The head of ad sales at one of the largest media companies sees 2020 as the year the ad buying process finally change.
Consumers have been moving to streaming video but ad revenues haven’t followed those viewers.
“What is shocking is the industry's inability to get to it already,” Linda Yaccarino, chairman of advertising and partnerships at NBCUniversal said during a panel at the Consumer Electronic Show Wednesday in Las Vegas.
“The consumer is driving this change. What has been so frustrating about the leaders in the industry has been the acceptance of the status quo and the unwillingness of the industry to reflect that consumer behavior,” Yaccarino said.
“We believe 2020 is the inflection point,” said Jeff Green, founder and CEO of The Trade Desk, which works with NBCU. “It is the year that connected television changes everything about TV forever. Everything to this point has been a dress rehearsal.”
The Trade Desk is a programmatic platform that helps advertisers reach targeted audiences including on connected TV platforms.
Consumers are more willing to watch relevant ads, and marketers have shown some willingness to pay more for relevant ads, Green said. “That is the only way we will be able to continue to fund what we are experiencing right now, which is the Golden Age of television.”
Yaccarino said TV commercials today are largely sold the way they were 50 years ago and that’s made it difficult for marketers to find consumers they want to reach when those consumers watch over-the-top or on connected TV.
“I would argue that's because as an industry we haven't given advertisers the right mechanism or opportunities to actually purchase the ads that they want that would continue to fuel the ad-supported ecosystem,” she said.
NBCU is rolling out what it calls One Platform, a system that makes it easier for advertisers to buy and plan media buys across NBCU’s TV and digital assets.
“We are throwing the gauntlet down to where the industry was going to make a very accelerated shift to giving marketers choices to find those audiences on any screen, anytime, where ever. That’s what we’re working on together,” Yaccarino said.
For NBCU, the new ad sales platform comes as the company prepares to launch Peacock, its new streaming platform, which will be largely ad supported.
“The data is clear that in a relevant, limited-ad situation. the consumer is very interested in the power of free," Yaccarino said. “Let’s remember that that's an accepted commercial relationship between the consumer and the publisher who's giving them great content.”
At a time when many consumers and their wallets are experiencing subscription fatigue, Yaccarino said viewers are anticipating a great experience with ad supported streaming products.
She didn’t think that streaming viewers had to be retrained to watch commercials. “I think they’re going to actually look at this as a benefit. They know they’re in the driver's seat and they’re going to say ‘they listened to me.’”
Premium content delivered over-the-top gives marketers access to digital like targeting without worrying about online content that may not be brand safe, she said.
“If I get an ad that's attached to a cultural phenomenon like This Is Us, a cultural mainstay like SNL, I remember it, I'm affected by it and I go out and buy stuff. So as you can see, we're pretty bullish on the future of a bottle incidentally,” Yaccarino said.
Marketers also benefit now that media companies like NBCU have better data about the impact ads are having on consumer buying behavior.
“So the future of television looks like this: as a consumer you will see way fewer ads than you have seen in linear television. They will be way more relevant to you and your household,” said Green.
“It's going to look more like what Hulu's done where you have lots of choices. You can pay a lot [to] have no ads or you can pay a little bit have a few ads,” Green said. “I think the consumer is about to have a whole bunch of choices and I think content is going to continue to get better and better because it’s getting more and more competitive.”
Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.
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