NBCUniversal said it will begin to use currencies other than the traditional Nielsen demographic ratings to sell commercials and guarantee viewership for clients buying its data-driven ad products.
The new currencies will be customized for each advertiser using the latest version of its Audience Targeting Platform, or ATP 2.0, as part of their upfront buy for the 2016-17 season.
The targeted cost per thousand viewers—or TCPM—will be based on data including information from parent company Comcast’s set-top boxes and NBCU first-party data from sources such as Fandango and Golf Now, as well as third party data.
Some TV companies have been trying to use data as a way to make TV advertising more valuable and more comparable to increasingly effective forms of digital advertising, which appear to offer more precise targeting and a better ability to the sales that result from running an ad.
Last month, Fox Networks Group introduced its Audience Insights Manager and said it would base some ad deals on a targeted CPM.
NBCU has been among the leaders in jumping into the data business. It introduced ATP in January 2015, and it was part of some advertiser’s upfront buys.
Executive VP Mike Rosen said ATP represented about a third of NBCU’s commercial inventory last year and represented every major category.
Those advertisers who bought into ATP last year have been able to have their ad buys optimized each quarter—and some have changed the target they want to reach or the data being used from quarter to quarter.
“It’s not a set it and forget it approach, because businesses change, competitive forces changed, the data gets refreshed, programming changes throughout the year,” Rosen said. “We want the optimizations to be as accurate and as relevant to our clients business as possible.”
Rosen couldn’t say what kinds of results those client are getting but noted “everyone who has participated continues to come back and [optimize] every quarter and want to do it again with us next year, so I think that is a testament to the effectiveness of this approach.”
Nor would he say if NBCU has benefited financially from implementing ATP. “This is all about ways to prove out and increase the value of our premium content to our customers,” he said. “That will always benefit NBCU in the long run.”
NBCU said that ATP 2.0 will offer both linear TV inventory as well as inventory from cable operator VOD systems. VOD "creates an extra layer of precision,” Rosen said, because those impressions can be targeted down to the individual household level.
Like ATP last year, ATP 2.0 will be offered to a “select number of major clients and will represent a significant portion of our overall revenue,” Rosen said.
He said ATP ad buys using the targeted CPMs will be benchmarked against their previous ad buys “so they will always know how much improvement there has been delivering that very precise, customized segment.”
But because each targeted CPM is based on specific needs “every client will be different and every TCPM will be different because of that,” he said.
That price may also be different from what clients paid previously. “The advertisers understand that we’re going to an entirely different approach,” Rosen said.
Those advertisers will also be making a portion of their ad buys the old fashioned way using Nielsen age and sex demos.
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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.