Tech: Brands are demanding more sophisticated measurement for TV ads — and a startup claims to have cracked the code by using advertisers' own data

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VideoAmp is rolling out its platform to show advertisers how their TV and digital ads drove conversions.

  • Advertising execs are scrambling to pour money into TV software to figure out how effective their commercials really are.
  • VideoAmp's platform plugs into TV viewership, digital ad logs, and set-top data to help brands plan out how much they should be spending in TV.
  • It also pulls in advertisers' own first-party data like email and conversion lists that can be matched against ad data.
  • The company says that 30 marketers are testing it — including ad agencies Omnicom and Mindshare.

Marketers want better proof that their TV ads are working.

The TV industry is a $70 billion market, but digital behemoths like Facebook and Google continue to take bites out of the business. In response, advertisers are increasingly asking to plug data and technology together to target specific audiences on TV and measure how effective their ads are, similar to how digital advertising works.

A cottage industry of TV-minded startups and ad-tech companies is working its way into over-the-top or linear TV buying by promising advertisers access to granular stats to help with media planning and measuring campaigns.

One such startup is VideoAmp, which provides software that pulls all of an advertiser's spend together, including digital, OTT, and traditional TV buys. After testing its software with 30 brands, and ad agencies like Omnicom and Mindshare, VideoAmp is beginning to open up its software to more advertisers.

Here's how it works: Advertisers can log in to VideoAmp's platform to view all of their spend and slice it up to see how specific channels performed using both third-party data collected from digital media and first-party data, like email lists or data that tracks how many people convert from shopping online. The company is also integrated with ad-tech companies like LiveRamp to pull in anonymous sets of first-party data.

The ad spend is matched up with data culled from VideoAmp, including viewership data from smart TVs and digital MVPDs from set-box providers. The company also pulls in reams of data from digital ad server logs.

The software first analyzes which ads were most effective and can then make recommendations for how advertisers better invest future ad spend.

"No one really cares if you're spending all this money and don't see your ad," VideoAmp CEO Ross McCray told Business Insider. "What they really care [about] is that people are going to convert and buy your product, they're going to have higher retention, they're going to show more loyalty."

VideoAmp has raised a total of $36.6 million in funding, most recently with its series B round of $21.4 million last year.

Brands are just starting to figure out how to best split up their resources

By meshing all of an advertiser's spend into one place, advertisers can in theory get a better look at their campaigns and can tell, for example, how many people a TV and digital campaign reached and more specifically, if a campaign was seen by the same person.

That's easier said than done. While TV networks are beginning to work more with each other, marketers still struggle with understanding how their TV spend on one network compares to another, or with digital.

"TV still operates as somewhat of a walled garden," said Allison Metcalfe, general manager of LiveRamp TV. "Working with trusted partners like VideoAmp and leveraging LiveRamp to anonymize both data sets they wish to compare, brands can finally understand the true impact their TV dollars are driving for them."

In one example, a telecom found that 23% of its linear TV ads were being seen repeatedly by the same person, suggesting that the brand overspent on TV ads that were served to an audience. Meanwhile 22% of users who only saw digital ads were under the brand's frequency target, meaning that they didn't see enough ads to sway them to take an action.

McCray said that he's seen two ways that brands are using its software. The first situation happens when brands want to figure out which parts of their advertising triggers a tangible result like someone buying something.

The second use case is brands that want to experiment with squeezing out as much as they can from their ad spend, and they will either cut their budget or want their current ad budget to work better, he said.

"There's a lot of pressure from the CEOs, CFOs, the public markets that are driving these efficiencies," McCray said. "'I need to have an understanding of where my money is going' is always [clients'] first question."

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