TV networks partner to standardize addressable advertising
Yet another consortium is forming among TV companies—this time to establish standards in addressable advertising.
Dubbed "Project OAR," which stands for Open Addressable Ready, the goal is to develop and deploy a new, open standard for delivering ads to individual households on smart TVs, which is known as addressable advertising.
At launch, the consortium includes NBC Universal, CBS, Disney Media Networks, Discovery, AMC Networks, Turner, AT&T's Xandr, Comcast's FreeWheel and Hearst TV, along with Inscape, a division of Vizio, which will develop the technology.
This is the latest effort by TV networks to work together to improve measurement and targeting to fend off digital ad behemoths like Google and Facebook.
Addressable advertising has long been ballyhooed as the holy grail of TV advertising. But after more than a decade of talking about the benefits of targeting individual households, the process of delivering such ads remains cumbersome and time-consuming.
Much of the issues stem from disparate technologies, data sets and measurement approaches, says Jesse Redniss, exec VP of data strategy at WarnerMedia and general manager of the innovation lab. The goal of Project OAR is to streamline the process so advertisers and their agencies do not have to replicate the process in slightly different ways depending on who they are working with.
Connected TVs and internet-delivered content are expected to help scale these capabilities, says Steve Silvestri, VP, advanced advertising, Discovery.
Addressable advertising is currently available in about 70 million households and is about a $2 billion marketplace, according to eMarketer. Some industry experts question that estimate, though it pales in comparison to the $70 billion TV ad business regardless.
Vizio is promising that once the standard is developed, it will allow programmers to deploy it through its footprint of 10 million connected TVs. And it is designed to be open, so any internet-connected TV maker can use it, says Jodie McAfee, senior VP, Inscape. McAfee says they are currently in discussions with other TV makers. In this way, it hopes to help scale addressable advertising.
"The only way this really works is if there is a direct relationship between the publishers and OEMs [original equipment manufacturers]," he says.
Inscape is designing the solution to be flexible to work with whichever ad tech publishers choose, like FreeWheel or Google.
"You can't just tell people we are going to provide your entire stack and everyone must use this entire stack," McAfee says.
The network groups have made financial commitments to be part of the consortium, which will operate independently and is not a for-profit organization, McAfee says.
The consortium, which first met last month and is meeting again today, plans to have a prototype to demonstrate later this year, with full deployment expected for early 2020.
Project OAR comes two years after Turner, Viacom and Fox first introduced its plans for OpenAP, a group designed to help standardize audience buying on TV. OpenAP first deployed its product in the fall of 2017, and since then programmers like NBCU and Univision have joined the fray. While agencies are utilizing the product, there have been mixed views over the how much business OpenAP has actually driven, and there are plenty of questions over the future of the group following AT&T's acquisition of WarnerMedia (fomerly TimeWarner), which includes Turner.
There are also efforts among TV networks to standardize attribution—the ability to prove that commercials drive actual business results like test-driving a car or visiting a website. NBCU, A&E Networks, AMC Networks and Discovery, among others, are utilizing methodology developed by analytics firm Data Plus Math for these efforts, but those tests are still in the early stages.
Separately, NBCU and Fox have each hosted gatherings of top TV, agency and marketing leaders to discuss ways the industry can solve for some of its biggest problems, like measurement and ad clutter. EY and MediaLink have also hosted similar pow-wows, but tangible actions have been limited.