The accelerated adoption of over-the-top and streaming services has transformed people’s consumption habits, breaking down barriers between content and accessibility. For brands, it means a seemingly infinite number of audiences with whom to build relevance, impact, and incremental reach.
However, unlocking this potential requires an entirely different approach to traditional television buying, and this is where addressable TV is a game-changer.
Addressable advertising on TV platforms is the ability to show different ads to different households while they watch the same professionally produced TV content across on-demand, live streamed and linear viewing environments. Now mainstream in the United States and Europe, addressable advertising is poised to shake up Southeast Asia as media habits undergo a dramatic shift.
Television is predicted to continue to grow between 1% and 3% over the next five years as connected TV grows in double digits, offsetting reductions in linear TV in regions such as much of Western Europe, the United States, China, Malaysia, Taiwan, Singapore, and the majority of Latin America.
APAC has the fastest growth rate of subscription video on demand (SVoD) in the world, which is projected to grow at a rate of 40 percent until 2026. At the same time, connected or smart TV is showing incredible promise both against TV and the broader advertising sector. The reason: linear television no longer fills the living rooms. Instead, Southeast Asians are streaming millions of minutes of OTT content via platforms like Netflix, Viu, and iQIYI.
Utilizing data to power TV planning
Addressable TV primarily draws in advertisers who want the best of all worlds; premium broadcast quality content, digital precision targeting, and a brand-safe environment.
Where addressable TV really sits apart from traditional linear TV is the opportunity for advertisers to explore unique data sets to enrich their audience targeting strategies. Building out bespoke segments can allow for more focused targeting which is then activated down to postcode level locations.
Both attributes and behaviours of audiences are combined to build up a profile of households across a geographical footprint, allowing more precision in campaign strategy, activation, and execution.
This data not only allows for more personalized and targeted advertising but also for more relevant creative content. For example, a campaign for an electric car may show one segment of an ad focused on a family model, while another sees one featuring a sports car. Ideally, each neighbourhood also sees different details on the dealership within the relevant regions.
The power of the big screen
Most importantly, TV ads have an emotional power that cannot be matched by short, user-generated video or social media formats. According to the GroupM Consumer Eye report, TV ads continue to be the medium that delivers the most positive impression of brands, alongside recommendations from friends. That’s because TV ads have the space to tell a story, either in a single creative or sequentially over time.
“Where addressable TV really sits apart from traditional linear TV is the opportunity for advertisers to explore unique data sets to enrich their audience targeting strategies.”
Bridging that creative power with household targeting has a powerful appeal for advertisers. And, last but not least, there’s less of a risk of unsuitable or inappropriate adverts appearing between programs.
A critical opportunity
SEA is one of the fastest digitising markets in the world. According to the report, the region’s digital economy is still on track to surpass $1 trillion by 2030. Countries such as Indonesia, Malaysia, and the Philippines have some of the highest numbers of smartphone owners who stream on their devices, contributing to the 70 per cent of people in APAC who stream content online.
Cord-cutting, whereby audiences cancel traditional cable or satellite service, is relatively mature in Hong Kong, Singapore, and Thailand, while Indonesia has just turned off analog altogether.
Advertisers and agencies are increasingly becoming aware of these divergences in SEA’s media consumption and are, therefore, starting to understand the role that addressable TV plays in a marketing strategy.
Considerations for Marketers
For marketers looking to invest further in addressable TV, there are several key trends to look out for. One is the diversification of non-linear TV viewing. Netflix recently unveiled its new advertising model for subscribers looking to pay lower premiums. And while SVOD remains the dominant choice in the OTT space, marketers have a critical opportunity as a new advertising video-on-demand (AVOD) model emerges.
“There is no one-size-fits-all approach to addressable TV. Instead, strategies work best when brands have a thorough understanding of their audience. Given that SEA has 655 million people and more than 1000 different languages, this is not easy.”
Other key trends in SEA include the popularity of video gaming and eSport, which form the bulk of many consumers’ entertainment diets. QR codes have also seen a resurgence since the COVID-19 pandemic, which opens the door for brands to continue the conversation with people after they have seen their TV or online ad.
Last but not least, TV must act in concert with omnichannel solutions. TV is still the most trusted medium, and it has proven to be able to cut through the digital noise, but advertisers must be able to keep up with viewers to provide a multichannel brand experience.
There is no one-size-fits-all approach to addressable TV. Instead, strategies work best when brands have a thorough understanding of their audience. Given that SEA has 655 million people and more than 1000 different languages, this is not easy, but it makes a significant difference. Even the most basic modifications to a nationwide ad can increase its impact on regional segments.
Marketers must always be mindful that TV advertising will continue to evolve. They must always strive to find creative ways to communicate with their target audience while ensuring it is fit for a premium brand-building experience. By constantly testing and learning from different audience reactions, marketers can join them in celebrating successes regardless of the time, place, or platform.
Featured image via Cottonbro Studio.