Home Analysis Putting an end to audience under-delivery and make-goods, and over-delivery with its...

Putting an end to audience under-delivery and make-goods, and over-delivery with its wasted inventory

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Not every game-changing ad-tech innovation involves addressable TV or programmatic trading. xG GamePlan from Imagine Communications focuses on efficient allocation of inventory to different advertisers to ensure their audience targets are met, with the aim of avoiding audience under-delivery or over-delivery. At one leading media owner, double-digit improvements in inventory efficiency have been achieved for broadcast TV alongside an 80% reduction in operating costs associated with inventory planning, allocation and re-allocation.

These sell-side improvements rely on a shift from spot buying to audience-only guarantees as a starting point. That means advertisers have to trust a broadcaster to deliver them a given volume of their target audience, over a certain period, by using the channels, programmes and dayparts that the broadcaster chooses. This contrasts the approach where a buyer chooses particular programmes or ad breaks, for example, believing these are the places where they will find their target audience, with the broadcaster tasked with delivering the target audience (at the volume required) within these agreed spot-based ‘rules’.

Audience-based guarantees provide more flexibility; they free the broadcaster to make mid-campaign or last-minute decisions like, for example, giving the first spot in the first ad break in popular Programme X to a different advertiser than the one it was originally scheduled for, because the original advertiser has already achieved its audience goals three days earlier than expected, or is now forecast to hit its goals within the next week even if it is allocated less inventory.

If the broadcaster was selling spots and not just an audience guarantee, the spot in Programme X would be served to the original advertiser, according to the plan, resulting in audience over-delivery, in this example. For the broadcaster, over-delivery is wasted inventory. They did not need that spot to meet the audience goal they promised, and they could have used it to help meet somebody else’s audience goal.

xG GamePlan is an inventory planning and optimisation solution that enables this shift to audience-based guarantees, away from spot-based buying, and uses this new-found broadcaster freedom to dramatically improve inventory efficiency. For the broadcaster, the benefits are:

  • Eliminate over-delivery of audiences and so avoid wasting inventory on campaigns that do not need it, and instead sell that inventory to other advertisers, leading to higher total yield for linear TV.
  • Eliminate under-delivery of audiences, so avoiding the resulting phone calls and emails to agencies and clients that stem from this, which is a costly waste of time.
  • Eliminate the make-goods (ads given to advertisers free, as compensation, in order to ‘make-good’ the audience deficit) that amount to a cost to broadcasters, since that ad spot could have been sold to someone else.

The buy-side also benefits from more efficient inventory allocation, because nobody wants audience under-delivery, which undermines or slows down campaign objectives, and nobody wants the hassle associated with under-delivery (i.e., make-goods and the re-planning that is necessary). Buyers get the audience they wanted, when they wanted it.

Imagine Communications has supported audience-led (rather than just spot-led) buying for more than a decade via its Landmark ad sales and commercial scheduling system, but it was the introduction of xG GamePlan three years ago that paved the way for the super-optimisation of inventory allocation. xG GamePlan harnesses the AWS cloud to enable data-crunching that was simply not possible before.

Thanks to cloud processing, this product can completely reschedule an entire inventory allocation plan (that stretches weeks or months into the future) every day, drawing on the latest audience measurements coming back from the local TAM (television audience measurement system) or from Pay TV operator audience measurement panels and set-top box viewing data.

It is these audience figures that enable the system to recalculate campaign status. Thus, a couple of big shows may have performed better than expected, so various campaigns are now ahead of where they were expected to be at this stage. Forecasts can be adjusted based on the latest real-world figures across a swathe of programming.

Other inputs can be taken into account. Thus, if a competitive broadcaster launches what is expected to be a flagship show, and it hits screens in three weeks’ time opposite one of your own popular series, this could mean a reduced audience forecast for your series.

The inventory allocation recalculation, in the cloud, makes use of massive computer power combined with parallel processing. That means xG GamePlan can run multiple planning scenarios, taking account of different KPIs. The system then compares all the outputs before deciding on the best one. So, every day, a broadcaster can run an elite race between different scheduling options to find the best possible reallocation, with that re-allocation completely automated.

Imagine Communications testing shows that this cloud-based solution is capable of booking over 31,000 commercials per minute based on 2.5 million optimisation calculations.

Graham Heap, Senior Director, Product Management, at Imagine Communications, says the system “course-corrects” itself to right-size campaigns. “If you have campaigns that are over-delivering, you can bring that down to 100% of target,” he points out. “And you let the machines do the work.”

“The seller makes better use of their inventory, delivering their audience commitments using less of it. If they can find the audience with less waste, they can free up airtime for promotions,” he says, giving a popular example of what can be done with spare inventory, especially if there is no time to sell it.

If there is no option to sell the inventory, and the content marketing team do not want it, then you can always ditch the spot altogether. “Then it is a case of improving the viewing experience by reducing ad load,” Heap explains.

