More Marketers Test Targeted Ads on Streaming Platforms

The automobile recommendation site Cars.com used to run its advertisements on TV, aimed at a broad swathe of consumers. But since early 2019, the online company began running its ads on streaming TV platforms such as Amazon Fire TV and Roku to target their ads more precisely to people shopping for cars. Targeted advertising is taking off as a trend because many factors now make it possible to more narrowly aim them to relevant viewers. Some of the data now available includes income, purchase history and web-browsing behavior.

The Wall Street Journal reports, “marketers can use the streaming platforms to reach a larger and more geographically diverse group of people across the U.S.,” which is also prompting the move. “Traditional TV is awesome at helping us build awareness and getting our name out there, but it doesn’t offer us the ability to efficiently target people shopping for a car,” said Cars.com vice president of brand marketing Seth Goldberg. “We’re meeting consumers where they are.”

Cars.com reported a “bump in traffic” after a months-long targeted ad campaign, “coupled with a more traditional WarnerMedia sponsorship on NCAA.com during March Madness and digital ads around the Super Bowl.” It now plans to spend 6 percent more on targeted TV ads and 12 percent less on traditional ads, compared to 2018.

Although targeted ads were introduced some years ago, “now streaming TV players like Roku, Hulu, Sling TV and DirecTV Now are helping the market to develop by increasing the available ad space … [with] their growing user bases … sprinkled throughout the country.” “We’re finally seeing some momentum, versus lots of little tests,” said Omnicom Media Group chief research officer Jonathan Steuer.

According to eMarketer, however, spending on “Roku and Hulu [is] making up under 1 percent of the $129 billion U.S. online-advertising market in 2019 … and regular, broad-reach TV ads will remain the mainstay for the foreseeable future.”

The Interactive Advertising Bureau released a study in April showing that “nearly 60 percent of advertisers … plan to increase their budgets for advanced TV, including streaming content and devices and addressable video.” “We’re seeing more advertisers wanting to put their foot on the gas,” said Matter More Media co-founder/chief executive Tracey Scheppach, whose company consults on targeted-advertising. “Now that traditional ratings are so low, you have to think differently.”

Some marketers are blending strategies, “using targeted ads to push a specific product while sticking with traditional ads for the overall brand,” in large part because targeted ads tend to be more expensive than traditional ones.

At Experian Consumer Services, for example, head of integrated marketing Steve Hartmann said traditional TV ads have helped promote “a core identity-protection product” aimed at older consumers, but targeted ads on Roku promoted Boost to a younger demographic. Experian is also buying ads through Hulu and YouTube. Both Hulu and Roku are experiencing increased ad revenue due to these hybrid strategies.

Related:
Ad Creators Get Inspiration From Big Data, The Wall Street Journal (subscription required), 6/17/19