ADVANCED LINEAR TV ECOSYSTEM:
A BYTE-SIZED OVERVIEW
WHAT IS THE ADVANCED LINEAR TV ECOSYSTEM?
Earlier this year, we published our first Knowledge Lab on Advanced Linear TV Advertising. As noted then, advanced linear TV
advertising refers to the ability to bring enhanced data and greater automation to the linear TV and video buying and selling process.
While the focus of our first Lab was how the application of data is bringing
greater insight and targeting to linear TV, the focus of this Lab is on the
advanced TV ecosystem—providing a deeper understanding of the new players
emerging as the process for planning and buying TV advertising expands to a
complex web of technology providers, content aggregators and data providers,
as well as buyers and sellers of media.
Advanced Linear TV is often broken into two categories: data-enabled TV, and
addressable TV. The first, DETV, refers to the ability to overlay data segments
on traditional linear TV to more effectively deliver ads to the desired strategic
target; Addressable TV takes data one step further and enables an advertiser to
achieve one-to-one targeting at the household level.
WHAT HAS CHANGED ABOUT TV BUYING?
The linear TV industry is undergoing a seismic change. Marketers today have
the ability to reach more precise audiences on linear TV through the use of
data and automation, and they are eager to dive in. According to eMarketer,
the advanced TV market is expected to grow from $706 million in 2016 to $2.16
billion (3% of the TV market) in 2017.*
However, as opportunities abound for marketers to leverage the new
technology, the processes for procuring and selling TV space are changing
rapidly. As a result, studies have shown that brands, agencies, and media
companies alike are often confused by the new system, and apprehensive about
experimenting in advanced TV.*
Buying TV has historically been based on discussion and agreement between
the buyer and the seller using demographic data, but today’s TV ecosystem
has multiple players, and multiple opportunities for data and automation at
every step. While this has made buying in this new world more seamless,
these expanded capabilities have added to the behind- the-scenes complexity
of the process. Yet a basic understanding of advanced TV workflows can bring
greater clarity to what, at first glance, may seem like an undecipherable web of
acronyms and vendors.
GROWTH OF ADVANCED TV
$2.16
Billion
$706
million
2016
2017
*Source: Mediapost, September 2016
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ADVANCED LINEAR TV ECOSYSTEM
A BYTE-SIZED OVERVIEW
DEFINING THE ROLES:
For players across the ecosystem, it’s a brave new world of TV advertising. While some elements of their job have stayed consistent, many
have changed, and oftentimes this means a growing list of responsibilities. Below, we examine what’s new and not-so-new for the key
players in the TV ecosystem on both the demand and the supply sides.
Demand Side:
Advertisers:
What Hasn’t Changed: Advertisers always have the same goal, whether they are selling soap or selling insurance: to
drive revenue. For many brands, TV continues to be a must-have channel because of the high level of emotion and
brand connection that sight, sound and motion can provide, and this remains unchanged, even in the advanced TV era.
What Has Changed: Fragmentation of consumer video viewing has made it more challenging for marketers to achieve
effective reach on TV alone. The growth of digital channels provides them with more options to reach their audience
with increased data and automation, but also more decisions to make, as they are tasked with making the final call on
whether their TV dollars will go digital, or remain in the more tried-and-true traditional TV realm.
Agencies:
What Hasn’t Changed: Agencies are tasked with bringing the best media options – or combination of options – to
succeed based on their client’s KPIs. They act as the eyes and ears of the brands, choosing the media and partners that
will drive the best results.
What Has Changed: In today’s increasingly digital world, there are many more content providers and technology
partners in the TV space. Agencies work with a roster of outside partners, such as DSPs, SSPs, and MVPD’s, often
leveraging ad technology to help provide the best approach to targeting, data, and measurement, to drive optimal value
for their client.
DSPs:
What Hasn’t Changed: Demand-side platforms provide media buyers with the technology to purchase ad placements
in an automated fashion.
What Has Changed: The role of the DSP used to be limited to the display world, and then the online video world.
