Article 1 of 4 in a series by Stu Carr, director of customer insights, Adgile
IAB Australia last month released the latest Video State of the Nation industry survey, an annual report of the collective views from agencies, trading desks, and DSP’s on everything video advertising.
One of the biggest issues highlighted in the report was the continued, and growing, disconnect between the role of TV/video advertising and the way it is bought and measured;
The overwhelming objective for TV advertising was said to be Brand Building, yet the metrics to determine success continue to be lower funnel ‘performance’ measures.
With daily connected TV audiences growing by 18% YOY (Nielsen) and BVOD advertising investment flooding in, the mismatch between what advertisers need, and what advertisers get, is becoming a major problem for the advertising industry.
The BVOD blind spot
Whilst the technology delivering TV content is changing, viewers continue to watch TV in much the same ways; collectively, on the big screen at home. Yet the decades of scientific research into how to best deliver a TV campaign are not being applied to BVOD.
The reasons why 60 years of accumulated knowledge are absent from BVOD are largely down to two factors:
1. Technology: AdTech powering BVOD remains an unaccountable black box
The programmatic tech powering BVOD buying and selling was originally designed for static display, which typically plays the opposite role to TV. This means the core architecture of the systems, including the logic and algorithms that dictate everything from what advert to show, to what levers traders are allowed to pull, is geared towards immediately measurable outcomes that are at odds with ‘Brand Building’.
The original purpose of this technology was to allow publishers to sell the left-over inventory that no-one wanted to buy. This was successfully achieved by genuinely adding value, via data overlays, but also by obscuring detail about the (unwanted) placements. Fundamentally the technology operates under a cloak of invisibility, for no other reason than by design.
Not only are the levers required to apply TV best practice absent from AdTech systems, the information required to inform these decisions is not available.
2. Team structures
BVOD teams are separate to Linear TV teams in 80% of agencies, based on this year’s IAB findings.
The transparency of Linear TV means TV traders are being held accountable to empirical marketing learnings, and this shapes every aspect of the Linear campaign delivery. On the opposing side, BVOD teams are at the mercy of vanity efficiency metrics forced upon by ad tech systems.
Simply put, the majority of BVOD activity is run like performance banner campaigns, producing significant wastage and not delivering on the brand building objectives.
Advertisers and agencies have little visibility into the issue, with the information vacuum being filled by vanity metrics adding further wastage.
The BVOD wastage problem
Adgile analysed over 1 billion BVOD impressions, from 102 campaigns, run in the last year by many of Australia’s largest TV Advertisers. Guided by well-known evidence-based marketing principles, an assessment of behavioural responsiveness and commercial impact enabled Adgile to identify major gaps between TV ‘Best Practice’ and current BVOD delivery.
Here are the key findings:
1. Creative & Role: BVOD is being used more for sales-activation, but brand building ads on BVOD perform better
Vanity efficiency metrics are prioritising the use of ‘performance’ orientated creative, contrary to the stated role of the BVOD campaigns. Adgile’s analysis supports landmark studies by Les Binet and Peter Field, proving that advertisers need to seek the right balance between brand building and sales activation creatives to deliver optimum BVOD outcomes.
2. Targeting: BVOD campaigns perform better when targeted en masse… but segment-based targeting is rife
The programmatic ecosystem promotes the use of data overlays and hyper-targeting, whilst seminal research conducted most notably by Andrew Ehrenberg and, in turn, Byron Sharp demonstrated why advertising delivers the best business outcomes when reaching the broader category, rather than when confined to tight audience targeting. Adgile’s analysis shows that segment-based targeting performed worse than broader mass targeting.
3. Frequency: BVOD frequency is too low… but it’s also too high.
Frequency caps, amplified by the desire to use BVOD principally for incremental reach, is delivering a huge number of impressions to users at a very low frequency.
Adgile’s analysis shows that low frequencies drove lower responsiveness, whilst on the other hand Adgile’s analysis also shows rapidly diminishing returns from too high frequency. Linear TV is planned with a minimum frequency target and a least wastage goal, something our data shows that BVOD traders should be better enabled to adopt.
(This article is the first in a series of four. Findings from Adgile’s aggregated BVOD analysis will be uncovered in detail … and what that means for advertisers.)