Brian Lesser, the CEO
of Xandr (previously AT&T Advertising & Analytics), says that increasingly relevant and engaging advertising, as well as T-commerce initiatives, can supercharge the video and TV advertising
Lesser made the comments Monday morning in a keynote presentation for Advertising Week New York.
“What we would like to do is have advertising be much less interruptive,” Lesser said, adding the company is piloting a number of initiatives on its Turner networks and DirecTV that allow viewers to learn more about products during commercials.
“The benefit to something like that, is you can actually charge a higher CPM because you can measure it, and if you charge a higher CPM, you can bring down the commercial load,” he added.
While the pilot program is happening on Turner networks like CNN and TBS, and the two minutes per hour of commercial time sold by DirecTV to its customers, Lesser says it is a “proof of concept.” Competitors will participate if it is shown to be effective.
When it comes to over-the-top video, Lesser says he sees a marketplace where advertising is prevalent, despite the current market leaders Netflix and Hulu offering ad-free options (Hulu also offers a less-expensive ad-supported option.)
“We are living in the greater age of content production in our lifetimes,” Lesser said. “Much of that content comes from SVOD services, but the economics don’t work in the long run, the SVODs can’t pay for all that content without some advertising model.”
"For the most part, people get the tradeoff between content and advertising,” he added. “We will never get to a world where everything is 100% subscription-based.”
And that includes Netflix, which Lesser predicts will eventually have some sort of advertising.
Xandr has also made rethinking and automating the TV ad market a top priority. The company hopes to leverage the data it collects through DirecTV to provide more value and feedback to advertisers.
As for what that means for companies like Nielsen?
“We will get to multiple currencies,” Lesser said. “There will be an upfront as long as there is risk to take off the table early in the season. Eventually, we will get to a place where advertisers have their own currency.”