Today, DSPs also play a key role for advanced TV, where they are responsible for automating and simplifying an
increasingly complicated ecosystem, as well as adding data for targeting, and intelligent ad decisioning. With a reliable
DSP, advanced TV ad placements can be purchased with just a few clicks.
Supply Side
Media Owners:
What Hasn’t Changed: Quality content has always been the key focus for media owners, as they work to build
bigger audiences to translate into greater revenue. Additionally, it’s crucial that they form the right partnerships and
connections to increase yield and profit.
What Has Changed: While that is still true, media owners today are tasked with driving high yields on a variety of
properties across digital channels. Audience-based selling brings greater complexity to the digital world, but also more
opportunity to drive revenue. In TV, this group is now able to better identify their audience, layering first- and thirdparty data over TV viewing data to offer more efficient strategic targeting at the network, program, or daypart level.
MVPDs:
What Hasn’t Changed: A Multichannel Video Programming Distributor (MVPD) is a type of service provider that
delivers video programming services to the consumer, often charging a subscription fee.
What Has Changed: In the world of advanced TV, MVPDs play a crucial role in making addressable TV a reality, because
they are the only entity with access to a consumer’s set-top box and registration data. Only with cooperation from an
MVPD can a brand reach a consumer on a 1:1 household level.
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ADVANCED LINEAR TV ECOSYSTEM
A BYTE-SIZED OVERVIEW
Proprietary Platforms:
What Hasn’t Changed: Propriety platforms allow for major media owners with large amounts of inventory to
build their own SSP to manage inventory in an automated and data-focused way.
What Has Changed: In today’s busy TV landscape, the ability for media owners to build their own supply-side
platforms provides many benefits. A proprietary platform, in some ways, allows for more hands-on control when
it comes to inventory; however, this approach also restricts the buyer from seeing a complete, apples to apples
view of the landscape.
SSPS:
What Hasn’t Changed: Supply-side platforms refer to technology that media owners use to automate the
process of selling and managing their ad supply. Like a DSP, an SSP simplifies the advertising ecosystem through
automation, and can add data to increase the value of inventory.
What Has Changed: The role of SSPs has expanded, and will continue to expand, as they have access to advanced
TV inventory. Media owners can use SSPs to interface with DSPs, or directly with Advertisers and Agencies, to drive
stronger yields on their TV inventory. Additionally, as both buyers and sellers begin to use technology for media
solutions and inventory management, the use cases for SSPs and DSPs are beginning to see more overlap.
Aggregator Networks:
What Hasn’t Changed: Aggregators have always helped package media across diverse properties to offer scalable
media packages to advertisers. These media networks help bring more depth and breadth to inventory that
would otherwise be available to an advertiser by providing access to inventory across a variety of inputs (i.e. local,
broadcast.)
What Has Changed: Today, a crucial piece of an aggregator’s value proposition is the data and analytics they can
offer. These elements help to drive efficiency and lower costs by providing better targeting and measurement.
The Role of Data
Viewing and Measurement Data
What Hasn’t Changed: Nielsen and comScore (formerly Rentrak) have long been key players in TV
measurement, as they offer a reliable and trustworthy assessment of a channel that nearly the whole
industry agrees to use.
What Has Changed: Nielsen is still the gold standard on which media is bought and sold, but other data
providers are entering the fold with their own strong value props. For seasoned data providers like Nielsen,
their offering has widened exponentially and includes Total Audience Ratings to measure across channels. Meanwhile, comScore
and new providers like TiVo have also become key players, attempting to bring new approaches of household measurement
to the traditional Nielsen panelist-based measurement system. These companies have vast digital capabilities, as well as the
ability to measure overlap for the same consumer on both linear and digital devices. Additionally, one of the newer data types,
registration data, is key to the development of addressable TV.
