Advertising Week New York 2022: How to Create a Unified TV Experience in a Fragmented Ecosystem

Today’s expanding TV ecosystem is still quite fragmented from a business and consumer perspective. This affects media planning, ad quality, and the audience experience. Nielsen’s State of Play report found that 64 percent of streaming viewers desired an aggregated bundle to make selecting content easier, indicating a demand for greater simplicity in TV viewing.

On the first day of Advertising Week New York 2022, Magnite’s Chief Revenue Officer Sean Buckley sat down with Disney Advertising’s SVP of Addressable Sales Jamie Power and Fox Corporation’s SVP of Data Strategy and Sales Innovation Dan Callahan to discuss creating a more unified viewing experience in TV. Here are some inside views on measurement, addressability, and how the industry can move towards a more streamlined path.

Buckley: From a programmer’s perspective, how do you improve content discovery for consumers? 

Callahan: Content discovery is critical to the streaming experience. As an industry, we’ve probably done ourselves some disservice by trying to push content out as broadly and as rapidly as we have to the masses. I often forget what content I’m watching and what platform or service it’s on. We’ve got to figure out a way to make content discovery more seamless and connected to the platform. At Fox, we’re trying to do that by bringing our content to the forefront and being on the platforms where users are consuming.

Power: Because TV is so fragmented, finding content can be harder and harder, but it’s all about relevance through data. That means using data to reach an audience and learning what type of ads a consumer will gravitate toward most in a streaming environment. At Disney, we’ve pioneered new ads like Pause Ads and Binge Ads on Hulu to be more thoughtful in how we engage viewers. It’s about using the data to understand what’s working for the consumer and what’s not because the data doesn’t lie.

Buckley: Live events, live sports, in particular, are a major part of both of your portfolios. How do you look at monetizing live events? 

Power: Programmatic for sports is a huge opportunity because 60 percent of sports viewing occurs during the weekend. So, the programmatic market can help make it easier for buyers to reach the right audience at the right time. Whether it’s live streaming or not, it doesn’t matter. What’s paramount is knowing your audience and using technology to aggregate that audience at scale.

Callahan: Live linear is top of mind for us. Our portfolio shows that the majority is live news and sports. For those bigger broadcast moments where it’s about reaching a broad audience at scale in its totality, we are stitching through that linear commercial load — we call that “linear pass through.”  I’m excited about Dynamic Ad Insertion (DAI). During the weekend, when there’s that traffic spike, anywhere between 10 percent and 20 percent of inventory is now being monetized programmatically. More people are streaming live sports. We’re exceeding those forecasts, and we can take advantage of that inventory with programmatic. There’s a big opportunity for us to co-mingle direct and programmatic. The ideal is to have DAI where programmatic and direct can appropriately share an ad pod and take advantage of every break within it.

Buckley: You both have converged portfolios across both streaming and linear. In this last upfront cycle, what has the experience been like with the buy side, selling both?

Power: We have to rethink how media plans have been built for the last 25, 30 years. It’s not always starting with cable and then adding streaming. The data says if you start with streaming and then add on cable, it’s a way more efficient way to buy. We all need to do our best to activate the data and make sure we’re not planning with legacy tools.

Callahan: We’ve seen a lot of agencies and selling teams restructure themselves to think about video in totality. There’s been a rethink about systems, tech, and data and measurement. 

The systems of activating and planning are still separate. We’re doing our best to unify the buying experience to make it more frictionless and easier. 

Buckley: The measurement discussion has been top of mind for buyers with the emergence of alternative currencies. How central is that discussion to your business?

Callahan: I do think a change is coming, right? We’ve all been talking about it for the last couple of years. I think the incumbent measurement provider has some solid footing to continue to be the primary. But what we’ve begun to explore for ourselves, as well as for some clients, is a secondary target. And I think as we continue to become more comfortable with measurement alternatives and understand how they perform against what we’ve been doing business with, that comfortability will grow. But that change hasn’t been fully switched on yet. 

Power: At Disney, we’re trying to let the advertiser tell us how they want to measure audiences. So we’re enabling measurement and making it more open from a currency standpoint. To me, it’s all about the currency. I care more about driving outcomes for our clients. We’re taking the data, reading the KPIs, helping recommend audience segments, and then showing that the measurement signals actually worked at the end of the campaign. 

Buckley: How are buyers talking about traditional transaction models versus programmatic? 

Callahan: So I think it’s still split, right? You still have a lot of traditional buying in the sense that the brand knows it wants to be adjacent to certain content. So, they buy through the traditional models of an IO and tags. That’s still a large part of our business. 

But we are growing our programmatic capabilities. Our focus is on co-mingling the right mix of programmatic demand with direct demand. Having direct demand to help set that baseline and drive a strong upfront, and then building your programmatic marketplace on top of that has been our approach for the last couple of years. 

Power: I don’t think the programmatic and direct businesses necessarily compete. They’re both just ways to transact. A lot of our advertisers transact money upfront and then we let them choose — Do you want to do this programmatically or do you want to do this direct? For us, it’s about making it easier to transact at scale. And when you’re doing audience-based buying, programmatic technology does make it easier for brands to scale audiences. So we’re seeing an uptick in programmatic executions.

Buckley: The definition of addressable TV is nuanced and multi-dimensional. How do you define addressable TV? 

Power: I would say addressable is identifying an audience using first, second, or third-party data. The audience could be a demographic and sending a message to the IP, the household, or the device ID. I think the early definition of addressable meant strictly sending audience segments to the set-top box at the household level. But now, when we live in this world of crazy fragmentation, you really need automation and programmatic technology to aggregate the audiences at scale. I would say programmatic is the future of addressable.

Callahan: I don’t think everything is addressable today, right? There are still dark spots where we’re not getting those right signals. I agree about the first, second, and third-party data application. For us, our addressable business is still primarily direct, meaning IO tag-based. We are making forecasts and reservations on segments to hit the right device. Overall, addressable can include a wide array of custom segments and targets, and then you have programmatic, which has a data-driven element.

Buckley: In 5 years, is everything in the television ecosystem going to be addressable? What do you think that looks like?

Callahan: In the future, the opportunity to make everything addressable will be there. I don’t think in five years, we will be at a footprint that is a 100 percent addressable. There are players who continually try, in desktop and mobile, to obfuscate targeting signals. So, there are going to be walled gardens that programmers won’t be able to access on an addressable basis. 

There’s a whole tangled web of systems and processes, and we’ve got to get our house in order on the digital side to make the content fully addressable. Will linear and digital become streaming altogether? I think so, in ten-plus years, but probably not five.

Power: The technology is already here to make the entire ecosystem addressable. In theory, everything could be addressable today, and the majority of the market is enabled with addressable technology. But not everyone’s embracing it yet. 

Buckley: What do you think will be the next big surprise in the TV market?

Power: I don’t know if we’ll have a big surprise. I do think the metrics are going to change. We’ll see newer metrics come into the market. We’ll be using identity graphs more and interoperability more. We’ll use them in sync, and you’ll be able to really action off of the data to see the reach and frequency holistically, not in the way walled gardens present it. It will all become more holistic and unified.

Callahan: I agree with that. With this in mind, Fox announced our expanded partnership with Innovid last week. So, what is linear plus streaming? How do we think about that viewing audience and consumption in totality? I do think that some of the technical gaps and glitches are getting worked out. We’re all focused on thinking about video and live content in totality and hopefully breaking down some of these silos of linear and digital. I think it’s going to be exciting, and hopefully, it gets easier.

Power: So you think it’s going to be easier? Do we agree on that?

Callahan: Yes. I agree. It can’t get any harder!