How do TV marketers use data to target individual households for their ads?

Published June 1, 2015   |   

User-specific advertising has become commonplace in online display marketing. You know the drill: you visit a website and see an ad for an item you were recently researching online but didn’t end up buying. This tactic—retargeting—is typically used by display ad marketers looking to recapture lost potential sales and drive conversions.
Now, imagine sitting on your couch and a commercial for an item you’ve been considering buying comes on the TV, perhaps with the ability for you to purchase it through your remote. This is where addressable marketing is heading: everywhere. From online to mobile to television, any advertising that has the potential to be programmatic most likely will be in the near future.
Addressable TV allows marketers to show specific commercials to specific viewers, who are selectively segmented based on first- or third-party information such as income, family composition, or even car leases or mobile contracts. Subscriber profiles from cable providers are fused with other customer data profiles to create audiences for the use of advertisers.
This is going to be big business, and soon. About 42 million households can currently be targeted by addressable TV advertisements, and more will be introduced over the next several years. Some digital marketers are expecting addressable to grow into a multi-billion dollar industry within 2-3 years.
The early data shows advertising on addressable TV to be highly effective. Households receiving addressable advertising tuned away from the TV 38% less often than those receiving non-addressable advertising. Programmatic advertising currently accounts for less than 1% of overall ad spending, a figure likely to change soon.
If your brand is a good fit for addressable TV, companies like Cablevision can help you research and segment appropriate audiences, as well as purchase the appropriate ad space for the connected TVs. For example, Allstate worked with DirecTV and Dish Network to run an addressable campaign for renters insurance, which previously had too small of an audience to justify a commercial on national television.
So is addressable TV is right for your company or brand? Here are four factors to consider:

  • Mass marketing still makes sense for mass products. Is your product niche enough to justify an addressable approach, or is regular TV advertising the best strategy?
  • Advertising rates tend to be high, since the ads can target very specific households. Is it worth it?
  • The magic is in the data. Does the cable operator have the right intel to help you target the audience you’re trying to reach? Do you have your data in a central data hub so that you know you’re sending the right message to the right person?
  • The technology available varies between different cable operators. Once you determine potential reach, do you have the resources required to customize your approach for different providers?

Still game to try addressable TV? Here’s what to do to leverage it:

  1. Gather all your data in one place. Pull together data from online and offline sources so that you know as much as you can before you start advertising.
  1. Think about who you’re trying to reach. This is critical: know who your audience is, and what your message to them should be.
  1. Budget for different versions: specific audiences means specialized content. Experiment and iterate until you find what works in this brave new world.

Taking advantage of the possibilities delivered by addressable TV requires that marketers have a strong grasp of their first-party data. Signal’s Unified Customer View is a powerful cross-channel customer identity solution that can merge data from every channel to create unique customer profiles. This gives marketers the tools to deliver the right message to the right customer on addressable TV—and whatever channels come next.
Check out the infographic below to learn more about addressable TV, how it works, and how marketers can take advantage of this brand-new technology.