TV Ad Auctioning Systems: 3 Degrees of Separation, So Far

by Mitch Oscar, Nov 27, 2007, 11:45 AM

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Since the late 1990s, the ad community has been introduced to a variety of television commercial ad auctioning systems. The early models stressed impression delivery at efficient pricing generated through an auctioning dashboard -- basically emulating the efficacy of the online model. Currently, eBay is a noted practitioner. However, the venture has received little press after the broadcast and cable networks, excluding Oxygen, elected not to allocate precious inventory to the trial.

Weeks ago Google took its Sisyphean task of spreading its tentacles to all avenues supportive of advertising by entering into an agreement with Nielsen to provide demographic data for its set top users. Our understanding is that Nielsen and Google are still trying to ascertain which of the Nielsen panelists are situated within the Google TV footprint, which today, is comprised of satcaster EchoStar's 5+ million households (out of 13 million) and thousands of subscribers to an independent cable system in California. Also, of much greater importance, in my opinion, Google has taken the impression-based model and extended it to actual commercial delivery, eschewing program delivery and average commercial pod audience as the currency. Currently, Google auctions its commercial inventory by insertable networks and daypart. I was informed that in the near future, the company plans to open up its negotiation to include networks, dayparts and specific programs.

The latest commercially deployed iteration of the TV commercial ad auctioning model was introduced this fall by interactive TV technologist Navic Networks -- the company known in the community for its interactive TV applications that include request for interaction (RFI), telescoping and microsite creation available in 8+ million homes spread throughout Time Warner, Cox and Charter cable systems. Its ad auctioning model, Admira, combines impression delivery, negotiated CPMs and program context. Navic succinctly describes Admira as follows: "an impression based advertising network that uses census based set top measurement data to place targeted ads based on historical and real time viewership combined with audience behavior." Also, the interface allows advertisers to track campaigns and modify those campaigns continually in real time. Presently, the service is available in two Cox markets: San Diego and Orange County.

Having utilized Navic's iTV applications successfully in Albany and Phoenix for past Hyundai automotive campaigns, ad agency Carat approached its client RE/MAX who agreed that the Admira value proposition would be worth testing. We presented Navic with RE/MAX criteria including viewing preferences (home improvement, house and garden shows, news watchers and viewers who watch women's programming and/or women's networks), targeting information (adults/women 25-54, $75,000+) and specific networks for insertion. As an example of how the segmentation worked in San Diego, Navic was able to distill from the 660,000 cable subscribing households in the market that 100,000 households matched the RE/MAX preferences. Ultimately the campaign traversed 813 unique programs across 48 networks -- concentrating its marketing messages on the program preferences of the designated homes.

The last three degrees of separation between the marketer and its prime target through addressable and auction based TV advertising will be building upon the foundation of real time scheduling and manipulation of (1) impressions, (2) individual commercial deliveries and (3) contextual program participation, and adding: (4) lifestyle data from companies, such as Acxiom and Experian, coupled with addressability to individual households, (5) deploying interactive TV applications -- telescoping, RFI, on demand, microsites -- on top of the previously mentioned degrees of separation, and (6) marrying them to click stream activity for presentation to marketers to match with retail sales. Mind you, always cognizant and respectful of the sacrosanct privacy rights of the television viewer.

There you have it. Six degrees of separation no more. Stay tuned. We will have more to share shortly. For anyone interested in this subject matter, Navic will be presenting the process and results of RE/MAX Admira test at the Dec. 5th Carat Exchange in New York.

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