Turning to cost benefits, rather than inventory efficiencies, Heap contrasts the automation within xG GamePlan with what he calls “hand-cranking schedules” to fix problems, like when an advertiser is not getting the audience they were promised. “There is a big benefit to sellers in terms of the time and effort spent placing spots and course-correcting due to problems with delivery, and having to make-good. In some markets, those ‘operational costs’ are astonishing.”

Even buyers benefit from this improved ‘administration’. “They don’t have to talk about make-goods and spend time pinging broadcasters about under-delivery,” Heap notes.

Heap is a fan of audience-based buying, believing that it achieves advertiser objectives but in a more efficient way than spot-based buying. He points to over-demand for primetime, or for Sunday football, despite the fact that the audiences watching at these times can be found in other places and times. “If you can [are allowed to] find the audience where they are, you can use inventory better, and it will boost the available inventory,” he states.

Audience-based buying does not mean advertisers pay the same for the target audience wherever they are found. Target audience X can be priced higher if they are found in the football than if they are found in a late night slot. The value of context is still factored into the trade but there is more flexibility about the spots a broadcaster can allocate (and the prices paid for them) within the budget available.

One publicly announced customer of xG GamePlan is Nine Network in Australia, one of the commercial TV giants in that market with four over-the-air channels covering five markets, plus the 9Now streaming service. It is Nine that has reported double-digit inventory efficiencies and an 80% reduction in the cost of trading thanks to the combination of audience-based buying and constant planning schedule optimisations.

xG GamePlan is a key component in the 9Galaxy automated TV trading platform, a flagship innovation that helps Nine move towards automated, audience-led buying.

All the key xG GamePlan features can be seen in action at Nine including ‘Inefficient Spot Removal’. This takes changing audience ratings predictions and decides if a spot previously placed in order to deliver a specific demographic is still optimal. If it is no longer the most effective placement, the placement is cancelled, with the campaign targets adjusted to reflect this and fed back into the optimiser.

Nine is also using the ‘RightSizer’ feature to address campaigns that are over-delivering on ratings delivery targets by a certain percentage. The least efficient campaign spots are cancelled until the campaign delivery is reduced to within a desired percentage range.

Imagine Communications provides a clear technology roadmap for existing Landmark (sales and scheduling system) customers to cloud-based inventory management, optimisation and audience-led buying. Indeed, it was announced in February that Sky Media, which has an existing on-premises Landmark sales system, is working with Imagine Communications to move this application into a cloud-based, fully managed service for cross-platform campaign sales management, inventory optimisation and adaptive audience fulfilment.

Adaptive audience fulfilment is the term Imagine Communications uses to describe the idea of selling an audience rather than specific spot times while adjusting where spots are placed, in real-time, to ensure the promised audience targets are met.

The five-phase project that has been announced has Sky Media’s One Campaign at its centre. Already live, One Campaign allows advertisers to buy a single campaign that is delivered and measured holistically across multiple platforms, including linear and on-demand, and receive one invoice. The new project involves the introduction of xG GamePlan, with the expectation that a cloud-native booking optimiser “brings improved efficiency to audience-based campaigns to reach target goals with less inventory”.

“With xG GamePlan, Sky Media can plan even last-minute campaigns accurately and effectively, ensuring all opportunities are monetised without over-delivery,” the companies said in February.

Talking about xG GamePlan generally and how Inefficient Spot Removal can be used in the field, Graham Heap says the system would allow a channel group to strip out every booking and recalculate everything, every day, if they wanted it to. In practice, customers are more likely to strip out the 10-20% least efficient spot bookings and leave the rest, then perform the same process the next day. “You can choose how aggressive you want this to be.”

He says one of the original motives for Imagine Communications to develop xG GamePlan was to help a customer increase their channel count, and therefore their spot count, without growing the cost of inventory management by the same proportion. “It was operational cost savings that drove us to develop this, but it turned out that they made more money because they used the inventory better.”

xG GamePlan works with third-party trafficking systems. Nine Network has its own in-house solution for trafficking, for example.

Heap reckons the shift towards audience-led buying is a multi-year journey for any given market, but there are no technical barriers to this, with media owners now comfortable entrusting sensitive processes like inventory allocation to the cloud, for example. The main factor determining how fast this can move, he believes, is the attitude of buyers – whether they are ready to accept audience commitments without guarantees about particular spots.

He emphasises: “Australia provides a good model for how the sell-side and buy-side made this move. You don’t flick a switch and move from trading on spots to trading on audiences overnight. One approach is to go to big international buyers who are used to this [buying audiences on digital] and engage with them, and introduce a hybrid model where you trade spots and audiences so you can see the relative merits of the two approaches. Work with ‘friendlies’ on the buy-side to run trials,” Heap advises. “This is not a binary choice.”

“Where this is all heading,” he predicts, “is linear [broadcast] TV being traded on audiences. Today, people are buying impressions on digital, and if you are buying spots on television it is hard to stitch that [the TV/digital audiences] together. If you can make linear TV audience-based, it will be much easier to stitch everything together in a cross-platform campaign. Creating that holistic environment is the next step.”


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