Author: George Simpson. Source: MediaPost
Shelly Palmer wrote an ominous-sounding column this week predicting that "TV May Actually Die Soon," thanks to the too-cute acronym of FANG that he assigns to Facebook, Amazon, Netflix, andGoogle/YouTube.
In the column, he basically says that FANG has data that marketers want and TV doesn't, and so TV will lose. Says he: "Brands have never wanted to buy CPMs (cost per thousand impressions) or GRPs (gross rating points); they want to sell stuff. The data-rich FANG and other tech giants are offering data that can be turned directly into sales."
I think even the TV folks will confess that buying just demo-based GRPs is fast becoming old-school thinking. But where has Shelly been the past five years, as each and every network has begun to append their minute-by-minute viewing data with third-party data that runs the gamut from Oracle Data Cloud (which tracks $3 trillion worth of purchase a year, including Visa) to Acxiom's 5,000 data elements from thousands of omnichannel sources to Nielsen Catalina Solutions' purchase data from more than 90 million households.
Then there is Nielsen Buyer Insights and Rentrak-TV Solutions Outcome data sources including credit cards, app downloads, first-party data, point-of-sales data, loyalty cards, CRM systems and digital conversions -- not to mention prebuilt syndicated audience segments from IRI, Mastercard, and Datalogix.
And what are the networks and other performance TV companies doing with all this data? They are showing brands that their commercials result in actual in-store and online sales -- or better "business outcomes," if you will.
Mr. P is right in that when all TV was measured in bulk, blunt metrics like age/gender demographics, it was very difficult for marketers to truly understand or optimize media performance across networks. But data, data science, and software have changed marketers’ ability to address these challenges.
Even the big agencies are reformulating how they target TV. Look at GroupM's Modi Media, IPG Mediabrands’ Cadreon, Dentsu Aegis’ Amplifi. Both Omnicom and Publicis Groupe have added TV data expertise. Even independent agencies like Horizon Media are building advanced TV centers (which, one could argue, is aimed more at OTT TV than linear TV, but I think illustrates the momentum toward data-driven targeting.)
Because not all data is equal and often one data set doesn't sync with the next one (or, frankly, some privacy protections), it is true that the TV biz is still a ways away from being able to report: "Ok, as a result of this flight of commercials, the brand achieved this volume of sales." But it is getting closer every day.
A better argument might be what happens if ratings continue to fall, and viewers stay off the big screen in favor of other devices and/or OTT programming. Will TV then have a scale problem that only FANG (or smarter configurations of data-driven targeting) can resolve?
I'd ask Shelly, but I don't think he has a clue.