Lessons From Across the Atlantic: What Europe Can Learn From US TV Advertising

By Virginie Dremeaux, Executive Director, Product and Sales Marketing International, FreeWheel

From theme parks to fast food outlets or reality TV shows – there’s a long history of ideas succeeding in the US before they find their way across the pond to European shores.

Addressable TV is one such concept that is already accelerating in the US, with ad spend on this channel rising almost 40% last year according to eMarketer. Media buyers in Europe are expected to follow suit, and over half are planning to allocate more than 10% of their budgets to advanced TV advertising formats such as addressable TV in the coming months, according to a recent FreeWheel survey. With almost a third of European advertisers surveyed currently looking to onboard more targeted advertising techniques, addressable TV advertising is likely to expand across the region. So what lessons can Europe learn from the US in relation to this format?

Use addressable to complement linear

Traditional linear TV advertising is still incredibly effective at quickly reaching large audiences and achieving campaign objectives at all levels of the purchase funnel, but experience from the US reveals that it works best in conjunction with addressable TV advertising. Adding linear addressable to traditional TV advertising offers advertisers the ability to target TV audiences at the household level without limiting campaign reach.

Therefore, addressable TV advertising could well complement linear TV advertising and achieve incremental reach, perhaps by targeting audiences that aren’t watching a lot of traditional TV, or in regions where ad messaging isn’t being delivered with the necessary frequency to drive results. It could also be used to address different creatives of a single campaign to specific audiences and so, keeping the full reach of the ad slot, optimise the relevance of the ad messaging to the audience. Small brands that don’t have the budget for a full national TV campaign might use addressable as a stand-alone tactic to reach specific niche audiences or local areas, but larger brands could use it as one component of a complementary set of advanced TV advertising capabilities.

Set clear addressable objectives

When advertisers are offered the ability to match their own first-party data or other third-party data sets, with household-level TV viewer data, they can develop addressable advertising plans to meet clear objectives at all stages of the funnel. At an upper-funnel level, advertisers in the US are using addressability to access specific consumer segments that are too narrow to reach or monitor effectively via a wider linear TV campaign, or to purposefully target viewers that are not current customers.

Advertisers can use addressable advertising to target in-market prospects or customer renewals and drive customer intent to buy a product or service by delivering messaging that is different from their broader TV campaign. They can also react to competitor advertising activity and use addressable to maintain or increase their share of voice in households exposed to competitor campaigns. Addressable advertising can even be used post-purchase, to reinforce the customer’s buying decision by communicating new features or service-related offerings. As addressability enables precise measurement and performance attribution, campaigns can be adjusted and optimised in flight to drive advertisers’ specific objectives.

Support collaboration where necessary to drive scale

Increasing the availability of addressable inventory to achieve the scale advertisers typically look for requires some collaboration between programmers and distributors. In the US last year, the launch of the On Addressability initiative brought dynamic ad insertion capabilities across the Charter, Comcast and Cox television footprints, priming both video-on-demand (VOD) and linear TV for tailored advertising. Since its launch, the initiative has already expanded its inventory with AMC Networks and Discovery.

Similar collaborations are beginning to occur across Europe, but many initiatives are country specific, such as the LOVEStv platform in Spain, the deals between FranceTV and both Bouygues Telecom and Orange in France, and the AdSmart partnership between Sky, Virgin Media and Channel 4 in the UK. A shift towards collaborations with international reach and some level of regional homogenisation may act as a catalyst for change.

The advance of addressable TV in the region will be supported by marketers ready to embrace this innovative way of buying TV inventory and start the learning process of this new opportunity. Addressable TV advertising is already thriving in the US and is beginning to gain traction on this side of the Atlantic, allowing advertisers to make more comprehensive advertising plans through data-driven audience matching, precise measurement and reporting, and in-flight campaign optimisation. To make the most of addressability, European advertisers and agencies could get inspiration from their American counterparts, using addressable TV advertising as a complement to linear advertising, setting clear objectives for targeted ads via addressable solutions, and starting to embrace this new ground-breaking opportunity by implementing a test and learn period to fully understand its potential.