Driving Value with Addressable Advertising in the Age of Privacy

By Cadent InSites Archives
Cover image for  article: Driving Value with Addressable Advertising in the Age of Privacy

With issues of privacy increasingly at the forefront of advertising today, fundamental truths about the industry must be acknowledged.

Targeting, as commonly understood over the last two decades, is rapidly disappearing, thanks to big changes being made to device identifiers in the mobile space (like IDFA) and the elimination of third-party cookies in major browsers. (Google has announced that it will phase out the third-party cookie on Chrome browsers, which account for well over half of all global traffic, by 2022.)

In recent months, we have heard a number of concerning news stories about ad fraud, and this time it's the high value CPMs of Connected TV that are being targeted by the fraudsters. The consequence of this is creating a bigger issue with trust. One thing we can be sure of, is that more regulation is coming, whether it be in the form of government anticompetitive measures or the self-regulation required to prevent damage to the viewer experience.

With the right technical partner and guidance, however, operators and broadcasters can avoid some of those pitfalls. That becomes even more important with addressability gaining pace around the world, including in major markets like France, Germany, and the U.K. Addressable budgets are also increasing exponentially: by 2025, almost a third of TV ad revenues will be generated by addressable thanks to three key things:

  • Firstly, industry collaboration creating larger addressable audience targets.
  • Secondly, significant growth in the connected TV market as younger audiences shift away from the linear experience into a more on-demand experience.
  • Finally, the main factor: addressable advertising simply works, and more relevant advertising makes for a much better viewing experience. A win-win.

At the very core of this addressable revolution is identity, which allows not only for the creation of a unified view of the audience but for things like measuring incremental reach and real business outcomes; and for building audiences by combining first- and third-party data.

TV platform operators have an important role to play in this ecosystem: as a survey by Ovum determined, brands consider telcos among the best original sources for data, second only to social networks. (Social networks received 77 percent of the vote, but telcos received a very respectable 67 percent, well ahead of chat app platforms and device manufacturers.) Why is this? Advertisers know that the data is first party, verified, auditable, and, above all, actionable. Scale also figures into the equation. By 2022, there will be more than 200 million pay TV homes in Europe, expanding the ability of operators to gather that valuable data.

There are of course challenges: the operators active in the space over the coming years may be relatively new to it, and it may constitute only a small portion of their business. They will be rightfully concerned with how their data can be activated in a privacy compliant manner and how it can be scaled to benefit a broad range of advertisers with different branding objectives. Can the quality of the viewer experience be preserved -- or even improved?

Answering those questions becomes much easier with technology solutions such as Cadent Viewer Graph, which allows operators to activate their data and take advantage of new revenue opportunities, in a way that respects privacy and in a managed environment not susceptible to ad-fraud -- all while enhancing the viewer experience.

Using that kind of technology isn't a decision. It's an imperative.

For more, watch a presentation from Cadent Vice President and Managing Director, EMEA, John Tigg, at the 2020 Future of TV Ads Global virtual conference.

Top photo courtesy of Cadent.

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