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Informe sobre el aumento y las ventajas de la publicidad online, KPMG (versión en inglés)
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Informe sobre el aumento y las ventajas de la publicidad online, KPMG (versión en inglés)
Jul 12, 2010
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Informe sobre el aumento y las ventajas de la publicidad online, KPMG (versión en inglés)
1. COMMUNICATIONS & MEDIA Networked Advertising Growing revenue in a highly fragmented business ADVISORY
© 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Table of Contents Introduction 1 Digital Is in a Shakeout Period – Brad Armstrong, Martin Agency 3 More Complicated Than Ever – Greg Stuart, Former CEO, Interactive Advertising Bureau 6 Unmeasured Is Undervalued – Daniel Monistere, Nielsen 10 Listening to the Market – Tracy Benson, Best Buy 13 Technology and Brand Measurement – Dan Beltramo and Nick Rau, Vizu 17 Ad Networks Are Not Going Away – Mike Woosley, TidalTV 20 High Impact Media – Walker Jacobs, Turner Entertainment 24 In Summary – Intelligent Business Decisions Are Needed 28 © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
1 Networked Advertising Introduction The advertising business has changed forever. Historical boundaries found in traditional print and broadcast advertising no longer apply online. In turn, broadcast television, cable television, print, and outdoor advertising are now challenged to adopt new paradigms. The industry is still very strong, but many leaders now insist that advertising as we know it will have to adopt completely new digital business models to survive and thrive going forward. Those new business models and new ways of understanding audiences will, in part, shape the future of the industry. What has caused such a dramatic and For this white paper, KPMG went to important change? The Internet and the seven leading executives in the digital notion of free content “when I want advertising ecosystem. We asked each it, where I want it, and how I want it” of these subject matter specialists to has completely upended the traditional address a specific perspective based on advertising networks. Even the notion company roles. They generously took time of data measurement has changed. to answer our operational, financial, and Executives across the ecosystem are process questions and share their broad struggling with declining subscriber knowledge about the digital advertising trends, data and revenue clarity across ecosystem—including the roles of other vendors, and consumer cost expectations participants. The result is a thorough look —all in an era where the consumer at the risks and opportunities ahead for “retail” experience is more expensive and advertising in the Internet era. Please risky than ever. Nevertheless, the roles read on to learn more about this fast- of the advertiser and consumer remain changing and complex space. essentially the same. Ad agencies still strive to create compelling marketing messages. Publishers still produce content advertisers want to associate with. Broadcast and cable television, newspapers, magazines, and radio still have the real estate and the means to reach the eyes and ears of consumers. © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Networked Advertising 2 Introduction, continued THE ADVERTISING The Digital Advertising Ecosystem ECOSySTEM TODAy Advertiser Ad Agency Advertiser. Seeks to promote goods or services via online/mobile properties. Ad Agency. Creates the online/mobile advertising campaign for the advertiser. Ad Server Ad Server. Technology that distributes the ads across online/mobile properties. Can be run by the publisher Ad Network or a third party. Publisher Publisher Publisher Publisher. Owns the online/mobile (Online/Mobile) (Online/Mobile) (Online/Mobile) properties where the ads are displayed. Ad Network. Manages and serves ads to a group of online/mobile properties. Ad Flow Content These groups may be controlled by Content Flow Consumer Owner a single publisher or aggregated by a Revenue Flow third party. Source: KPMG LLP Consumer. Receives the advertising when surfing online/mobile properties. Content Owner. Controls the content U.S. Online Advertising Spending, 2007–2013 (billions) that brings consumers to online/mobile 40 properties where ads are displayed. Can be the publisher or a third party. 35 $37.2 30 $33.7 $29.7 25 $26.8 $24.5 20 $23.4 $21.2 15 10 5 0 2007 2008 2009 2010 2011 2012 2013 Source: eMarketer, April 2009. © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
