Relevant and appealing or intrusive and unnerving?

We already know the power of loyalty cards in allowing retailers to target offers to our individual product preferences. The same is happening in TV.

We now have the flexibility to watch whatever we want when we want across several formats; we aren’t tied into the same schedule as everyone else. National Grid doesn’t have to cope with the spikes in power usage seen previously in nationally-significant televised events. No longer are millions of kettles put on or fridge doors opened simultaneously during ad breaks. A cliff-hanger episode of EastEnders in 2001 finished with a 2290MW power spike; today spikes rarely top 200MW as our viewing habits become more and more disparate.

Aligned to this substantial viewing variety, so-called addressable TV advertising allows ads to be carefully targeted; advertisers paying for audience segments and impressions rather than content. In effect, it’s direct mail in a TV format. It’s not new in Britain but is gaining momentum and the UK is believed to be at the forefront of the sector’s development. Addressable TV allows neighbours to watch the same ad at different times or to see different ads even if they’re watching the same programme. It offers ads appropriate to a consumer’s individual circumstances, aiming to be more appealing and engaging. And it seems they are. Sky has seen a marked reduction in channel-switching during ad breaks when ads are relevant.

For advertisers, the benefit of this targeted approach is the ability to create a personalised strategy giving greater flexibility with creative, deeper insight and less wastage. It’s particularly attractive to smaller, regional or more specialist companies with less budget available than mainstream TV advertising demands. Although cost per impression is undoubtedly higher, many advertisers believe it’s a price worth paying to gain precision and save on wastage. But it’s not for everyone. Bigger brands often prefer to keep talking to as wide an audience as possible. As a result, the breadth of TV advertisers is increasing; two thirds of Sky’s advertisers are either new to TV or new to Sky.

A valid concern for advertisers, though, is around measurement and attribution; critical to get right but harder to achieve with audiences watching TV in a myriad of ways. There is also little consistency between platforms; each broadcaster using their own approach.

According to the US Video Advertising Bureau, addressable TV is bigger than LinkedIn, Instagram and Wikipedia. Sky is the market leader in the UK with AdSmart. Having struck a deal with Channel 5 earlier in the year, the company has just announced an agreement with Virgin Media, expanding the reach of its platform considerably. Channel 4 is also active in this area, with ITV due to launch in the next couple of months; their aim to attract online advertisers. Those broadcasters without a set-top box have to use a different mechanism to target audiences based on census-type data.

We’re keen to try addressable TV with a new client offering a premium product.  Having used direct mail previously, due to its targeted nature, addressable TV is the obvious choice as a new and suitable alternative to attract high-end customers.

To find out more about how addressable TV could work for you, contact Lesley Bowman on 01225 758222 or lesley@br-tv.co.uk