Planners: OTT, Addressable Bringing New Life to TV Ads

Related: Top Media Strategists and Planners

For the advertising industry’s top strategists and media planners, new technology is creating new ways to reach consumers — potentially making TV advertising even more potent.

Broadcasting & Cable reached out to top agencies to identify some of their outstanding planners — the people who decide how best to reach the consumers who buy their clients’ products.

Innovation in the TV world is giving strategists more options to target those consumers. In response to a questionnaire, the planners said they were enthusiastic about the possibilities of addressability and endorsed efforts to reduce clutter and create better programming environments for TV viewers.

Here are the answers to questions we asked 2017’s top strategists and planners about some of the key issues in the ad business.

Which new forms of TV—over-the-top, addressable, video-on-demand—are helping to reach a significant number of consumers you couldn't reach before?

Cherie Calingasan, senior VP, managing director at Horizon Next: OTT and VOD are two new areas of TV that I have really gravitated to, as they both play a critical role in reaching audiences across multiple screens/ platforms. As ratings shift across platforms, it is critical that we understand total delivery and have measurement techniques in place to ensure we are capturing the true impact. I have spent a good deal of time working with the advanced analytics team to ensure my clients are able to both look at the CPM effectiveness and sales effectiveness of these environments.

Emily Klarfeld, associate brand group director, Horizon Media: Our philosophy is to follow the consumer. As an industry, we’ve gotten smarter about understanding today’s fragmented viewership, and look to these nontraditional video platforms to intercept consumers as they expand their viewing habits. Broadcast, which has seen the most time-shifting, is seeing a lot of success with over-the-top extensions, as are many of the higher-rated cable networks. The diversity of options to consume content are certainly helping brands complement traditional campaigns and extend reach to light TV viewers.

However, the reality is we could always achieve scale with TV, and these new forms of video content pipelines are not adding much additional reach versus what we could accomplish before, but allowing us to capture migrating viewing habits.

Michael Solomon, group account director, OMD: I love what’s happening right now because the growth of these platforms (OTT, addressable, VOD) is giving us the latitude to move them out of “test-and-learn” mode and make them the first step in our video strategy discussion. I’d rather start with customers I know the most about, and where I can start to storytell and sequence, versus starting with scale and slotting in opportunities along the way.

Lauren Thermos, account director and team lead, MediaCom: Every channel has a synergistic role within a well-planned system.

When planning broadcast TV, for example, we always evaluate other forms of video to minimize waste. Consider a large retailer that may not have a national footprint. This means that a store’s proximity to a consumer will influence whether she or he is likely to visit. An addressable TV overlay would give us the ability to target our audience within a five to 10 mile radius of an individual store.

Lauren Tuchalski, director, strategic planning, Mindshare North America: Addressable is one advanced TV tactic that comes to mind, though for slightly different reasons. Specifically, for a baby product that we work with, we know that the core audience of women that we want to reach is under 10 million at any given time, and the individual women in the target are cycling in and out of the pregnancy/new mom life stage. I would say that these are women that we could have always reached before, but what’s different is that now we can do it much more precisely and cost-effectively, and those are major benefits. On the whole, addressable really has the potential to change the game on TV; that’s something that our agency teams are exploring and driving results from across a number of clients.

Michael White, partner, director-communications and strategic planning, MEC: We are finally reaching a point in the industry where the ad tech is catching up to consumer behavior. We used to talk about the need for nontraditional video advertising solutions to reach cord-cutters, but of much greater interest to me are the cord-nevers — the segment of younger consumers who are growing up without ever owning and watching live TV. This segment is set to grow steadily over the next few years, and it’s in utilizing a combination of these new forms of TV that advertisers will most effectively reach these consumers, rather than by banking on any one platform to replace live TV.

The market seems to be making a change from traditional demographics to audience buying. How does this shift affect how you do your job?