3 Networked Advertising Digital Is in a Shakeout Period The Agency Perspective Brad Armstrong is group account director and partner at the Martin Agency, winner of the 2009 Advertising Age Agency of the Year Award. The 40-year-old firm is part of the Interpublic Group and has billings of about $600 million. The Martin Agency interactive department, created 15 years ago, is fully integrated with teams focusing on print, TV, direct marketing, and PR. Armstrong is lead account executive for Wal-Mart, the agency’s largest client. “It’s a high-energy, complicated, messy products and services they genuinely time right now, says Brad Armstrong. ” want to see. But marketers need more Companies are jockeying for position long-term comparative studies of and trying to decide what their core marketing approaches and consumer competency will be. Online media reactions to learn key points in user placement companies are undertaking search and conversion decisions. “Until creative work, and creative companies marketers are able to track user behavior are buying online placement and video online to understand how consumers companies. “Chief marketing officers transact a session on the Web, we’re not are confused about digital advertising going to be able to target effectively, ” and can’t distinguish the players, says ” says Armstrong. Armstrong. “They need a guide. ” He recognizes that the flip side of What consumers are willing to pay for obtaining enough behavioral data to online also is problematic. The newspaper generate patterns of usage is a potential business faces that problem daily as privacy backlash: “People don’t really more and more people read the news want every click and keystroke to be online and forgo buying a paper. known to the world. ” Because fee-supported online news Still, Armstrong has no doubt that has generally failed, Armstrong thinks researchers soon will create a program or advertising-supported online content is metric to make sense of online behavioral the way of the future. data so advertisers can understand the patterns of the people they want to BETTER DATA, STANDARDS ARE influence. “Digital marketers spend hours NEEDED online, tweeting, and Facebooking to better understand consumer behavior, The promise of advertising online is its but the average customer treats online as potential to collect data that marketers a utility, he says. “When we finally see ” can use to target consumers with where our message can intersect user © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Networked Advertising 4 Digital Is in a Shakeout Period, continued behavior in that utility—when we crack Two things are important about the “Whoever figures out and provides the the code—online is going to be the most interactivity of mobile, he believes: One best interface between mobile requests cost-efficient marketing vehicle in history. ” is that users will be able to search and and the data response to them is going to get an answer wherever they are. Two do really, really well. ” One impediment to that vision of is geotargeting. “A year or so ago in efficiency is a lack of agreed-on data- Near term, he thinks it is possible that New York, I saw a bus come down Fifth exchange standards. The wide range of Google and the Android cell phone Avenue. It had a digital panel on its side proprietary technology formats creates operating system may provide an that advertised a restaurant a block away inefficiencies, and different groups open source alternative to fragmented from where I stood, Armstrong says. ” with different agendas promote vying operating systems. “Google wants to be “I thought, ‘That bus will go down Fifth standards. This complicates tasks as the organizer of the world’s information, Avenue—or anywhere—and depending on simple as reporting digital-content so that wherever you are, if you query its location and who has bought ad space, sales from downloads or streaming. Google, it will be able to give you the its message will change to promote Not only are current reporting and data information relevant to your search and, whatever restaurant is nearby.’” standards a problem, intermediary groups along with it, marketing communications continuously add to the load by creating Handhelds are already GPS-enabled from all the people willing to pay to talk to new mechanisms and programs that to a large extent, he continues: “As it somebody asking that question, he says. ” transfer digital information. becomes the norm, you will be able to Consumers will choose how much access search for information based on your Brand advertisers are not really aware of to their movements they permit, however. location. So if I’m on Fifth Avenue and standards as an issue. “What they want is Those who prefer not to be tracked 37th Street in New York and I’m hungry, someone to make sense of it all for them, wherever they go will opt out, says I can query restaurants on my handheld so they can make intelligent business Armstrong. Those who opt in will give up and obtain a list of nearby restaurants, decisions, says Armstrong. ” some personal information (as on joining perhaps with menus, Armstrong says. ” Facebook, for example) in exchange for THE NExT MOST-IMPORTANT access to the location-based data they SCREEN IS MOBILE want. “Google wants to be the The key screen went from the TV screen organizer of the world’s The traditional advertising concept of right to the computer screen, and the next key information, so that wherever you ad, right time, and right place continues screen will be the one you hold in your to be valid online if you add “right person” are, if you query Google, it will be hand, Armstrong believes. He sees that to the formula, he says. A message shift happening over the next decade, able to give you the information and ad may be right, but marketers driven by technology improvements relevant to your search and, have to identify the prime prospect and such as iPhone’s customization of the along with it, marketing understand his or her behavior to be able handheld screen. Consumers are getting to time the message. communications from all the used to looking at things in miniature, but people willing to pay to talk to The way things are going, Armstrong the medium requires different tools and thinks it is likely there will be $100 million different creative approaches, he says. somebody asking that question,” of mobile advertising media buys in the Armstrong says. next few years. “The technology and the © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
