Commentary

Addressable TV: Who Are We Really Addressing?

Media planning and buying professionals have been talking about Addressable TV for decades. Yes, decades. The first mention of it was back in 1980, when the dream of delivering a specific TV spot to a specific TV set based on the profile data contained in that set’s cable box started to look like it could become a reality.
 
Addressable TV is, indeed, here. It delivers efficiency, performance tracking and actionable insights. And it provides for greater accountability overall for a medium that historically has been a one-way communication vehicle.  But I have to ask the question: “What happened to television’s main role in the media mix?” With all of this applied data targeting, what Addressable TV may not deliver is the thing we always looked to television to deliver: mass. Take away “mass,” and I have to wonder what television offers that other digital media options don’t.
 
With about 66 million households, it is true that Addressable TV has come a long way from its earlier days of 8,000 Households in Huntsville, Alabama.  So now the technology is here, and we have some scale. But the fact remains, Addressable TV is a “precision-play” in a world with a lot of other precision-play options. In the new digital and mobile media landscape, what platform doesn’t enable data-driven hyper-targeting and the ability to track and measure results?  
 
What's all the fuss is about?

Does Addressable TV solve a problem for the advertiser, or is it truly a revolutionary offering for the broadcast industry, which has been grappling for the past decade with staying relevant in an ever-changing, data-driven, highly measurable, digital world. Don’t get me wrong, the technology that enables Addressable TV is pretty cool. Depending on the client’s challenge and budget, it can be a valuable tool in the media tool box.

But, in my opinion, it is just that—another tool. Marketers have had a host of options for utilizing data to hyper-target highly relevant messages to the right audiences for some time now. So what does Addressable TV offer that they don’t?
 
Media planners may be looking at Addressable TV as a way to augment an overall mass television buy rather than something to replace it altogether. But, is it the most efficient choice?  Depending on the budget, CPMs for Addressable TV can range anywhere from $50 to $70.  For a similar, highly targeted video unit in the digital space, you might anticipate a CPM range of $30- $40.    
 
Should Addressable TV Be Part Of Your Media Mix?
 
Here are some things to consider when it comes to Addressable TV:
 
·  Is there enough scale in your market footprint? If there are not enough households that are enabled with Addressable TV, then you won’t be able to make much of an impact.
 
·  Do you have multiple niche audiences to reach? If so, then it might be a good option for you. But, make sure the message matches the niche. And remember, additional creative messaging requires additional budget.
 
·  Make sure the CPMs are competitive with other digital options that deliver on your audience. Don’t be sucked into paying too much for Addressable TV if another platform can do the job for less money.
 
·  Multiscreen viewing is a reality today. It’s safe to assume users are engaged across many screens and platforms. Ensure you have the right mix to reach your audience, while leveraging multiple screens to better engage them.
 
Addressable TV offers an opportunity for the broadcast industry to hold onto budget allocations that have been rapidly shifting to digital. But as always, marketers must carefully evaluate all of the tools available to them and consider the role each will play in reaching and engaging the target audience.

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2 comments about "Addressable TV: Who Are We Really Addressing?".
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  1. Claudio Marcus from FreeWheel, December 5, 2013 at 8:39 a.m.

    Addressable TV is the logical evolution for TV advertising because it combines the targeting and measure ability of direct and digital marketing with the storytelling power of TV advertising. And in doing so, it makes easier to integrate and measure the impact of TV advertising across multi-channel marketing efforts. Marketers with direct consumer relationships are already using addressable TV to differentiate targeted TV ad messaging between customers and prospects. And while TV viewing is increasingly fragmented, addressable TV enables targeting of specific homes regardless of what they are watching. TV remains by far the most popular consumer medium (http://www.nielsen.com/us/en/reports/2013/a-look-across-media-the-cross-platform-report-q3-2013.html). Addressable TV simply makes it more effective and accountable for marketers.

  2. Paula Lynn from Who Else Unlimited, December 5, 2013 at 9:27 a.m.

    Addressable TV contributes to prejudice, segregation, stereotyping, big brothers and critical loss of information, knowledge and education.

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