Calingasan: We have lived in a world of audiences — not demographics — for quite some time, and the technology and innovation in the video landscape now allows us to target linear video much like a digital buyer would go after audiences. At Horizon Next, we often reference data-powered human understanding, which fits really well with where the landscape is going. Understanding what message and environment to best reach our audience to drive performance is so critical in today’s world. We have developed some great tools that help us optimize TV to maximize audience impact.

Klarfeld: Our planning and investment strategies already go beyond traditional demographics. While demographics are the buying currency, we use target audience information to better inform what and when to buy. Employing tools to identify where the consumer is allows brands to improve targeting and minimize waste without reducing reach. There’s no one-size-fits-all approach, so we look to apply these insights as a filter to understand the right content environments to increase buy effectiveness when delivering messaging to the consumer.

Additionally, Horizon has an advanced TV practice, though not all brands have ventured into this arena to the degree that it pays off on their strategy. Based on my experience on snack brands, CPG-oriented brands have a harder time with ROI in the advanced TV space. Audience buying is often better suited for say, a luxury car company versus a snack brand with wider appeal and lower out-of-pocket cost for the consumer.

Solomon: I think we are just scratching the surface on what this evolution means for how we do our business. I think we’re going to look back on GRP delivery and traditional ROMs work we’ve used to justify our marketing efforts and ask ourselves how we felt good about the decisions we made with limited data and insight. Believe me, I’m all for short-term performance — driving immediate business/sales/insert your business KPI here, is critical for our agencies in serving our clients. But a shift to audience buying isn’t just a currency change. It will make us rethink how communications and efforts, both short- and long-term impact, our customers. Media channels, optimization, creative deployment — the revolution will disrupt them all.

Thermos: The shift to audience buying in national broadcast and cable has further aligned my job with MediaCom’s overall mission to create brand strategies and plans centered on the consumers that clients most want to reach; that makes us channel-agnostic, which is exciting.

Traditional TV has always been about delivering reach but, today, we build scenarios that equalize reach across channels. This enables us to judge how, where and in what combination we can best engage consumers on a one-to-one basis.

Tuchalski: It varies from team to team, depending on the client in question. For my team in particular, I work on a large CPG and when it comes to television, reaching the broad demos that matter most to us is still a key goal, as it proves to drive business results year in and year out. We generally focus on audience buying within digital and let TV do what it does best — reach a mass audience. Instead, the big changes and shifts that we’ve made in our TV strategies over the years have focused more on different types of content and formats, ad frequency, and weaving in second-screening/social chatter alongside our TV plans.

That said, one exception to this rule has been the recent launch of a new baby product, which has a much smaller, more precise target than the rest of its sister brands. So we’ve had to shift our TV audience strategy there.

White: There’s a temptation to say that this shift changes everything for the industry and the role of a strategist, but I’m not sure this is the case. The core function of a strategist remains to provide clients with a deeper understanding of how prospective consumers choose brands and how best to influence them along the purchase journey. In this regard, the shift towards audience buying simply provides us with an even greater ability to address specific audiences at the most opportune time. Without a solid strategic approach, I believe the true potential of audience buying will go untapped.

Many networks are offering less-cluttered environments and ad formats that promise more attention for ads. Are these working for you?

Calingasan: I love this question because I can tell you with a strong level of confidence how each network stacks up against [the others]. I work with a lot of e-commerce clients, and while reduced ad loads are creating a better experience for viewers, my priority is to understand which networks are contributing to increased traffic and business impact. Our analytics team has developed custom models that help us understand the impact of this in real time.

Klarfeld: There are a variety of video offerings that exist to address the shifts in television viewing and provide less cluttered environments in today’s saturated market. We can look to certain formats, such as video-on-demand or networks that offer reduced ad loads, or even the recent adoption of the six-second video format for what can be considered a more “premium” or digestible consumer experience.

We see value in terms of the opportunity for greater attentiveness. And while it’s presumed that less-cluttered environments deliver a more receptive viewer experience to better amplify a brand’s message, I have not seen the research that definitively proves this value. As networks test out new formats, it’s hard to discern if they are actually enhancing or distracting from the consumer experience. We must be concerned about the larger impact that less clutter means less inventory, which has an impact on costs.