5 Networked Advertising Digital Is in a Shakeout Period, continued data feeds are not quite right yet, but all built footage for online and mobile are makes a social network attractive to an that will change in the next couple years, ” behind the curve but will catch up quickly. advertiser is the level of involvement he says. “So will the behavior of the “You pay for additional production, but people have with it. Smart marketers carriers, who are notoriously protective of people are realizing that work customized are finding ways to woo such sites to subscriber data.” for the online space is more effective. ” get their message across. For example, communities of involved moms are RETURN ON INVESTMENT There’s significant pressure to provide gathering to share tips for raising their entertainment value with any message, kids. Marketers are trying to join those In theory, advertisers should be able too. A dry selling message irritates communities carefully by providing to have a more accurate notion of the people, especially if there’s a lot of information that helps them navigate their return on advertising spend (ROAS) in uninteresting noise attached to it. “The job as moms. an online world, but much depends on challenge for companies like ours is to the business. “I’ve seen 20 models in provide entertainment that is a gift. We’re “Small communities will emerge, I think, the past 12 months, and none of them the uninvited guest, so we’ve got to and they will consist of the 100 people is exactly right, says Armstrong. “Every ” entertain them or they’ll be angry at us, members really want to talk with—like major marketer is struggling to do a and we’ll be rejected. We can’t let that a family network, says Armstrong. ” mixed media modeling program and to happen. ” Companies are starting to provide understand the return from the different platforms for such small communities, mediums including online. There’s a long SUCCESS WILL HINGE ON and sponsoring them is a place where way to go before we can understand RELEVANCE a marketer can get traction. “Over the ROAS unless you’re a very structured next 30 years, we’re going to see the “Over the next 10 years, advertisers are seller of something online, and you can online growth of niche communities going to get smarter about how to target just track it right through a sale. ” that marketers join or sponsor, providing their messages and about what content information relevant to that group. ” One company is beginning to see more actually drives brand or transactional value success based on consumers watching for them, Armstrong says. “I foresee a ” ad-supported content online. Episodes huge shakeout, after which there won’t be on demand from abc.com are all ad- as many profitable information sites vying supported, using video advertising that is for advertising, but instead there will be a mainly repurposed from an original shoot lot of transactional sites that sell over the for television or cable. Because of the Web. Many colleagues think there will be expanding bandwidth, the opportunity for more information sites, but very niche- rich content is huge, he thinks. driven. For example, a site for people who own or are interested in Mustangs from Armstrong says, “Any players worth the ’60s is exactly the right place for a their salt these days are creating work seller of chrome replacement parts. ” specifically for digital use. It may be shot at the same time as the TV commercial, The social network space is not as utility- but if they know what they’re doing, driven as other online interactions, and they’re customizing it for use on the social sites are more relaxed and willing Web. Agencies not shooting purpose- ” to accept messages—but not ads. What © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Networked Advertising 6 More Complicated Than Ever The Industry Perspective Greg Stuart has insights that stem from a diverse advertising career that includes five years as CEO of the Interactive Advertising Bureau (IAB)—an industry group of more than 400 leading media and technology companies that sell nearly 90 percent of online advertising in the United States—and coauthoring the book What Sticks (Kaplan Business Books, 2006) a research-based look at what makes advertising effective. “As the digital advertising ecosystem Online, a marketer’s dollar dwindles evolves at a furious pace, its myriad to nickels and pennies en route to a technical complications, options, publisher (or whoever touches the and opportunities seem almost consumer last), Stuart explains, because overwhelming, Greg Stuart says. ” of all the pieces needed to make a buy “The relationships between agencies, today. The online marketer can go directly media buyers, ad networks, exchanges, to the publisher or through an agency data providers, verification services, or an ad network or a connector to the measurement