Data Management Platforms:
What Hasn’t Changed: Data providers and data segments have long existed in the digital realm where segments could be
applied and leveraged by a user’s cookies online to determine which ad should be shown. Data Management Platforms (DMPs)
have always been valuable in their ability to manage and select vast amounts of data in an automated way.
What Has Changed: As TV advertising evolves, the demand side (advertisers and agencies) as well as the supply side (media
and content owners) are looking to provide clients with the ability to get the most out of linear TV advertising placement.
The ability to apply data has existed in the digital world and is extending into TV with the ability to overlay and tie together TV
advertising with real marketing activity either through data elements tracking purchase and customer engagement to the brand
(first-party segments) or behavioral and household attributes found within traditional Data Management Platforms. Applying
data to linear TV helps to deliver that additional layer of targeting that has previously been challenging to achieve when buying
on age and gender.
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ADVANCED LINEAR TV ECOSYSTEM
A BYTE-SIZED OVERVIEW
TV BUYING MODELS IN ACTION
There are a range of approaches that marketers can take for their television advertising strategies. While the traditional TV route is still
the best choice for advertisers interested in broad reach, data-enabled TV offers greater targeting and efficiency of dollars. The third
approach, addressable TV, provides the greatest targeting and the most precise data at the household level, but can come at a cost
since it is guaranteed to deliver to the target audience without any waste.
While using Advanced TV may be relatively simple from a platform user’s perspective, a visual representation helps to explain the
path between buyer and seller in the advanced TV world. Below, we provide a map of steps for an advertiser looking to buy TV in
each scenario.
It is worth noting that in all data-enabled and addressable TV situations, advertising technology plays a key role, and is present
throughout the process (even beyond the individual boxes represented in the chart below.) Likewise, data is flowing throughout the
process and coming from all sides -- from the advertisers and agencies, from the content owners, from the platforms, and from the
MVPDs. In order to run a successful advanced TV campaign, marketers and media companies rely on technology to make the best use of
data, and to drive the process from planning, to management, to execution, to measurement.
Traditional TV
Data-Enabled TV
Addressable TV
Increased Targeting
ADVERTISERS/AGENCIES
TV MEASUREMENT DATA: NIELSEN, COMSCORE
FIRST PARTY, PURCHASE, BEHAVIORAL DATA, AUDIENCE PANEL VERIFICATION
HH SUBSCRIPTION-BASED TARGETING
Demand Side Platforms
Demand Side Platforms
Data
Proprietary
Platforms
1
2A
Supply Side Platforms and
Aggregator Networks
2B
2C
2D
Proprietary
Platforms
3A
CONTENT OWNERS
(Broadcasters & Cable Networks)
3B
3C
MVPDS
(Cable & Satellite Providers)
CONTENT OWNERS AND DISTRIBUTORS
Traditional TV
Data-Enabled TV
Addressable TV
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ADVANCED LINEAR TV ECOSYSTEM
A BYTE-SIZED OVERVIEW
1. The Traditional Buying/Selling Approach
Today, most TV ads are still purchased only on age and gender, through a direct interaction between the
buyer and seller. This approach, which has been in place for decades, has a more simple workflow. The
demographic measurement is applied by Nielsen, and ensures that the buyer is getting what they paid for,
and the seller is informed about what they have to sell.
2. Data-Enabled TV Buying/Selling Approach
With data-enabled TV, media buyers and sellers are able to understand more about their audience by layering
first-party and third-party data over television viewing data. This way, their TV campaigns are able to more
efficiently deliver against a strategic consumer target.
Data-enabled TV campaigns may be purchased/sold through a variety of approaches, which leverage more
advanced data than traditional TV buying. This may include a client’s own first-party data, purchase and
behavioral data, or audience panel verification from a third-party like comScore.