Solomon: A slight reduction in clutter isn’t going to do it. I almost wish I never had to have a conversation about “share of voice” ever again. These are lazy metrics, but I do appreciate that networks are challenging their revenue models and are allowing agencies and brands to tinker with it as well. I don’t think I’m alone in thinking these steps seem more for show that our industry can adapt, but we are fooling ourselves if we think it’s resonating with consumers.

Thermos: We build plans to break through the clutter and grab attention, but it’s not that simple. You can have large ad units with 100% SOV, but if the creative, timing and messaging aren’t right, then those ads are unlikely to achieve the outcome we want. We achieve success when all these factors are aligned.

This could mean that standard ad sizes work through programmatic because we have the creative, timing, message and ad unit all working together. Success is less about, “is there an ad or not;” it’s about targeting the right audience with the right message.

Tuchalski: Right now, the jury is still out. For my team and clients in particular, we’ve taken advantage of placing our ads on channels and shows that are shortening their ad load per pod, but with an increased number of pods per show — the question then becomes if that increased number of pods will be a turn off to TV watchers. At present, we’re working to determine if this resonates with certain demos or certain show genres better than others. We’re always looking to reassess and reinvent how we approach and plan media for our clients, so changes in frequency and pods is something that we’re definitely testing and exploring.

White: “Avoid the clutter” is one of those advertising cliches that is likely to stay with us for many years to come and with good reason — the average American is exposed to something in the range of 5,000 to 10,000 advertising messages every day. It’s encouraging to see networks offer less-cluttered environments as a way of ensuring the effectiveness of TV is safeguarded. For one of my clients, we have found that integrations with a natural fit between brand and program are significantly more effective than less tailored integrations. I would urge networks to focus on fewer, more naturally integrated partnerships rather than trying to badge every segment of a show.

There is a debate over the effectiveness of TV compared to digital advertising. What tools are you using to determine where clients should be spending their money?

Calingasan: At Horizon Next, our advanced analytics team is infused within each of our brand teams. I’ve mentioned some custom-built models that guide how we optimize and think about TV, but it is critical to take a step back and assess the holistic marketing picture. We leverage media mix models for our clients that take into account the broader media mix, and provide guidance on optimal thresholds based on ROI by tactic. We also use proprietary communication planning tools (powered by survey data) that complement our mediamix models and identify where to prioritize our next media dollar. It is a combination of art and science, and I believe an ongoing test-and-learn agenda can also help answer questions specific to what tactics contribute to incremental growth (TV plus digital vs. TV alone vs. digital alone).

Klarfeld: The effectiveness of TV compared to digital advertising needs to be evaluated based on each client’s business and media objectives. While we’ve seen media most effective when it works together to amplify messaging and reach consumers across the countless environments in which they’re engaging with content, we take a channel-agnostic approach.

Our strategic planning process is fueled by insight and guided by proprietary tools that help inform from a channel perspective, but also a video optimization standpoint. We approach investment strategy by identifying the touch-points that are going to be most consumed and most relevant to our audience. It’s less of a focus on the specific channel, and about being in the most effective environments to communicate with the consumer in a meaningful way. And as OTT blends TV and digital, TV vs. digital is not necessarily the question any longer, but how we approach a more streamlined buy.

Solomon: We tag and test everything that can be tagged and tested. We have a number of partners across geo-location and other attribution solutions that help us benchmark, optimize and tell us what’s working. And then there’s the traditional ROMs work. From what I’ve seen, adding context/relevance, regardless if on TV or in digital, is what increases effectiveness. Context is what we should be talking about, not performance of channels. If I know something about you, the advertising will work harder. If I know why you’re watching something and a craft a message with that understanding of context, it works harder. It’s that simple.