companies, publishers, new world of exchanges such as DataXu. and content owners have become “But I’m not sure any stakeholder fully interwoven, obscuring participants’ roles, understands how a network connects true value, data ownership, and consumer to other networks, to exchanges, or access. If—as an industry joke goes— to publishers, let alone how data gets ‘advertising was a business created for attached or how ads are measured, ” C students,’ that isn’t the case any longer. ” he says. To write What Sticks, Stuart and his Despite the fact that the advertising coauthor, Rex Briggs, conducted research technology ecosystem is so complex, against $1 billion of ad spending in the online sector and other digitally TV, radio, magazines, and online—the networked channels are well positioned entire media spectrum. “Our sponsors to gauge return on investment (ROI). were top-50 marketers who wanted to While still less than 10 percent of ad answer a simple question: What is the outlay, online advertising is more oriented value of each advertising dollar spent, by to applying ROI theories and processes. medium?” Their research led them to the Stuart thinks that may ultimately attract conclusion that more than $112 billion the brain power needed to really was being wasted of the then-annual total capitalize on the opportunities. of $300 billion in advertising spending. © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
7 Networked Advertising More Complicated Than Ever, continued WHAT GETS MEASURED… click measurement is a disservice to the strategic advantage should apply to field. Actual sales or purchase intent (or ” more than just ad impression counts. Stuart hosted about 20 dinners a other metrics whose value are still to be We have a powerful weapon in simple year with marketers and agency proven—the key being “proven”) are a ad effectiveness tools such as Dynamic representatives when he headed the IAB. significantly better measure of advertising Logic and Vizu, but our syndicated As he listened to dinner conversations, it effectiveness than click-through, Stuart research needs to be higher quality.” struck him that marketing professionals believes. had little grasp of how advertising really works and even less understanding of NUMBERS GAMES “If you had told me five years online advertising. “Digital has really ago I’d spend four hours or shown that the emperor has no clothes One of the best things the industry accomplished during Stuart’s tenure at more a month managing my —that meaningful education, training, and insight are in very short supply in the IAB was to clean the metrics used relationships on LinkedIn and advertising, Stuart says. ”That is probably “ to count ad impressions, which is the Facebook, I’d have thought ‘no why we found that 47 percent of the 30- underlying currency of the industry. way.’ Yet I do just that today,” odd campaigns we measured for What “Before 2003, ad servers had major discrepancies in ad impression counts Stuart says. Sticks failed before a media dollar was spent, and 83 percent of those campaigns of from minus 50 percent to plus 100 lacked optimized spending allocations. ” percent. The IAB worked hard to get Online advertising’s complexity makes it a global technical standard on how to hard to verify whether an ad reaches the “What I think is wrong with advertising measure impressions, so such differences consumer without an independent body overall, he says, “is that within the ” now are about 10 percent or less, Stuart ” tasked to do that. Anchor Intelligence, industry, incentives are completely says. “Getting a technical standard in for example, has “developed technology misaligned. Agencies often are paid on place showed us there was a lot of that a single agency could likely never either percentage of spend or hours human error in how campaigns were build” to verify whether a click was valid. invested, neither of which puts the focus executed. Process standards are needed, Other services to verify that an ad really on advertising effectiveness—which too,” Stuart says. ran when and where it was supposed should be the goal. Everyone says that’s to are in development. These services the goal, but in my experience, their “If advertisers don’t trust online’s need more support and more industry actions suggest otherwise. ” numbers, the medium is dead or guidance. To the extent that they validate dreadfully stalled,” Stuart says. “Also, Asked what he thinks has been the effectiveness of digital campaigns, we made a strategic decision in 2002 to the biggest mistake made in digital they will provide insight and confidence measure actual ad impressions rather advertising, he says, “No research to marketers and agencies. The days of than just the content, which is what other anywhere in the world validates that simply watching to confirm that your media measure based on ‘opportunity- a click has any relationship to brand commercial aired during 60 Minutes, to-see.’ (TV or radio measures average effectiveness, yet click-through is the de are over. quarter hour in program; print measures facto measure most online marketers the complete magazine or newspaper.) and their agencies use. Overreliance on Using numbers/data/research to © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Networked Advertising 8 More Complicated Than Ever, continued WE NEED TO TURN UP THE HEAT COSTS WILL DROP I’d have thought ‘no way.’ Yet I do just that today.” Stuart says serious complications also “Can content be monetized profitably? result from the fact that the Internet is Of course, Stuart says. He cites an ” It perplexes Stuart that marketers don’t a global medium that can be accessed early-2002 Wall Street Journal editor’s see the opportunities. “As a former anywhere in the world. “I know of letter on Internet media that said CMO, it bugs me that they don’t see some publishers that knowingly sell advertising would never support online the advantage of jumping in early. My international audience impressions— content. Skeptical, Stuart checked the background is in economics, and it was worthless in the United States—to data of all the relevant public companies. clear to me in 2001 that high supply domestic advertisers, he claims. “That’s ” (increasing consumer Internet access) “It was a difficult period, he says, “but 35 ” and flat marketer demand would make egregious, Stuart says. ” percent of the public companies projected online media the deal of the century. My “In 2002, we went to the IAB board profitability by the end of that year, and book research just proved what should about the issue of selling international 95 percent projected profitability by the have been intuitively obvious, Stuart says. ” audiences to domestic advertisers end of the following year. And they all Today, he thinks exchanges and demand without notification. A few publishers did achieve profitability. The Wall Street trading platforms such as DataXu and did not want this fact made public or to Journal just hadn’t looked at the data. MediaMath offer great opportunity. change their practices. When the wrong Meanwhile, advertisers accepted that incentives are in place, companies don’t editorial view as fact and stayed out of MOBILE—A MOVING TARGET? act in the interest of their customers. ” the online medium. ” “I did some research for an Adweek Similarly, a CEO who realized his company Reports that YouTube doesn’t make article a few months ago, and 76 percent had huge fraud issues in its system wrote money annoy him as well. YouTube of advertising people said they would to several second-tier companies in the generates a lot of revenue, Stuart asserts, accept advertising on their mobile phones search ecosystem to suggest organizing and its consumer and content acquisition only ‘over my dead body,’” Stuart says an industry-level effort to eradicate click costs are low. That suggests its reasons with amusement. Regardless, “Mobile fraud. His contacts said “good idea” for not being profitable may be that the meets my qualifiers for being a valuable and went to talk to their internal people. company is choosing to invest for the media vehicle in that it does something Reportedly, many came back to him and future. Stuart thinks marketers may be unique by offering marketers consumer said, “I’m sorry, we can’t participate in using faulty information to not explore the proximity and greater personalization, ” this. We make too much money from click channel, which is a big missed opportunity Stuart says. fraud.” for them and their brands. “Consumers distrust mobile advertising So it goes back to incentives, says Stuart: However, the biggest opportunity right because of how badly other media, “If the media company or the search now in online media is likely social media, including online, have acted. For instance, companies had been judged solely on which is becoming “deeply engrained in the television industry is crazy to think producing effective results at the sales consumers’ lives, Stuart says. “If you ” that nearly 20 minutes of commercial level—rather than on revenues or clicks had told me five years ago I’d spend four time in an hour show is acceptable to —those people would not have made hours or more a month managing my consumers. And the Internet was nuts to those choices.” relationships on LinkedIn and Facebook, have done pop-ups, Stuart says. ” © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
9 Networked Advertising More Complicated Than Ever, continued “Consumers are transferring their BE CAREFUL WHAT yOU WISH FOR THERE IS STILL A LOT TO DO distrust to new media, where they have more control. On sensitive issues such as In the end, advertising is still all about Infrastructure needs to be built, including privacy, they have little basis to trust that putting the right message in front of the tools to make it easy for big and small, we, as an industry, will act properly. Those right person at the right time. Targeting national and local advertisers to come issues are manageable only if the industry is one element of doing that, but Stuart onboard. Ads have to become as really polices itself. Under Randall thinks targeting is both overvalued today dynamic as the content, with increased Rothenberg, the IAB just took a big step and underestimated in what it means for personalization and targeting of consumer to do that, and I applaud him for it, Stuart ” the future. “The challenge of targeting interests. says. “Mobile will need to handle the is to avoid ending up with such a narrow “On one side, complexity and the rate same issues. ” audience that it becomes an inefficient of change are causing marketers and channel, Stuart says. “Most people in ” While mobile has been around for agencies so much angst, and on the media companies think targeting means more than ten years, Stuart finds other, there is so much opportunity and getting a premium, but the premium it disappointing that it does not yet excitement for those of us trying to craft seldom offsets the complications of generate $1 billion in ad support. The and capitalize on this new world, Stuart ” managing inventory, overseeing a Internet was generating revenues of $8 says. “I’m very positive we all will learn campaign, or reading results. ” billion per year five years after its birth. how to use the opportunity this transition “Mobile has got the worst sense of That said, targeting is potentially offers. It is just a matter of when. ” timing of anything I’ve ever seen. Every the industry’s future salvation, after time it got some legs (in 1999–2000 and infrastructure and other systems have 2007–2008), the economy changed, ” been developed to make it work. “But Stuart says. “They’ve announced ‘This what most people miss when they is the year for mobile’ ten years in a discuss targeting as Google’s “big idea, ” row now. The waiting is killing me. Now, is that Google’s system and economics though, smart phones might be a game really worked, Stuart says. “Against ” changer. ” millions of intent-driven opportunities, Google brought hundreds of thousands of advertisers to the table—and made it self-service. They solved both sides of ” the equation, not just better targeting. © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Networked Advertising 10 Unmeasured Is Undervalued The Media Research Perspective Daniel Monistere, Nielsen senior vice president, has more than 20 years of experience in media research. In 2001, he joined Nielsen as vice president and in that role implemented quality metrics tracking across all service offerings. Nielsen is a leader in monitoring and measuring global Internet activity using proprietary tools, syndicated services, and custom analytics. A CLEAR CURRENCy WILL EMERGE huge data-processing requirements. Being able to provide credible measurement data “With online/mobile in its infancy, people in the online/mobile industry will depend are not sure what role they will play or on developing clear protocols for standards, exactly how they’re going to monetize disclosure, and transparency: their investment, says Daniel Monistere. ” “ advertisers, agencies and media As • To determine standards, industry buyers, publishers, and the content groups will have to agree on which people who attract advertising improve metrics are relevant, which are not, their understanding of how digital media and devise a way to process those work together, they’ll figure out how to metrics. implement their core competency. ” • A system for disclosing the measure- Today, online measurement has ambiguity ment process, with ground rules, is compared with Nielsen’s television necessary. “One problem is the sheer audience measurement, which people complexity of the data. When you can quantify. Billboards used to illustrate ingest the data, you’ve got to apply “If 85 million people watch a that conundrum: To quantify ad exposure, cleaning and editing rules to filter what do you use traffic counts or plot the ad’s to keep and what to discard, says ” program on TV, your reach is 85 longitude and latitude? Today, we could Monistere. “Nielsen discloses exactly million. If 5.5 million people view where we make edits and the amount cross ad placement with tracking panel that same program online and an members via GPS. “To be correctly of cleaning in the data-ingestion piece.” increment of 1.5 million sees it valued and demand its proper share of • Transparency, whether through audi- Internet only, there’s a 4 million ad dollars, networked advertising has to ence measurement disclosures or overlap of people who watch a be measured, says Monistere. “Having ” third-party audits, is essential for letting so many metrics for quantifying what an parties review and evaluate data. program on television and stream advertiser is purchasing is holding back it online,” he says. “You can make There are attempts in the marketplace to industry growth. ” write standards to quantify ad exposure the argument that you increased The Holy Grail of online/mobile advertising and to establish certification. The Media your reach to 86.5 million.” is pinpoint targeting, he says, which has © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
11 Networked Advertising Unmeasured Is Undervalued, continued Rating Council (MRC) has developed and Cell phones are limited by the amount of The data are there for everything people do continues to refine online standards, commercial content the user will put up online, and Internet server log subscriptions disclosure, and transparency protocols. with and screen size. Sports or news works from a variety of major U.S. Internet service Many video properties with their own Web better than some other programming. providers will tell you accurately what types sites can apply to the MRC to have the way “The biggest wild card is the under-18 of people are going to what types of sites. they count hits on their site accredited. generation. Because I enjoy the feel of Measurement that follows the audit trail Web sites that want accreditation can paper, I’ll still