While the TV world waits on a new metric beyond traditional ratings, cable operators and their partners are mining set-top box data for richer pictures of consumers’ TV desires.
A number of logistic, cost and privacy issues will stand in the way of collecting the clicks from millions of cable, satellite and telco TV households, and turning them into a credible source for setting ad rates. “I used to say all the time that set-top box data will be the raw material for measuring TV viewing in my lifetime,” said Bob Ivins, Comcast Spotlight’s vice president of data products and research. “I’ve dropped the ‘in my lifetime’ part.”
But the industry is finding a growing number of uses for set-top data, most notably as a supplemental ad-sales tool to demonstrate a spot’s effectiveness. The viewing metrics can let marketers more efficiently reach their desired audiences and tap into the value of “long tail” cable networks that are not rated by Nielsen.
In addition, cable’s advanced advertising efforts — including Canoe Ventures’ soon-to-launch interactive spots — will rely on aggregated set-top box data.
Canoe’s interactive ad units, which will allow viewers to request more information or product samples, are set to debut June 20 and will provide programmers and advertisers with data about how many people clicked on an RFI offering. The company, which is owned by the six biggest U.S. MSOs, eventually plans to use that data to provide insights such as which programs have the highest interaction rates and how much frequency was required to get people to respond, said Gerard Broussard, Canoe’s vice president media insights and analytics.
“What we’ll be doing with select advertisers is not only demonstrating the effectiveness of the platform, but we’ll have the first interactive reporting system that traverses the cable industry,” Broussard said.
Time Warner Cable, meanwhile, is arming local sales reps with set-top data the MSO collects internally. “It’s the real deal. We can show advertisers exactly where they should be spending their money,” said James Manchester, regional president of network operations and engineering for TWC’s New York City system.
Similarly, Dish Network, AT&T U-verse TV and Charter Communications’ Los Angeles division are using their set-top data “to tell a different story to their advertisers,” said Cathy Hetzel, president of Rentrak’s Advanced Media Information Division, especially with respect to networks not rated by Nielsen.
And the opportunity to exploit set-top data for new kinds of TV audience research is attracting new players — and strategic investments.
For example, Time Warner Inc. took a stake in TV-marketing startup Simulmedia, which aims to improve the effectiveness of tune-in spots using info from 15 million set-tops. Intel recently invested $10 million in TRA, a New York startup that cross-references TV viewing data with frequent-shopper information.
FourthWall Media, a developer of interactive TV software, recently hired Bill Feininger, previously Nielsen’s vice president of technical strategy and development, who will head up its newly created advanced-advertising research group. “The niche we’re trying to carve out is analytics, information and pure data for advanced advertising,” Feininger said.
To be sure, challenges remain. For starters, there are no industry standards for set-top data, and different boxes have varying abilities about the level of detail they’re able to capture. But “if we waited until all the standards were in place, we’d never get started,” Hetzel noted.
From an operations perspective, the challenge is to coordinate set-top data collection from multiple markets, said Craig Schwabl, Concurrent’s chief architect for media data and advertising solutions.
Comcast Spotlight’s Ivins acknowledged that it is still relatively expensive to retrieve and store set-top data. “We’re trying to be careful about how we do this — we have our toe in the water,” he said.
But he has another concern: that tying ad rates to real TV viewing data could potentially upset the existing ad market, as it’s just coming back from one of the worst years on record, Ivins said. “If you’re going to get more accurate measurement on the long tail, you’re going to have winners and losers,” he said.
Ultimately, media buyers will need to blend traditional ratings information with set-top metrics to optimize their TV spending, said Craig Woerz, managing partner of Media Storm, an advertising and marketing company based in Norwalk, Conn. But that’s a more complicated way to sell ad inventory .“It’s like a whole new negotiation,” Woerz said.
Examples of how set-top metrics are being used today:
Time Warner Cable, Charter L.A., Dish and others are providing internal set-top data as a sales tool for local ad reps
Simulmedia analyzes anonymous data from 15 million set-tops to improve the effectiveness of tune-in programming spots
TRA's 370,000-household database cross-references set-top data from TiVo and others with purchasing data from retailers' frequent- shopper cards
Canoe Ventures will track viewer response to request for information spots, set to debut in June
SOURCE: Multichannel News research
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