Thermos: For big brands, TV and digital generally coexist, each playing a different role. The debate as to whether one is more effective than the other is dependent on each client’s target audience and objectives. Our toolbox at MediaCom enables us to build real scenarios that reflect the effectiveness of each channel when it’s part of the whole.

Tuchalski: We conduct a lot of research, both within the walls at Mindshare itself and in partnership with our clients, that we then use to plan our strategies and drive investment. And as part of that, our agency is constantly monitoring and optimizing campaigns in real-time through The LOOP, our adaptive marketing engine, to see what’s performing well, and where investment should be shifted at any given time. Ultimately, understanding “cost of entry” versus “diminishing returns” levels is incredibly important for individual channels, as is understanding how different channels work together. We’re always looking to strike a fine balance and not overinvest in any individual medium.

White: The debate over the effectiveness of TV compared to digital advertising is one of the more tiresome topics that the industry continues to obsess over. The body of quantitative research into the subject shows that at a general level, TV remains more effective at building brand bias while digital channels offer a greater ability to convert interest into action. The tools that I advise my clients to use are those that help them understand the interplay of all the channels at their disposal, from econometric modeling to multi-touch attribution studies. At MEC, we also utilize a proprietary study called MEC Momentum, the largest study of consumer-purchase behavior in the world, to gain insight into which channels are most effective at influencing consumers at specific points of their purchase journey.

What new skills are you trying to master in order to keep up with changes in the TV environment?

Calingasan: Data and technology is critical within the e-commerce world, so staying current on the evolving technology platforms is something I continuously try to master. In a perfect world, I want to understand the consumer journey and what ads they have been exposed to (whether linear TV or OTT) prior to registering on site and becoming a sale. Understanding this at the most granular level will enable us to optimize our buy and tie back to the audience we are trying to reach.

Klarfeld: It’s important to me to stay current on new technologies and track the behavior of today’s fragmented consumer. We need to better understand fragmented viewership, as audiences are spending more time with media, which gives media planners so many options to consider. As content is distributed on a variety of devices and technologies evolve, it will continue to change the way we consume and plan media. We lean on tools to keep pace with consumption and usage, but it’s a fast-paced evolution and it’s a challenge for measurement tools to address the complexities of the expanding media landscape. From my experience, the key is to ensure communication strategies are aligned and working together across platforms to deliver on client’s business objectives, as the industry catches-up in terms of video measurement.

Solomon: I’ve mastered the consumption side — binge-watching across any and all devices has become my new normal. But as it relates to the business, I have really invested my time in understanding the definition and segmentation of audiences capability across the expanding landscape of networks and platforms. Understanding how the sauce is made starts with knowing the right ingredients. I’m betting if you focus there, everything else falls into place.

Thermos: For me, it’s less about building new skills and more about staying on top of the industry and consumer wants and needs. By creating systems that are measurable and accountable, we are always learning and evolving in order to deliver the best results for our clients.

Tuchalski: TV is a tried-and-true sales driver, but declining ratings and changes in consumer behavior have made us think about how we create new, different experiences within the medium. For example, today, you can’t talk about TV without considering second screening behavior, and what that means for connecting your TV buys to mobile and social in a way that’s actually meaningful, not just setting a hashtag in your ad and being done with it.

For example, for the Real Beauty Productions campaign that we worked on with Dove and Shonda Rhimes, creating an integrated social experience was a natural move, since Shonda’s shows garner a lot of chatter on Facebook and Twitter. Not only were we able to drive frequency of our message with those consumers who were watching the Grey’s Anatomy or Scandal finales and participating in the social conversation, we were able to get them to further engage with the brand to watch additional content online.

White: As a strategist, it’s crucially important that I stay informed as to the changes occurring in the TV landscape and for me that’s achieved through a combination of my own research, working closely with the buying team and attending meetings with new technology vendors entering the space. For my role, knowledge is definitely more useful than specific skills. Thankfully, I work with hugely talented planning and buying teams who have all the skills we need to help clients stay ahead of the curve!

Jon Lafayette

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.