos and unlocks data’s true value. Once you deploy it on your premium video investments, I have no doubt that you will be happy with the results. ■

Tim Spengler

Tim Spengler is general manager of advanced TV solutions, Amobee