How Data Trends are Impacting the Future of TV

This is the first part of a three-part video interview series. View the second part, Addressable TV, and the third part, Bold Predictions for the Future of Television, in our more recent posts.

With the Upfronts coming to an end, I interviewed Chris Wilson, President of National Television at Rentrak, on how today’s trends are impacting the future of TV. Here's what Chris had to say:

The biggest trend with the 2015 upfronts is the shift of major networks to more data-driven decisioning and selling—these folks are starting to put together tools that allow them to not just sell the reach of their audience demographically, but combine viewership information with advanced demographics (consumer information) to understand the value of that audience beyond just size. This information enables networks to get premiums and larger shares based on the composition of who their viewers are.

It’s not just hype — I feel that we’re at the beginning of data-driven sales. As audiences begin to change—for these major broadcasting cable networks—and the viewership gets fragmented across traditional live-viewing and time-shifted viewing, it's becoming very important to look at total television viewing across platforms and be able to know who is watching. It's about accountability – being able to align digital advertising with television advertising. And the only effective way to do that is to use data to show the value of that audience.

This is an evolution not a revolution. We currently see a blend of traditional, old-school television demo-based guarantees blended with targeted guarantees. And the networks are bringing in more data and analytics teams to set up data management platforms that combine viewing and consumer data directly from advertisers to create customized programs. In exchange for those services, they're able to get higher rates and larger shares! From a guarantee perspective, you're going to see a traditional demo guarantee supplemented with a targeted guarantee. Over time, this will evolve to the performance and business results the network provides to the advertisers versus just delivery of GRPs.

As this progresses, the relationships between networks, agencies, and advertisers will become more of a partnership and a collaboration between all parties. At the end of the day, the agency wants to provide value to the advertiser by delivering better business results. The networks will get fair value for their inventory by showing the business results that they deliver. So I think it's going to be a function of all those areas—all those different groups working together—to develop programs that combine both traditional television and digital assets to drive the results advertisers are seeking. When advertisers see the value and the results, they will pay for that performance. In many cases, by optimizing against advanced demography and targeting, we've seen a 30-40% lift in using that approach versus the traditional age-sex targeting approach.