Multi-platform ad campaigns still face big obstacles

Michelle Clancy | 07-03-2014

The video landscape is in a time of major flux, with digital viewing on the rise, and yet TV networks still hold most of the cards, the latest report from Nielsen says.

Video advertising is poised for change and convergence too as advertisers seeking integrated campaigns, but significant differences in TV and digital advertising benefits remain — and stand in the way of true multiscreen campaign uptake

Consumers spend nearly 159 hours watching video each month, including nearly 147 hours on TV, according to research from Nielsen and Simulmedia. Advertising dollars follow suit, naturally: Nielsen research found that roughly $78 billion was spent on TV advertising in 2013, and eMarketer estimates that online video will attract $5.72 billion in 2014.

"Some in the marketplace believe this means an imminent and total convergence of TV and online advertising, but our discussions underscored that this ignores the way video ads are actually bought and sold today," said Amit Seth, executive vice president of global media products at Nielsen, and Dave Morgan, founder and CEO at Simulmedia, in a blog on the research.

They explained that the agency model is built on two separate buying structures: one for TV and one for digital. And even though advertisers are indeed seeking multiscreen campaigns, the two ad markets will remain separate for a while yet to come.

"The scale and size of the TV ad machine allows the ads to influence the lives of consumers on a scale that no medium has ever matched, yet collecting information about TV viewers — and connecting viewership to buying habits — has been expensive and challenging," the two said. "In comparison, online video content is inherently more measurable. Online video and second-screen devices like smartphones and tablets generate massive amounts of valuable delivery and interaction data, as do, to a lesser extent, set-top boxes and smart TVs."

Now, TV as an ad platform has started to absorb many of the characteristics of the digital ad world, particularly its abundance of rich viewing data and audience metrics. Enhanced measurement techniques are also making precision marketing and the connection of ad exposure to offline sales a reality.

Digital, however, isn't soaking up TV's perceived reliability. In 2013, 62% of consumers in the research indicated that they trust ads on television and 68% take action based on TV ads. Meanwhile, the programmatic tendency of the digital ad market lends itself to cost effectiveness and ease in measurability, yet removes the "human touch" from the buying process.

"There's a serious problem with trust online with programmatic about automation in online advertising," said Paul Marcum, head of global digital innovation at Bloomberg Media Group.

Put simply, building and managing trust between buyers, sellers and third parties will play a significant role in determining the way television and online video advertising eventually come together.

The future of advertising is also hinged largely on precision-based planning tools that help marketers reach the right consumers, not simply the most people. So, the report found that impact-based rather than reach-based advertising mechanisms will be a principle factor leading the convergence of TV and online.

"Our marketer participants stressed that tomorrow, just as today, they are pressed to prove their ROI on each dollar they spend on advertising," the researchers said. "Tools that allow them to reach the right customers — and then demonstrate purchases made or actions taken — some of which already exist, will win the day."