At Future TV Advertising Forum last December, Irwin Gotlieb, Global Group Chairman at GroupM, was outlining his hopes for more addressable TV inventory and that the television industry will make this inventory simple and cost-effective to buy. Would he like to have access to addressable inventory from every broadcaster, via every platform, through a joined-up ecosystem? “That would be really nice,” he admitted, before adding that he would settle for half of that, or even baby-steps.
In that specific context he was talking about household-level addressable TV advertising via set-top boxes, and he was talking about all markets. In the UK, there is certainly progress in this direction. Sky Media keeps adding Sky AdSmart enabled channels, making it easier to buy more targeted audience via its sales house (including for linear). The announcement that Sky and Virgin will create a unified addressable inventory pool, across their respective STB footprints and sold via Sky Media, means scale can be increased further.
However, it has become clear that GroupM has a bigger vision, and it includes the unification of all inventory sources where it is possible to target against an audience watching TV on the big television screen. That means set-top box inventory from Pay TV operators (like Sky and Virgin Media in the UK). It means STB inventory on free-to-air platforms when they are enabled for TV targeting. And it means connected TV inventory, and especially targeted ads within broadcaster streaming services that are served via devices like Roku boxes, Apple TVs, game consoles and Smart TVs.
Thus GroupM unveiled Finecast this week, a new company focused on creating a unified access point (covering planning, trading, execution and reporting) for advertisers who want to target consumers on all television sets in the UK via what is effectively a single buy. Its aim is to consolidate addressable-enabled audiences across multiple TV delivery platforms (covering inventory from different content owners, and working on all necessary device types). Finecast wants to encourage industry collaboration so that the different audience targeting, ad insertion and reporting technologies can be harmonized to make all processes easier.
At its heart, Finecast is an ad decisioning engine, using a customised version of the Videology decisioning technology. It also has access into a data management platform that encompasses, among other things, reporting and analytics. The decisioning engine integrates with TV platform ad serving solutions, which in turn deliver the ads.
Initially, Finecast is focused on the UK (because it has strong Pay TV penetration, strong growth in on-demand viewing and advertisers are becoming more expectant when it comes to addressable). Finecast will expand its efforts to all major markets as they become more addressable-enabled, one territory at a time.
Today Finecast serves GroupM agencies but the company has not ruled out opening the platform to other agencies. The Finecast system is live and the company has already run 150 addressable TV campaigns for 74 different advertisers. Finecast already has access into:
- Simulcast streaming of live broadcast content on TVPlayer (the UK-based online aggregator of free-to-air channels and a selection of pay channels)
- Simulcast streaming of live broadcast content on STV (the Scottish commercial broadcaster)
- Broadcaster VOD from Channel 5, Channel 4 and STV (via their player services)
- VOD on Sky set-top boxes
- VOD on Virgin Media set-top boxes.
Some of the channel owners whose content is available as VOD with addressable advertising, via Finecast, are: Sky Arts, Sky Atlantic, Sky 1, Sky Sports, Cartoon Network, CNBC, Disney Channel, National Geographic, Fox, MTV and Dave (this is not the full list). The partnership therefore already encompasses all the major UK sales houses except ITV Media (i.e. content owners represented by Sky Media, 4 Sales, Turner Media Innovations and STV are partnered with Finecast in some form).
There is currently no access into to Sky AdSmart linear addressable inventory (currently the only addressable system covering linear channels on broadcast infrastructure in the UK). ITV inventory is also missing from the list. The UK’s largest commercial broadcaster does not have any addressable advertising on broadcast TV but did start replacing ads with demographic-based targeting for live streaming via ITV Hub last year.
At its launch, Finecast was bullish about its prospects of achieving the comprehensive inventory unification it wants, and stressed its very strong relationships with Sky and ITV. There were no warnings that we should expect some key inventory owners to abstain. Nick Theakstone, CEO of GroupM UK, said: “Sky is one of our biggest clients. We have a progressive and forward-thinking relationship and want to help each other, and we want to move that relationship on.”
