Executives from the top US TV networks recently met to determine if the time has finally come for the TV advertising industry to move away from the analog-era Nielsen panels and audience-based currencies towards a more modern, multi-screen measurement standard that tracks sales as they correlate to TV ad impressions.
The Video Advertising Bureau has floated the idea of using an attribution-based measurement standard for linear TV advertising, giving linear TV networks some of the measurement prowess that’s luring brands and marketers over to digital. According to reports, over 40 executives from TV networks ABC, A&E, AMC, CBS, CW, ESPN, FOX, Discovery, Hallmark, NBCU, Turner and Viacom and others are mulling the VAB’s proposed attribution standard, currently referred to as Thor.
An attribution standard would give marketers insight into how a particular advertisement, in a particular time slot, for example, might influence a consumer’s purchase decision. This type of measurement may help brands and marketers better plan their TV campaigns by alerting them to what works and what doesn’t – in a way that’s more accurate and precise than traditional TV measurements can. Nielsen and comScore already offer attribution solutions as supplements to their respective overall measurement offerings.
Modern marketers are, of course, well familiar with the benefits of leveraging this type of data in advertising campaigns online. But for linear TV networks, the adoption of such a model would be a stark evolution of a space that has largely remained obstinate in embracing newer models of advertising. None of the networks have agreed to use the standard yet. Thor will have to demonstrate to the TV networks that an attribution-based measurement would preserve the perceived value of the linear TV ad impression; and that incorporating attribution metrics won’t hurt TV networks’ advertising revenues. If there’s any chance that the TV networks will lose revenue, they aren’t likely to adopt it.
VAB hasn’t released much information about Thor, but the big question is how TV networks plan to track purchasing behavior and link that back to linear TV ad impressions. Data and analytics firm Data + Math is handling some of the technical bits and pieces of the project. The company is building a data platform that can map the effects of video advertisements on product sales. For Thor, data will likely be captured on mobile and streaming devices, and set-top boxes; and as more TV sets are connected to the Internet, there’s less guesswork involved.
But many different factors are at play when a consumer makes a purchase, and many TV advertisements are “top of funnel” marketing messages, not direct response messages, which can make tracking attribution a challenge. A branding commercial about Dawn dish soap being used to clean oil off baby ducklings may not spur consumers to rush out to the store to purchase Dawn immediately, for example, but may impact consumers’ purchase decisions next time they are looking for dish soap – which may be months later. If the Thor attribution model fails to capture the effectiveness of TV advertising, the networks may stand to lose even more advertising dollars.
US TV networks are already in a bit of a rough spot. Live linear TV audiences are not just shrinking, they’re also aging, as more age groups move towards on-demand, time shifted and multi-screen streaming. Linear television programming – from dramas to sports – continues to suffer ratings declines across the board, which has forced TV networks to create a new definition of a “hit”: according to The Diffusion Group, prime time TV shows in 2017 are drawing audiences that are 30% smaller than those prime time shows drew in 2012.
The TV industry has already made a series of adjustments to help accommodate the new norms of TV viewing, from making more content available online across TV network digital properties, to adjusting ad buys to include time-shifted viewing in the C3 and C7 windows, to now offering advanced advertising options that promise to use data much like digital adtech platforms do. Earlier this year, for example, Fox Networks Group, Turner and Viacom launched Open AP consortium, aiming at introducing more advanced standardized audience targets that are more precise than Nielsen’s age and gender demos.
But even with these efforts, it’s clear that linear TV’s luster for advertisers has begun to dull. The most recent wave of advertising dollars that’s moved back into TV is actually a case in point: marketers shifted dollars back to TV not because TV has suddenly improved, from their perspective, but because YouTube had temporarily worsened. TV networks will need to prove to brands that the TV advertising medium can offer them something that digital cannot if they want to keep those brands and their budgets focused on TV.
While upfront revenue increased in 2017, so too has the cost of content; and the TV networks that had made big bets on sports rights are now facing the horrifying reality that even sports ratings are dropping. VAB’s pivot towards attribution is an attempt to prove out the worth of linear television advertising in a world where, by all conventional metrics, linear TV’s worth to audiences is rapidly eroding.
VAB’s president and CEO, Sean Cunningham, is confident that including attribution into existing measurement models will help to prove TV’s sustained effect on sales outcomes as an ad platform – even with the audience erosion – and will give advertisers the confidence needed to increase buys. “The next step in our attribution quest is accelerating both terrific forensic data and predictive data capabilities, pressing for the solution with the features that advertisers most need,” Cunningham said. TV networks are now exploring the attribution model and may even begin acting on it by 2018, according to VAB.
Thor might also point to a new interest in asking some tough questions about how advertising is evolving alongside content consumption. To be clear, TV advertising is still considered the best platform for reaching massive audiences, all at once. But as consumers are growing more accustomed to having everything from their music stations, content recommendations and social media feeds completely personalized, will they too begin to expect their advertising to be completely personalized, even on the TV set? The answer is probably yes. TV networks will need to solve that problem too, and solve it soon.