Frequency Capping In OTT Will Open the Ad Investment Floodgates

Advertisers have long been aware of the importance of monitoring frequency when it comes to their messaging. With the rise of the digital age and the countless new ad venues that it opened, advertisers recognized the need to avoid exposure to too many ad impressions, both as means of improving the user experience and ensuring their ad buys garner the needed reach.

Enter frequency capping. 

Initially, during the desktop era, frequency capping fell to the publishers that dropped cookies on visitors and ensured they were only served a finite (capped) number of impressions of a given ad.

Moving into the mobile world, the need for cross-device frequency capping between desktop and mobile became an imperative. Frequency capping responsibility moved quickly from the supply side to the demand-side platforms.

Connecting the desktop and mobile dots isn’t always simple, but it’s doable. Advertisers are increasingly employing cross-device frequency capping capabilities across their campaigns through their buying platforms. 

Unfortunately, there’s nothing straightforward about cross-device frequency capping in the OTT and connected TV era. These days, more than 50% of U.S. households use some sort of OTT video services, and 89% of OTT viewing takes place on TV sets. With the shift from linear TV to digital video, the TV now represents another digital device to factor into the cross-device equation, but the underlying plumbing is complicated and unique. 

From a viewer perspective, watching TV is still watching TV, whether it’s linear or OTT. Whether tuning into live sports on a network or queuing up their favorite shows on Hulu via a streaming media player, viewers are kicking back to watch TV and unlikely to give much thought to the delivery system behind their experience. 

On the advertising side, it’s an entirely different story.

If an advertiser like P&G rolls out a new TV ad, it might purchase OTT inventory on both CNN and Hulu. To reach the viewer, those ads will travel through entirely different pipes—ones that are not aware of one another, or any other channels for that matter—to arrive on the viewer’s TV screen. 

While rudimentary frequency caps can be applied at the level of the CNN buy and the level of the Hulu buy, those two delivery systems do not communicate with one another. The result? P&G has no way to measure reach correctly, nor can it accurately apply a frequency cap across its buy. Viewers will be overexposed, campaign optimization will be nearly impossible, and media dollars will be wasted. 

Advertisers Demand a Better Audience Understanding

As larger portions of linear TV budgets shift to digital OTT, advertisers expect the same level of control and accountability that they’ve enjoyed on desktop and mobile to accompany this new channel. This is doubly the case, given the high CPMs that characterize the TV buying world. 

As advertisers increasingly recognize the complexity of this environment, they will demand a solution to the frequency capping conundrum and its associated wasted impressions. If the industry does not deliver one, investment in OTT advertising will fail to reflect the massive shifts in audiences to these environments. 

The solution won’t be simple.

Monitoring frequency in digital and mobile often relies on a unique identifier, such as a cookie or mobile device ID. The OTT environment has multiple IDs per device, both device vendor and individual publisher IDs. Even if a universal ID connecting multiple OTT publishers existed, those IDs still wouldn’t represent individuals.

After all, TVs and OTT subscriptions are much more likely to be shared than mobile devices. That means true OTT frequency capping according to an individual would still remain elusive. 

Solving the formidable challenge of frequency capping within OTT will require unique solutions and, above all, industry collaboration. The size of the OTT ad opportunity is one that warrants cooperation rather than no-holds-barred competition. With cooperation, all parties stand to benefit. Without cooperation, none shall. 


3 comments about "Frequency Capping In OTT Will Open the Ad Investment Floodgates".
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  1. Ed Papazian from Media Dynamics Inc, June 25, 2018 at 9:14 a.m.

    A very interesting and well balanced article, David.

    Another problem that may defy solution regarding frequency capping is the fact that we have no measurement that tells us whether anyone was present or actually watching a commercial. All that we know for sure is that the device was on and a commercial was on the screen. All of the evidence indicates that, at best, only half of the "audience" pays at least some attention to an average commercial and the fully attentive ratio is, of course, still smaller. So when an advertiser caps the frequency of "exposure"---assuming that at some point this will be truly feasible across platforms--- at seven times---based on device activity--- the ad campaign  may actually be reaching that consumer only three  times. In this context, trying to reduce the target audience's "exposure" rate from seven to , say, three, on the assumption that seven is overkill, may be a questionanble decision. If you go to three, via capping, you may only be getting one or, for a few,  two actual exposures------which may be too little.

  2. John Grono from GAP Research, June 26, 2018 at 7:59 p.m.

    Sage as always Ed, and yes a good post David.

    But just to re-hash a little bit of history David.   What you say about frequency capping in the desktop days was not as clear cut as that.   There were a few main issues:
    * cooking clearing - such as running Norton once a week re-set the cap-count back to zero
    * work and home usage- while it has diminished in importance with the uptake of mobile devices it was a very big problem but barely recognised
    * public place usage - taking you latop to college, Starbucks etc if you relied on IP addresses rather than registration

    Collectively these issues (and others) massively overstated the monthly data.

    Ed, there are multiple levels to this issue - before we even address the human 'attention' problem (and the multiple device problem):
    * all server-side-only metrics have zero ideaas to what the user is really doing, let alone what they are paying attention to
    * while pages (especially ads) might be getting served, (in general) only one browser page is in-focus.   In fact, there may also be multiple browsers open, as well as multiple applications
    * server counts have no idea as to what is 'in focus' (though time thresholds can help mitigate this)
    * only OS-level applications can know what is REALLY being used on a users device - but even then it has no idea of attention levels ... yes that means panels of real people and real users.   For example, the other six MediaPost tabs I have open are racking up duration data while I type this in this tab. 

    Hybrid approaches are the best chance of providing data (I refrain from using the word "measuring" deliberately) in which traffic and validated time data from servers (via SDKs etc.) are melded with actual usage data.   Australia's DCR ratings (launching soon) use this type of approach.   Not everyone is happy ... because the new system addresses many of the issues raised above which inevitably means lower numbers.   And finally, any new system is not perfect - it just has to be better than the system it replaces and be fit for purpose.

  3. Ed Papazian from Media Dynamics Inc, June 27, 2018 at 5:47 a.m.

    John, while I agree that "eyes-on-screen' is not, by itself, a complete indicator of viewer interst in either program content or commercials, it must be highly correlated with same. If a viewer stays in the room and his eyes are on the TV screen for 20 of the 30 seconds while a commercial plays out  but the same viewer's eyes are on the screen for only the first five seconds of the next 30-second commercial in the break, I'd wager that an ad recall study as well as some form of autonomic measurement would, in most cases, find that the first ad had much more impct than the second. Of course there would be exceptions and the correlations between the various indicators would not always be as tight as one might like, but I think that it's a mistake to dismiss "eyes-on" as having little value. What's needed is a combination of methodologies---each pointing in its own way towards attentiveness, communication, response, etc. ---and "eyes-on-screen" is certainly one of these.

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