Some of the other facts about the Finecast launch are:
- The company is focused on television screen viewing; it is not involved in targeting TV-related ads to smartphones, tablets or laptops.
- It is focused on addressable advertising (i.e. household-level targeting) rather than just data-optimised buying against linear or VOD content on the different platforms it is integrated into.
- It will provide access to both VOD and linear inventory.
- GroupM clients and agencies can still make addressable buys directly with broadcasters and platform owner sales houses.
- The company has its sights on the free-to-air broadcast market, not just free-to-air broadcasters when they are streaming their video. HbbTV 2.0.x is viewed as one of the technologies that could help drive addressability there, Rich Astley, Chief Product Officer at Finecast, revealed.
- Finecast is also viewed as an ecosystem that can help broadcasters fully exploit demand for targeting without having to rely on broadcast platform owners. This refers to connected TV streaming via direct-to-consumer apps.
- The ‘streaming-to-TV-sets’ market (connected TV) is viewed as an important growth area, partly driven by devices like Roku and Amazon Fire that provide high video quality for relatively low device prices.
“The addressable market is about to get very interesting. There will be more ways to do this,” Astley declared. “We will be looking to partner with anyone that enables advertising insertion,”
It is early days for Finecast but this launch is very important because of the scale of its ambition and the company behind it – the world’s largest media buyer. The Finecast leadership is: Jakob Nielsen, CEO of Finecast, Rich Astley (Chief Product Officer), Kelly Clark, Global CEO at GroupM, and Irwin Gotlieb, Global Chairman at GroupM (who has been working on the project for several years).
Here are some other value-adds that Finecast believes it will deliver:
For the buy-side:
- The power and desire to encourage platform operators to collaborate with one another and for broadcasters to work with platform owners to create a larger combined addressable ecosystem and so give buyers the audience scale they want.
- This system will make it easier to buy targeted audiences in a market that otherwise is going to be very fragmented if you want to gather up all the available audience pools (across broadcast FTA, broadcast Pay TV and streaming services). “Simplification is worth a lot in this fragmented world,” Jakob Nielsen comments.
- The company is encouraging the use of common data sets across the different supply-side providers, making audience segmentation, planning and reporting, among other things, easier.
- A currently unique ability to provide a holistic view across inventory found on multiple platform types, which also means the ability to control reach and frequency more precisely.
- VOD consumption is growing, especially on the big television set, and marketers can aggregate targeted on-demand inventory across many platforms and wrap that into a bigger targeted audience buy that includes linear (across many platforms).
- An ability to forecast how many target impressions an advertiser will be able to achieve in a given time frame, at a given price. Finecast will know how many impressions it can expect across set-top boxes and Smart TVs, for example, and add these together. The unique selling point is that this should eventually apply across the entirety of the addressable TV enabled population (in a territory).
- A wider initiative to help make addressable TV a more integrated (and eventually standard) part of the media planning process, so it is easy to allocate X% of the TV campaign budget to traditional linear and Y% to addressable.
- What is claimed to be the largest source of audience data that can be applied to targeting, which includes all the necessary third-party data partnerships (like with Experian). Finecast can integrate first-party advertiser data and has the know-how to create custom data-sets. Astley says Finecast has already spent a lot of time looking at what data-sets clients want to apply to big screen TV targeting.
- Finecast gives buyers access into targeted inventory that is inherently brand-safe and viewable, because it is television served on television sets.
For the TV advertising ecosystem as a whole:
- GroupM has the carrot that can help persuade the TV industry it is worth collaborating: as a huge buyer that has pioneered TV targeting (its MODI Media operation in the U.S. led the way in helping clients work in addressable), it can drive demand for addressable inventory in Europe and elsewhere. Jakob Nielsen made it clear that there is lots of interest from clients in the Finecast proposition, and he inferred that as all clients have innovation budgets for marketing, these can be directed to addressable TV.
