Entering the Digital Age of Advertising
The advertising industry is undergoing a turbulent period, pre-dated yet certainly catalyzed by the ongoing pandemic. The digital evolution towards streaming platforms has forced many advertisers to re-think their approaches and look to new technology advancements. Addressable advertising strategies driven by data and actionable insights are becoming critical tools for broadcasters and network operators looking to monetize their content in the most effective way.
Addressable advertising can increase revenue streams significantly for broadcasters and network operators. It’s no surprise then that linear addressable TV advertising spend is expected to double between 2020 and 2023 (Statista). In the age of streaming, the relationship between programmers and consumers is quickly evolving, and it’s now possible to open up exciting two-way conversations based on first-party data. The correct advertising strategy can help achieve this.
Taking advertising into the internet age
The consumer migration to streaming platforms offers ample opportunity for broadcasters and operators to capitalize on new technology developments and connect with and engage their audiences more directly and efficiently than ever before. The outdated one-to-many approach to broadcast advertising is quickly being replaced by one-to-one content strategies, whereby content recommendations are made based on viewing habits. Addressable advertising is fundamental to achieving this.
The recipe for a successful addressable advertising strategy is quality ad inventory and audience insights knowledge. These are two key ingredients programmers have at their disposal. From live viewership numbers to detailed insights into multi-device usage and video-
on-demand content consumption, broadcasters and operators can build a holistic picture of what makes their audiences tick. More importantly, they can understand how to better engage with them within their comfort zone.
Ensuring privacy adherence
As TV services increasingly converge their live or on-demand programming with social media and mobile applications, there is a need to balance data collection, privacy, and creating actionable insights. Recent developments in big data and machine learning make it possible to automate the collection of granular user information and divide the audience to better inform ad insertion decisions.
End-user data provides enormous value for marketing and advertising functions by enabling more advanced targeting and boosting the value of an advertising campaign. Conversely, audience data is also the operator’s potential Achilles heel. Operators need security and protection against potential leaks to the demand-side, ensuring full monetization while simultaneously requiring compliance with local and global privacy protection regulations. This includes the EU General Data Protection Regulation (GDPR) law, which came into effect in 2018.
The rise of internet-based streaming has spotlighted two primary ad insertion strategies: Client-Side Ad Insertion (CSAI) and Server-Side Ad Insertion (SSAI). While both approaches are possible for traditional set-top box delivery, streaming has expanded the possibilities for both methods.
In CSAI, the client application and video player enable the process for making ad decision requests and taking resulting actions. Ads are stored locally by the client, allowing them to switch between primary content and ads. With this method, the capabilities of the client application and video player determine how switching between primary content and video ads is handled. As the digital side of the ad industry has traditionally focused on client-side ad requests, there is a lot of existing experience and knowledge in the area. It also supports interactivity for consumers, lending itself to gamification in content and additional overlays.
In SSAI, communications for ad decisions and the act of ‘ad stitching’ are performed by components upstream of client applications. Ads have already been inserted by the time the customer receives and processes the stream, so the client plays the stitched stream just as if it did not have ads placed. This makes for a seamless viewer experience between content and ads, and makes it much harder for ads to be blocked.
Both approaches offer significant advantages. In an ideal world, broadcasters would deploy both SSAI and CSAI if budget suffices. CSAI makes perfect sense for some types of monetization specific to each consumer, including interactivity and live statistics overlays. For operators, however, this means losing control of valuable audience data.
Therefore, from an operational perspective, SSAI is best positioned to maximize ad stitching success and ad impressions through techniques such as ad decisioning, pre-fetching, and creative management. It maximizes the ad inventory potential by enabling programmatic selling of unsold inventory.
Opportunities for success
When deciding upon an approach to ad insertion, broadcasters and operators must ultimately consider the type of content being produced. Live sports, events, and news streams are starkly different from other content types, given their timing and potential for large spikes in audience numbers. SSAI is the best choice for this type of content because services related to SSAI can dynamically scale to accommodate peaks.
Opportunities remain for more traditional ad insertion to take place alongside new forms, including live overlays, sponsorships of sports stats, and highlights. Traditional ad insertion into video streams can easily be done using SSAI, ensuring a seamless experience for gamers.
Irrespective of the approach taken, the decision should always boil down to delivering the best consumer experience. CSAI and SSAI both have advantages and challenges, yet deploying them together based on content type and infrastructure maximizes the monetization potential while ensuring consumers receive the best possible experience.