read a newspaper, but my that people leave triggers privacy concerns. apply to an independent party to assess two boys, who are 12, are comfortable with Log services provide a level of granularity their standards, which mainly come from LCDs and don’t mind watching on a little that is close to census, which is always the Interactive Advertising Bureau (IAB). screen, says Monistere. “ ” Attitudes may very desirable, says Monistere, but they The process adds value for an applicant change as a younger group grows up with have limitations. For instance, set-top box but is not a prerequisite to doing business. the medium. ” data will reveal what programs go into the For every one that voluntarily undergoes Getting good mobile measurement data household but not to whom. this rigorous process, thousands don’t, is tricky as well. Carriers are extremely and media buyers are not assured of a Even with census data, any picture of protective of their consumer relationships, systematic counting mechanism. consumption will be incomplete. TV and any software solution means going audience research must represent people HyPE AND REALITy ON MOBILE through the carrier. Any hardware solution with all forms of carriage…those who has to be compatible with all the hardware receive their signal over the air only and Nielsen measures Internet viewing activity in use. “If we replace audience cell people who receive cable or satellite. that takes place in the home, and it has phones with ours, how do we do that in a Within the cable sector, some homes have a service that looks at Internet usage methodologically sound way?” Monistere set-top boxes, others don’t, and some have remotely. For cell phones, it is still trying to says. “Cell phone usage is part of the larger a combination of the two. Of the universe figure out an appropriate way to measure ecosystem—wherever television is, we with set-top boxes, whether cable or —on-device measurement or some other want to measure it. ” satellite, some segments don’t have DVRs, method. CENSUS: THE TRUTH IS OUT which is a driver of viewing behavior. For Internet streaming and cell phone THERE many of these groupings, census data can measurement contrast with TV in that the be harvested. commercial content is different. “Some Anonymous data helps both advertisers In the online space, consumers already can people say consumers would rather watch and consumers in ways we take for join sites by agreeing to e-mails soliciting a program online to avoid commercials, ” granted. Many things are free or are opt-in participation in different surveys. If says Monistere. “If that’s true, adding cheaper because advertising offsets the they agree to take the survey, they get 5 commercials will drive audience away. cost. “But people are sensitive to anything points; if they qualify to take the survey, And if you don’t, you can’t monetize your that is electronically census based, says ” they get 75 points. They become or remain investment. Different clients we’re working Monistere. “I don’t think anyone knows part of the panel to accumulate points in with are alarmed about siphoning away the solution to finding that balance order to redeem some type of prize or viewership to a free form. Newspapers did between getting advertisers and marketers reward. “There’s a question about how that, and they now have big problems. ” information that they want and maintaining representative that is, says Monistere. ” the level of privacy the public wants.” © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Networked Advertising 12 Unmeasured Is Undervalued, continued “But it may be a good way to supplement a counter to the industry fixation on the To assemble demographic information, randomly drawn panel.” threat the Internet poses to television, and advertisers are going to need a way to that advertisers are migrating because the quantify the people who redeem marketed Essentially, all Nielsen-run panels require 18-to-34 demographic isn’t watching TV products. Nielsen movie theater research panel member consent—people check a anymore, he says. ” helps drive the in-theater ads we see before dialogue box that says “do you agree?” or a film, for instance. To implement location- “I accept. “Any time you can engage the ” Nielsen funded a study from the Council based advertising, advertisers will need to person who is being measured, you don’t for Research Excellence, an industry client know the characteristics of mobile device have as many privacy concerns as when group. The objective of this study was to users. you’re harvesting census or server data, or quantify, through observation, people’s data sets that come back to a central area, ” exposure to different media. To see the “We’re not close to having reliable, full- Monistere says. target group’s habits, a device tracked their population census data. People see how consumer media exposure around the easy it is to exploit personal information OPTIMISTIC NUMBERS clock, including simultaneous exposure to and are very hesitant to give it, Monistere ” telephone, Internet, TV, and radio. The study says. Identity theft is a public problem today “As we move forward with various forms of found that in-home television viewing was that has increased audience resistance video on demand and Internet streaming, about 94 percent of total content