More and more TV viewers are making the switch to streaming, which has advertisers flocking to the platform too. As such, our latest TVR[E]V Special Report, TV In The Fast Lane predicts that ad-supported streaming will become a $40 billion market by 2026.
But. as the Wall Street Journal recently highlighted, there is still serious frustration when it comes to frequency capping, or making sure that viewers aren’t bombarded with the same ads over and over again across multiple platforms.
TV[R]EV recently talked with Adam Helfgott, CEO at MadHive, an enterprise software company that builds tools for advertising on OTT, to dive into this problem and how it can be remedied.
What is the underlying problem with frequency capping on streaming TV?
It comes down to the fact that streaming TV is being transacted on average frequency. But it’s very easy to manipulate an average. For example, if a brand’s average frequency is 5, we are often seeing in CTV that a small portion of the “targetable audience” is actually being served the ad hundreds of times, while a larger portion is going unexposed.
What’s the alternative?
Simply put, you can buy on actual frequency. This means dedicating exposure preferences on a household-by-household basis, and then using real-time glass-level verification to monitor CTV campaigns.
Unfortunately, in the digital advertising industry, the term “real-time” has become a bit ambiguous, and you’re often seeing hour-by-hour on a 24-hour delay. This makes it harder to manage and address frequency capping. But advancements in cloud computing services have enabled massive datasets to be leveraged immediately, to ensure truly real-time optimization and even machine-learned insights.
As digital TV matures, what type of innovation do you see being built on the improved infrastructure that digital delivery allows?
I think we’ll start to see more modern features that resemble linear television. Digital’s infrastructure would allow for innovative measurement metrics for OTT impressions that fulfill all parameters of the advertiser’s campaign, like Omnicom’s cost per valuable impression (CPvM) model. For example, MadHive allows buyers to pay a variable CPM depending on how close to the target frequency is.
Is fraud becoming an issue?
The rise of streaming TV is driving revolutionary change in the television industry, making digital targeting capabilities and impression-based measurement possible. But with these benefits of digital also comes downfalls – fraud, transparency, consumer privacy issues, and inefficiencies like frequency capping. As an industry, we need to proactively solve for these problems right from the start. We can’t sit back and wait for CTV fraud to become a $23 billion problem like digital, and we can’t show someone the same ad 10 times in an hour and classify that as an acceptable experience—for consumers, advertisers, or networks.