Targeted TV Ad Model: Road to More Effective Advertising?

Computer-driven targeted TV advertising could allow advertisements to reach 18 percent more consumers than traditional television advertising, according to researchers at AT&T Labs. The study used viewing information from cable boxes to determine what demographics watch what shows, and at what times of day. The study then analyzed different advertising patterns for a car manufacturer and a retirement planning/investing firm.

The research mimicked online advertising methods where software matches advertisements to users based on data. Traditional television advertising does not work this way.

“TV advertising is today bought and sold in much the same way it has been for decades,” explains MIT Technology Review. “A company that wants to advertise works out who it wants to see its message, and tells that to a TV station, where experts use ratings information from surveys, and their own judgment, to decide when best to run the commercial and how much to charge.”

Heather Way of Parks Associates says a change in methodology would improve the advertising experience for everyone. “It’s more efficient for the ad buyer; the provider can get a higher rate for their ad; the consumer is not bombarded by a bunch of content that’s not relevant,” she explains.

“Most people don’t know that their TV provider tracks channel changes,” notes the article. “Some advocacy groups may protest the possible privacy implications of such techniques, but Way believes viewers will likely be even less concerned than they are about online ad targeting.”

“It’s a medium that consumers are just more comfortable with,” she says.