Beer, Diapers And The Programmatic TV Challenge

petedoeOn TV And Video” is a column exploring opportunities and challenges in programmatic TV and video.

Today’s column is written by Pete Doe, chief research officer at clypd.

About 10 years ago while working at Nielsen, we began creating integrated data sets linking consumer and media behavior to help agencies plan better campaigns and media owners better understand and monetize their audiences.

One sunny spring morning in New York we met with a cable network to present some results. We had fused Nielsen currency ratings with consumer panel purchase data, revealing that the network’s highest indexing product categories were beer and diapers. I felt slightly nervous that insight might be an example of “Twyman’s law,” which states that if a research finding looks interesting, it’s probably wrong.”

The network research executives looked at the PowerPoint slide in silence. Finally, one said, “Yes, that’s what our viewer research surveys show as well … and in some cases, it’s the same programs that index high for both. … These are parents who drink a beer at home as it’s harder to get out when you have newborns and toddlers.”

For once, Twyman’s law didn’t apply. But the findings did raise interesting questions about how to sell the network and its programs, and how to create and schedule ads. Are the viewers who are buying beer the same people buying the diapers? Does placing a diaper ad immediately before or after a beer ad make sense? It seems jarring but maybe it works. And could there ever be a creative that equated beer drinking with responsible, caring parenthood?

Fast-forward a decade and today the marketing and media worlds are demanding more precision in their understanding of consumers. That same cable network is using integrated data sets in programmatic scheduling of linear TV deals.

To some, programmatic and linear TV may seem an odd match. Programmatic is often assumed to be a purely digital process, typically for display, usually with real-time bidding impression-level addressability via cookies and IDs enriched with data from various sources and aggregators. Linear TV doesn’t currently have a huge amount of individual addressability and offers minimal, if any, real-time bidding, so what is it?

If you define programmatic as a combination of workflow automation and data-driven decisions, it is broad enough to include addressability and real-time bidding, but doesn’t demand these elements. For this particular cable network, programmatic involves the creation of a private marketplace where inventory is made available to select buyers.

Within this marketplace, schedules are created within agreed parameters of cost, selling titles, demographic delivery and secondary target delivery. For a campaign aimed at beer drinkers, for example, the algorithms in the platform could create a schedule that delivered significantly more beer drinker impressions than a traditional deal, while maintaining the agreed demo impression delivery and staying within budget.

Overall this is good news for buyer and seller. The buyer is getting more value for the same dollar and the seller is strengthening its relationship with the buyer by delivering this increased value. And let’s not forget a third, essential element: the viewer. Delivering ads that are more relevant to the viewer has to be the primary aim. If programmatic can deliver on that basic aim, both advertisers and media owners will benefit. It is still too early to know to what extent programmatic schedules can shift measures of ad engagement, but assessing this is on everyone’s radar, along with measures of ad effectiveness.

In the future, increased addressability capabilities will enable further refinement of these approaches, beyond mass advertising to personalization. That brings us back to diapers. In a world of addressable linear and over-the-top TV, there will still be occasions where two or more people watch TV together. And as we still live in a world where moms are more likely to be the ones buying diapers and dads more likely to buy the beer, how do ad-serving decisions get made?

Should we be promoting beer or diapers in this program, or both? And how effective can addressable ads be if the information determining the ad serving is based on boxes – not people – and household classifications of presence of children are not always accurate and the knowledge of previous purchase behavior is incomplete or nonexistent? And let’s not pretend that digital has answered these questions, for even though that medium tends toward more personal use of devices than TV, the same questions of personal identity and data accuracy arise.

These questions will remain unless more information is available about viewers and consumers, which in turn raises issues of privacy. In short, the promise of a perfect streamlined flow of data about consumers and communication to the right people at the right time is the end we’re seeking, but we will probably always be on the journey rather than at the destination.

But it is the right journey to be on – delivering a better experience for viewers to increase value for advertiser and media owner alike. And let’s make sure we spare some time for a beer on the way.

Follow clypd (@clypd) and AdExchanger (@adexchanger) on Twitter.

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1 Comment

  1. What is it about beer and diapers? Google it. In 1992 Tom Blishok, NCR retail analyst “In the process of Tom creating materials for NCR to make the argument for why you want to house transaction data he needed a snappy example, so he dreamed up the “diapers and beer” example.” From there, urban legends sprang up, Walmart, 7-11, moved diapers next to beer and sales went thru the roof (not true). Now we are being told to have combine creatives, the beer/diaper creative. Maybe we can get the most interesting man in the world to wear a diaper.