- The company has been trying to take care of complexity at various layers, including working with different SSPs (supply side platforms), yield management systems and ad management systems, for example. “None of them currently talk to each other or cleanly integrate in a way that you find in digital display,” Rich Astley comments.
- The company has taken responsibility (and is paying for) for the various custom technology integrations across different devices so that the Finecast solution can reach viewers with dynamically inserted ads. With more devices being added all the time for streaming video to TVs, this is an ongoing process.
- GroupM’s ownership in various core addressable technology providers, including INVIDI, means Finecast has an understanding of the complexities involved in addressable TV advertising. Its expectations for what can be achieved, in terms of harmonisation, should be realistic.
- Perhaps the most dramatic contribution to the wider TV advertising ecosystem is a new consortium that Finecast will help to launch that will focus on improving measurement of TV viewing that is not currently picked up by BARB (the panel-based ratings that are the basis for the UK currency). This is intended to extend what BARB offers the market, focusing on census-based data. Jakob Nielsen expressed the hope that the resulting measurement system could eventually be adopted by BARB themselves (we will report on this separately).
GroupM believes strongly in the power of TV as an advertising medium and at the Finecast launch, Adam Smith, Futures Director at GroupM, noted the importance of context/environment for brands, and the proven impact of TV advertising. TV delivers the best value if you are measuring consumer response against cost, and it has the shallowest decay curve for brand awareness [i.e. consumers forget you and your brand values more slowly after TV advertising compared to other advertising], he said. “TV has the best rate of return for incremental investment.”
It was clear that GroupM as a whole is worried that brands, in their search for targeted media, could end up choosing lower-performing media. That explains its desire to make TV more targeted. It wants to combine the power of television context with addressability and it wants TV to perform a wider range of functions including: mass-awareness, high-reach marketing; targeting as an extension of reach (including for awareness marketing); and targeting to achieve lower-funnel objectives like improving consideration or even transactions.
Jakob Nielsen predicted that in the long-term, 30-50% of the total market for TV advertising will be for addressable TV. Thus Finecast will not be the conduit through which all future TV advertising runs, but a place where some of it goes, and a place where sometimes one part (the targeted part) of a wider campaign (that is also reaching everyone without addressability) is organised.
“Our clients still need big reach campaigns,” Nielsen declared, pointing out that Mercedes still has to create a lifelong desire for its cars among children, not wait until they can afford one at 40 years-old before advertising to them. Adam Smith noted that TV is losing some reach, notably into the 16-24 age group, which explains why some advertisers (like in the personal care sector) have chased them into Facebook. He believes TV can use data and targeting to compensate for any losses in reach.
Nielsen declared: “TV is a fantastic medium and we think TV [as an advertising solution] is going to grow in total, but it will look different. We will see a combination of mass-reach and narrow addressable TV – that will be the future of TV.” He then emphasised the importance of context [quality content that engages viewers and delivers better ad viewing rates and attention] and the potential for marrying this with better data and targeting tech.
He repeated predictions that Amazon or Facebook might bid in the next rights auction for the English Premier League, noting that online giants have a data and tech focus but currently lack content. The inference is that someone is going to combine great content with data and targeting and the broadcast industry needs to do it first. GroupM believes that Finecast will make this easier for the TV industry, with its attempt to create a unified addressable ecosystem.
Returning to what Irwin Gotlieb said at Future TV Advertising Forum in December, it is worth noting how adamant he was that, as a buying group, GroupM wants TV targeting to become not just easier but more holistic. “We aggregate reach across not only all broadcast channels but across all media categories. I cannot deal with individual vendor siloes where someone comes up with a targeting scheme for one channel. It is kind of pointless,” he declared.
“I need to de-duplicate across channels. I need to aggregate reach properly and professionally. To me, an individual vendor datamart (data market) that is focused on their inventory silo is pretty much a non-starter, and I think anyone else in my position in this industry [a buyer] would agree with that view.”