This year will finally see the initial rollout of Sky’s AdSmart service, the long-awaited technology that will enable UK advertisers to deliver different targeted ads to different households watching the same programmes through their set-top boxes. But during this long development time, other broadcasters have also set the wheels in motion on targeted advertising offerings, notably Channel 4, which is looking to gain an edge in ads served alongside online on-demand shows.
It’s clear that Sky’s efforts to bring ad targeting to TV viewed live will herald a fundamental change in marketing via TV. It could lead to a greater focus from brands on tactical messages and getting a direct response, as opposed to brand advertising that aims to generate long-term awareness.
But AdSmart’s long-term success is likely to depend also on how able Sky is to meet advertisers’ demands. The prospect of live targeting raises ideas – for marketers, at least – of infinite variations of personalised creative, flexible buying in real-time auctions and, most importantly, less spend directed at smaller segments of consumers. After all, that’s what online targeting gives them.
If Sky’s sales operation doesn’t at least approach this, it could feel like it has over-promised. Meanwhile, Channel 4 should benefit from using its growing database of logged-in users to its large library of free-to-air programmes to persuade advertisers that browser-based web TV is the best way to find a targeted audience.
Whatever the outcome, the tussle goes much further than simply the question of which TV platforms will attract the most ad spots from brands. The real coup for broadcasters would be to get advertisers to integrate data from TV viewers into their marketing from top to bottom.
Brands rely on media owners to provide a large part of their audience insight – media platforms often own the most useful data on individual consumers, as it’s where those people most often engage with content and ads. There are hardly any bigger media platforms in terms of nationwide reach than TV channels, which means they could provide the most comprehensive marketing data of all. The increasingly detailed information that broadcasters collect to target their viewers will also flow back to advertisers.
TV audience data could potentially be the basis from which a large number of brands divide up their customer bases and these audience definitions could end up being applied across all kinds of marketing channels. Given this, data services offered to brands are likely to become an increasingly important revenue stream for broadcasters. Sky already has a wholly owned subsidiary, Sky IQ, doing exactly that.
The advent of AdSmart feels like big news for the future of the 30-second TV spot, but it’s more than that. It’s the start of broadcasters becoming data companies.