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Future of TV Briefing: How outcome-based measurement may figure into this year’s upfront market

March 13, 2024
in General
Future of TV Briefing: How outcome-based measurement may figure into this year’s upfront market
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This Future of TV Briefing covers the latest in streaming and TV for Digiday+ members and is distributed over email every Wednesday at 10 a.m. ET. More from the series →

This week’s Future of TV Briefing looks at how business outcome measurement and guarantees may figure into this year’s upfront market.

TV and streaming advertising remains predominantly a game of reaching as many people as possible. But generating results from that reach — such as foot traffic to stores and downloads of mobile apps — has been a growing consideration among ad buyers and sellers and may play a bigger role in this year’s upfront market.

“The number of advertisers [in this year’s upfront market] that are going to presuppose that you’re talking about the full loop [from reach to conversion] as part of the conversation, that’ll be at an all-time high,” said Sean Cunningham, CEO of VAB, the industry trade organization representing TV networks.

A+E Networks has been among the sellers pitching advertisers and agencies on transacting against business outcomes, having started offering business outcome guarantees in 2018. This year the TV network owner will add a pre-campaign planning tool to the mix. Called InterAction, the tool uses MarketCast’s brand and ad recall data, EDO’s search-based behavioral data and TVision’s attention data to provide advertisers with a look at how A+E Networks’ audience performs against attention, recall and search metrics before committing to buying against business outcomes via the company’s Performax program.

“Having the capability to be able to guarantee against those business outcome measurements based off of the insights and findings that we had before even entering into a campaign with [an advertiser], we’re bringing them over that mountain of understanding pre-campaign, guaranteeing in-campaign and then being able to give them all of the results throughout the entire process,” said Rosann Montenes, svp of ad sales for audience solutions at A+E Networks.

A seller being willing to guarantee delivering on business outcomes — and putting itself in to have to make up for any shortfalls — may seem like comfort enough for advertisers. But as A+E Networks’ InterAction introduction indicates, some ad buyers need a bit more confidence when weighing whether to buy an outcome-based pitch.

At issue among ad buyers is that measuring ad exposures against business outcomes is a pretty advanced form of measurement and at a time when something as fundamental as just measuring ad exposures is in flux.

“It’s just so complex. Part of that is we have been the past two, three years just establishing how we even measure. Who should we be using to measure the right number of eyeballs before we even get to taking an action or attention or anything like that?” said one ad buyer.

Moreover, ad buyers may prefer to transact against the traditional reach and frequency metrics and calculate the resulting business outcomes on their own. This way the brand and its agency have more control over the data and methodology used in the latter calculation.

“We always take what the currency that’s available and used, and then we map it back to our outcomes with our data,” said a second ad buyer. “For example, we’ll take a client and see what the outcomes are based on real results, and then we’ll map that back to an upfront [deal]: what they’re going to be purchasing, how much they should be purchasing it for, what type of spend levels they should be allocating towards certain events.”

But then, that strategy suits ad buyers that are already measuring outcomes against ad exposures. What A+E Networks seems to be aiming at with its InterAction tool are the advertisers that are not so far along in associating exposures and outcomes and are open to the business outcome guarantee pitch but want some assurances ahead of time.

“We have the business outcome understanding pre-campaign, and then we’re measuring it in-campaign. It’s this extra layer of confidence that we have. It’s almost like an insurance policy before walking into any room with any of our clients,” said Montenes.

What we’ve heard

“The demand for national linear addressable, even to this day, has not gained any traction.”

— Agency executive

Next month, Digiday’s Future of TV video series will return, and this year’s edition will center on streaming, including the infrastructure powering the streaming ad market. As part of the lead-up to the series, I put together a short video to go along with Digiday’s explainer article on server-side ad insertion, which is a primary component to streaming’s ad infrastructure.

Numbers to know

5 million: Number of subscribers that major U.S. pay-TV providers are estimated to have lost in 2023.

-7%: Percentage decline year over year in traditional TV ad spending in the fourth quarter of 2023.

50%: Percentage share of new Hulu subscribers that sign up for Disney’s Hulu-Disney+ bundle.

What we’ve covered

Renewed call to ban TikTok could push creators, ad dollars to YouTube Shorts and Instagram — which may hurt creators:

Congress is renewing its call to ban the ByteDance-owned video platform.

The renewed call has drummed up concern among creators to diversify beyond TikTok.

Read more about the potential TikTok ban here.

Why marketers are not deterred by TikTok’s uncertain future:

Advertisers have yet to pull back budgets from the platform amid the renewed ban talks.

TikTok’s standoff with Universal Music Group also has yet to affect ad spending.

Read more about TikTok here.

What we’re reading

Apple’s TV ad sales staff:

The tech giant has hired NBCUniversal veteran Joseph Cady to join its expanding advertising division and lead its data-driven and targeting TV ad efforts, according to Insider.

Netflix’s live sports portfolio:

Netflix may claim not to be interested in acquiring rights to livestream major sports, but it keeps adding live sporting events to its service, the latest being a boxing match between Mike Tyson and Jake Paul slated for July, according to The New York Times.

Facebook’s AI-based video recommendations:

The platform’s parent company Meta is developing AI technology that Facebook will use to determine which short-form and long-form videos to promote in people’s feeds, according to CNBC.

X’s CTV play:

The platform formerly called Twitter plans to launch a connected TV app for Amazon’s and Samsung’s CTV platforms that supposedly apes YouTube’s CTV app, according to Fortune.

Twitch’s mobile app:

The Amazon-owned livestreaming platform plans to release an updated mobile app this year that will make its discovery feed — akin to YouTube’s recommendations feed and TikTok’s “For You” feed — the app’s primary feed, according to Engadget.

TruTV’s sports-centric refresh:

Warner Bros. Discovery is remaking its cable TV network from one oriented around reality TV programming to one that also airs live sports (which, I guess, is technically reality TV), according to Variety.

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