exposure. to anything that invades privacy. In the marketers have got to be careful not Only about 6 percent occurred exclusively past, there was mass pushback to the to cannibalize the main audience, says ” on the cell phone, away from home, or on introduction of Social Security numbers. Monistere. The relationship between people the Internet. That ultimately changed. He speculates that who view a program on television and some form of identification, via the Internet those who stream online isn’t necessarily DESCRIBE THE AUDIENCE FOR or a personal device, could become the exclusionary, either. “If 85 million people ADVERTISERS new Social Security number. watch a program on TV, your reach is 85 million. If 5.5 million people view that We’re moving to a toolbox approach and “Is the concept of right ad, right time, right same program online and an increment will find the device that we can most place still applicable to online advertising? of 1.5 million sees it Internet only, there’s seamlessly get into, Monistere says. The Definitely. Right place and right ad will a 4 million overlap of people who watch a 2002 movie Minority Report depicted future always be in play. Online, right time program on television and stream it online, ” technology that scanned Tom Cruise’s depends on how ads are cycled. Right time he says. “You can make the argument that eyes as he entered a subway station, for does apply with television, says Monistere. ” you increased your reach to 86.5 million via example, and tailored an ad to him. To “Even factoring in DVR time shifting, more supplementing with the Internet. ” plan the movie, the producers used think than 75 percent of viewing is live plus same tanks to project the future; today, retinal day. For brand building, timing is moot, Indeed, without the ability to stream on scanning is used in some airports as part but for opening a movie, delay may make the Internet, viewers might have watched of the security screening process. “ future A a difference. With anything on demand, something else. The issue is how audience mechanism might be a thumbprint, a heat the Internet is pretty much time-shifted by behavior changes based on being able to signature, or a device, but it will facilitate nature. ” stream. If viewers have only X number of location-based advertising, especially with hours for entertainment, streaming may GPS applications on mobile phones, ” let them watch your program at a more says Monistere. convenient time. “This probably runs © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
13 Networked Advertising Listening to the Market The Advertiser Perspective Tracy Benson, head of Best Buy Interactive Marketing & Emerging Media, spoke to KPMG about her role as senior director of consumer brand digital marketing for the world’s largest specialty electronics retailer. Benson’s group is responsible for Best Buy’s digital customer brand advertising strategy; interactive marketing; and mobile, social, and emerging media product development. The roles that populate the contemporary determine influence as it relates to return advertising ecosystem are becoming better on spend for advertising, investment, or defined according to Tracy Benson. “Today, the conversion, Benson says. “It’s also ” from a marketing and communications/ challenging to understand the defining click advertising perspective, I know who is or optimal click sequences that produce responsible for online display advertising, the final action. ” search engine marketing, or video Publishers, advertisers, and agencies marketing, Benson says. “But social and ” have their own measurement systems, mobile media roles remain a challenge. ” as do third-party ad servers. “When you Also challenging is the specifications try to define where the last click came overload created by competing platforms. from, you can get duplicate data sets. “If I want to advertise across 20 So if a publisher tells me, ‘You’ve got different publishing sites and 20 different .13 percent click-through,’ but I know my placements, I have four different platforms customer searched on Google while he (mobile, social, pure Web and publishing, or she was in a tabbed browsing window or interactive TV), says Benson. “Without ” clicking through the ad, using a shopping uniform development standards, we have comparison engine in another, and to create everything unique and custom. surfing BestBuy.com in a different tab, That can increase production costs by five-, then what really drove the click versus ten-, and twenty-fold depending on the which media influenced the last click?” number of creative units and content. ” Trying to “de-duplicate” the data obscures where effectiveness comes from. Lack MEASURE OF SUCCESS? of standards and systems integration is a barrier to efficiency and media Lack of data exchange standards is accountability. another big problem. “In the online space, there’s an issue about who takes Online advertisers in general have become credit for what click, whether first, last, better at figuring out how to pull multiple or subsequent multiple clicks. If you data sources together to look at the path can’t define accountability, it’s hard to for display advertising, Benson believes. © 2010 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
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