There are several scenarios possible when buying/selling data-enabled TV:
2A.An advertiser or agency transacts on specific inventory through a variety of proprietary platforms
belonging to a media/content company to purchase inventory
2B. An advertiser/agency chooses to work through a DSP, such as Videology, who brings together a variety
of inventory sources into a single platform and can layer on advanced data
2C. An advertiser/agency works with a DSP, who then purchases inventory through an SSP or aggregator,
providing an additional outlet to inventory that the DSP may not have access to otherwise
2D.An advertiser/agency works directly with an SSP or aggregator to procure inventory and reach their
desired audience
3. Addressable TV Buying/Selling Approach
Addressable TV at the household level relies on multiple layers of data, including an advertiser’s own data
(first-party), and most importantly, registration and set-top-box data. These types of data enable much more
precise targeting, allowing advertisers to reach consumers at 1:1 household level. Addressable inventory
provides an opportunity to eliminate waste from the advertising buy, and reach a very niche market that
would otherwise be impossible to reach via traditional TV.
There are several scenarios for an addressable TV workflow:
3A.An advertiser or agency works with a DSP who has partnerships in place directly with various MVPDs to
provide access to the addressable inventory
3B. An advertiser or agency works through an MVPDs propriatey programmatic platform to access
addressable inventory in a more automated way
3C. An advertiser or agency works directly with a distributor in order to purchase ad time from their
inventory
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ADVANCED LINEAR TV ECOSYSTEM
A BYTE-SIZED OVERVIEW
PERSPECTIVES: SIMPLIFYING A COMPLEX ECOSYSTEM
“Today’s TV ecosystem involves more players and more factors than ever before. But does navigating
it need to be more difficult or time consuming for the advertiser, agency, or media company?
Today, players on both the demand and supply sides of the industry are relying on ad technology
to bring workflow automation and simplicity to this increasingly complex ecosystem. With the help
of technology, campaigns can be planned, managed, optimized and measured through a single
platform. In the end, these technologies bring simplified management and detailed reporting,
providing greater efficiency than the days of traditional TV, which relied on manual processes,
handshakes, and spreadsheets.”
TIM CASTREE
NA Managing Director, Videology
WHICH SCENARIO IS RIGHT FOR YOU?
Navigating the advanced TV ecosystem and the changing media landscape can be challenging, so it’s important to understand which
scenario is right for you. In order to evaluate the various options, consider the following:
1. Media Objective: What objective are you setting out to achieve – Brand Awareness? Sales Lift? Reach? Incremental reach? A high
concentration of a strategic target? Or, are you looking to eliminate waste and only target the desired audience? Having a clear
media objective will help to select which inventory is best suited to your needs, whether it is traditional linear TV bought against
age and gender, or data-enabled linear TV or linear addressable.
2. Inventory: The type of inventory desired may dictate the scenario that will yield the best results. For example, private deals may
require plugging into a private marketplace via an SSP, while procuring addressable inventory may require accessing an MVPD
directly through an MVPD proprietary platform.
3. Workflow: How do you want to access and manage your TV inventory? Direct access between the advertiser and agencies may
mean multiple sequential deals to manage, depending on how many different broadcasters or MVPDs are necessary as part of
the media plan. Leveraging a DSP has the benefit of bringing all the inventory together under a single platform to improve on
efficiencies of the transactions, and allows the advertiser or agency to manage different media buys against different inventory
types in a single place.
The two clear advantages of advanced TV are the ability to apply newly available data on television inventory, and the ability to leverage
automation opportunities to improve workflow and efficiencies across media buys. As programmatic TV continues to advance, expect
more developments on the advantages in the market, such as optimal media mix allocation, optimization of inventory, and possibly
even media guarantees against a strategic target.
ABOUT VIDEOLOGY KNOWLEDGE LAB
Videology Knowledge Lab is an educational series meant to shed light on the key topics impacting advertisers and agencies in today’s video
advertising world. These byte-sized pieces will provide definitions, data and straightforward explanations of complicated subjects, to bring
simplicity and clarity to an otherwise complicated industry.
If you have questions or comments, please email [email protected].
FOR A DOWNLOADABLE VERSION OF THIS INFORMATION,
PLEASE VISIT WWW.VIDEOLOGYGROUP.COM/LABS
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