By Barry Flynn, Contributing Editor
Speaking on the first day of last weekâ€™s Future TV Advertising Forum in London, John Paul, Managing Director of cable giant Liberty Globalâ€™s recently-formed Advanced Advertising & Data division, revealed that the company was exploring the creation of collaborative relationships with competing operators with a view to building the necessary scale required to roll out addressable advertising.
Paul explained that the division he heads up, which was created earlier this year to explore the opportunities around emerging ad models and data services, planned to roll out â€œdata service capabilities and targeted advertisingâ€ across the 14 countries in which it is present â€“ including 12 in Europe â€“ over the next few years.
â€œIt is about scale,â€ he said. â€œIt’s also about collaboration on the operator side. In the United States, traditionally competitive operators are collaborating to create scale in the market. [â€¦] We at Liberty Global, we are also exploring those kinds of relationships in our markets.â€
While Paul emphasised that â€œfor brands and for broadcasters, national, brand-building, mass-reach advertising is going to remain a valuable part of what we do,â€ he noted that there were â€œsome very interesting changes and movementâ€ in the sources of the funds going into advertising budgets.
â€œItâ€™s very exciting, because I think as we start to look at these, there is an opportunity to crack open advertiser’s budgets that traditionally weren’t being spent on advertising, that were being spent on shelf-space or celebrity sponsorship.â€
Paul argued that targeted advertising has â€œa much more efficiency-based ROI business model. [â€¦] If that targeted ad campaign has moved my goods, and has been effective for me, I will pay differently for that. So I think if you look at advertisers, and the money that’s sitting inside the brands, the consumers on the other side, everything we do we’ve got to think of very differently about.â€
One example was VOD, Paul suggested, â€œwhere there are opportunities inside VOD [â€¦] to change how we put those ads in and how we charge for them.â€ Liberty Global was already partnering with broadcasters in this area, he noted.
Asked if there existed an opportunity for European commercial broadcasters to deliver household-addressable TV advertising separately from pay-TV platforms, Paul said it was a very â€œmarket-by-market answer. You look at a market like Germany, [which has] HbbTV 2.0 around the corner, you look at the UK with Freeview and other platforms â€“ Iâ€™m not sure anyone actually has a good answer for that. [â€¦] Thereâ€™s a lot of investment going into the pay-TV infrastructure and delivering those ads.â€ However, he suggested, â€œany broadcaster operating in a country where pay-TV penetration is low would be looking for alternative ways of making it happen.â€
On the issue of ad-blocking, Paul pleaded for more emphasis on the creative side of ad production. â€œWe do need to think about why people are [blocking ads]. We do need to think about how we are making ads. [â€¦] As these opportunities evolve, if we’re really going to be true to the way people are consuming video, then [â€¦] the way we create ads also needs to be equally creative. So that’s not the dynamic insertion or dynamic creation of ads, it is more a focus on how we make that ad. Is it appropriate for that medium of video consumption?â€