Media

By the end of the decade, ad buying for TV & digital will finally converge

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Image Credit: Old TV commercial image via Shutterstock

Has your mobile device or computer become a second TV? Most likely yes, and audience measurement firm Nielsen is out with a new report today asking when advertising will adjust to an equality between large and small screens.

They’re not yet equal in key measurements, but the trend is clear. Each month, 283 million Americans watch TV, but a non-trivial 150 million consumers watch video on the Internet — a 10 percent increase over three years ago.

Wouldn’t a single buying mechanism for TV and online ads make more sense? It might, but Nielsen’s report, Video Convergence: Buying, Selling and Trusting Across Platforms, estimates that that two separate buying structures are not going to merge until the end of this decade.

Two factors are driving this convergence: advertisers want multiscreen campaigns, and, influenced by the metrics available in digital, they want measurements of resonance and reaction in TV advertising, not just reach.

In other words, the impact of ads is becoming more important than how many people see them.

But several factors are holding the convergence back:

• The ad spend is still heavily tilted toward TV, with $78 billion spent on TV ads last year, compared to a projected $5.72 billion this year for online video. Obviously, TV gets most of the attention.

• TV ads remain the most influential form of advertising yet invented, but tracking information on TV viewers — a subject that Nielsen knows well — is described as “expensive and challenging.” Online metrics can be very inexpensive and detailed, so TV and online video are currently mismatched.

• Large ad agencies are still buying TV ads in TV-oriented silos — national or local TV, broadcast, cable, syndication — while online video ads are being bought by the digital agencies or digital divisions that purchase search ads or display ads.

• One surprise is the human factor. The report found that TV media buyers know each other, creating trust that doesn’t exist in automated online ad buying:

“As one marketer remarked, ‘Silicon Valley doesn’t understand TV. They only understand digital. And, until they begin to understand both, there will be a disconnect.’ TV buyers and sellers will need to reach a level of trust in automation for adoption to occur.”

In the short term, the report suggests that online video ads will continue as a growing subset of online advertising — and TV-oriented ad agencies will increasingly package digital ads as part of multi-screen buys.

By 2016, expect to see some integration of ad buying, as the digital infrastructure underlying modern TV delivery increasing resembles online’s. Coming soon: direct measurement in near real-time of all video ads, including TV, coupled with the ability to cross-ref viewing data against online activity and recent purchases.

By 2020, Nielsen predicts full integration:

“For this convergence to take place, the advertising industry will need to embrace video as a platform agnostic medium.”

Then video, not the delivery channels, becomes the medium.

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