"Addressable TV" could bring major changes to commercials

By: Max Hess - Email
By: Max Hess - Email

Posted Thursday, May 8, 2014 -- 10:00 p.m.

Last year, TV commercials were close to a $70 billion business.

They can be funny, they can be informative, the can sell -- but they can also be used for exactly what we call them -- breaks.

"People have developed a mindset that 'it's commercial break, time for me to do something else because there's not enough to keep me'," according to Dr. Jim Pokrywczynski, an advertising professor at Marquette University.

Pokrywczynski has over 30 years of experience in the advertising field, and he says a new technique could be a real game changer.

It's called "Addressable TV", and it lets advertisers target their audiences specifically based on their interests.

So, the commercial you see at home may not be the same commercials someone else sees across town.

Pokrywczynski thinks it could save TV advertising.

"Demographics has always ... believed to be a driving force in influencing various consumer behaviors," he said.

Targets are determined using demographic data, zip codes and types of TV subscriptions.

Anything from household income, to race -- even political stance -- is considered.

For example, if a household has a TV subscription that only includes TV and phone services, they could start to see commercials for services provide TV, phone and internet -- since they are a target household to sell internet services to.

Some big companies are already using it.

About 12 million households at Direc-TV and and about eight million at DishTV; our areas largest cable provider Charter, however, said in a statement that they are not involved with addressable TV.

"From a content standpoint, it becomes more attractive," Pokrywczynski said, adding that "people are going to pay more for that type of content delivery and then the advertising that comes with it is going to be more agreeable."

Bill Kennedy, President of Kennedy Communications in Madison, says Media in general are changing.

"There [are] so many more channels that you have to leverage to get the message to people."

Kennedy says addressable TV is only one way to do that, and it's certainly not without flaws.

"Data has flaws in it and if you're using pure data to reach people, it might make it more efficient, but it's never going to be perfect," he said.

The idea has been floating around for a few years now, and the technology is certainly there, according to Kennedy.

"It's probably better than broad based messaging, [and] in the average you're probably going to be better at messaging than you were before," Kennedy added.

That's why he thinks it is a path more and more advertisers will take.

"It's definitely a thing to come."

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