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State of the Screens

‘To sell more TVs, we need to have better TV content’: Why Vizio is trying to standardize addressable TV advertising

By July 31, 2019No Comments

The big shift: Smart TV manufacturers such as Vizio and Samsung are creating ad-supported streaming channels in their OS to compete with Roku and Amazon.

Share of U.S. TV households with a smart TV according to Nielsen:
2018 – 39%
2019 – 47%

The goal for Smart TV manufacturers: The profit margin on a smart-TV is roughly 6% (ex: $30 of profit on a $500 smart TV) which is leading the manufacturers toward other revenue streams such as addressable advertising.

The benefit for consumers: Cheaper smart TVs and more free video content that is supported through advertising.

The benefit for advertisers: More addressable advertising inventory to reach consumers.

Quote from William Wang – CEO @ Vizio:
“For us to sell more TVs, we need to have better TV content. We need to have more free content,”

TV content + digital attribution: Addressable advertising through a smart TV is able to provide digital like attribution (purchases, store visits, etc.) through a technology called ACR.

What is ACR? Automatic Content Recognition (ACR) is a technology that identifies the content that is playing (TV show, etc.) based on what it hears. It is alternative to collecting viewership through panels (Nielsen, etc.) and/or set-top box data (ComScore, etc.).

The players in ACR:
Nielsen Gracenote
2) Inscape
3) Samsung Ads
4) Roku
5) Alphonso
6) Samba TV

Advertiser plans for advanced TV over the next 12 months according to the IAB:
Increase – 59%
Stay the Same – 38%
Decrease – 3%

Podcast: How We Get To Better Measurement

More #1: Waiting For Addressable: Why It’s Taking So Long For The Industry To Get Its Act Together

More #2: Paul Haddad Explains How a4 Is Inventing the Way Advertising Works

Michael Beach

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.

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