Adtech Creativity Brand Strategy

Ad industry grapples with complexity & fragmentation of addressable media

By Jon Watts and Ian Maude | Executive Directors

The Project X Institute

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June 15, 2022 | 8 min read

The European Addressable Media Initiative is exploring the emerging ecosystem in Europe’s major advertising markets – and is finding advertisers, agencies and media owners grappling with complexity and fragmentation.

The European Addressable Media Initiative, the cross-industry program focused on helping European ad buyers and sellers navigate the addressable media landscape, has completed a key stage of its research program, investigating emerging challenges and opportunities.

Working closely with the Initiative members – Finecast, LiveRamp, Amobee, Comscore, Lotame, Magnite, Neustar, OneTrust and PubMatic – we have completed a series of in-depth interviews and roundtable discussions with leading participants in Europe’s five largest advertising markets – the UK, France, Germany, Italy and Spain.

Advertisers, agencies and media owners alike have to navigate a complex range of solutions,

Cross-media addressability and measurement add further complexity to an ecosystem in transition

These discussions have provided a compelling snapshot of an industry in transition.

Click here to register for future seminars.

As has been widely reported, there is concern about the future, with privacy regulations, anti-tracking safeguards, and deprecation of established digital identifiers contributing to a more challenging environment for addressable media, especially across the open web.

However, neither advertisers nor media owners are despairing, with many of those we interviewed highlighting the time available to prepare for a cookieless world, the progress that has been made already and the innovative new solutions coming to market.

Agencies are helping clients navigate a growing range of options for delivering marketing messages to addressable audiences, including contextual targeting, seller-defined audiences, cookieless ID solutions, clean rooms, data-matching and other techniques.

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Media owners also have an array of options, with a wide selection of tools, solutions and partners helping them deliver addressable campaigns. Audience scale, access to first-party data, data quality and data matching capabilities are critical factors, but new networks, alliances and collaborative solutions are emerging for smaller publishers.

Many industry participants stated that data and privacy regulation remain a key area of uncertainty, with proposed laws including the EU’s Digital Governance Act, Digital Services Act Digital Markets Act and Data Act, as well as proposals for artifical intelligence, cybersecurity and further privacy regulations, making long term decisions harder.

Some of those we interviewed cited the recent ruling by the Belgian Data Protection Authority that IAB Europe’s Transparency & Consent Framework (TCF) violates General Data Protection Regulation (GDPR) as further evidence for this. Others suggested that policymakers and regulators are far from finished with the advertising market, creating further uncertainty.

Finding a point of difference

Advertisers, agencies and media owners alike have to navigate a complex range of solutions, and many are finding it difficult to determine how best to proceed. For smaller players, often with small teams, evaluating different solutions and suppliers is time-consuming and resource-intensive, and there is a risk of committing to a solution that is not ultimately supported by the wider market.

As one UK publisher said, “It’s hard to pick the right solution, with confidence, in the current market – and even harder to really understand the material differences between vendors.” Some publishers expressed concern about losing business if their chosen solutions do not deliver exactly what the advertiser or agency is looking for.

Donatas Nemura, senior director, product solutions at Finecast, WPP’s specialist addressable media agency, sees similar challenges in addressable TV: “We’re seeing a wave of experimentation and further fragmentation in identity resolution approaches to addressable TV. There are a range of different identity solutions and frameworks being developed and tested today, while publishers also seem to be taking slightly different paths when it comes to the partners they work with and the depth and types of data they share. It is very likely to be a few years before we have a handful of large-scale competitive solutions – and industry-wide collaboration is crucial if we want to get there faster.”

Making the right choice

Increasing complexity is also an issue on the buy side, with a senior executive from one leading agency group commenting, “We’re seeing an explosion of media-owner controlled clean rooms to house data, conduct analytics and report on measurement – but we want to work with our own choice of clean room, using privacy-safe ways to get data in, rather than having to work across multiple media-owner solutions, which makes it harder to manage frequency and evaluate performance across different partners.”

Several agencies also highlighted the difficulty of delivering large-scale and reproducible campaigns. As one agency executive explained, “We have a range of options for our clients, but it’s not always easy to determine which solution is optimal – scalable, effective and repeatable – without extensive testing and learning.”

One solution, adopted by a growing number of agencies, is buy-side curation. As Piper Heitzler, head of growth, EMEA, at Amobee, says: “Agencies have many strengths, but one longstanding value driver has been their ability to leverage their buying power to secure premium inventory. As a technology vendor enabling the planning and activation of these commitments, we’re seeing every agency group double down on marketplace strategies – particularly for innovative video advertising experiences. Discovering and activating private marketplaces hasn’t historically been particularly sexy nor efficient. Building a unified gateway of curated inventory delivers the innovation, organizational benefits, and elevated experience the programmatic traders of tomorrow will expect.”

Cross-media measurement

The need for cross-media addressability and measurement add further complexity. Identity resolution and measurement solutions developed for digital may work on connected TV platforms but may not do so across multiple walled gardens controlled by different pay-TV platform operators, telcos and streaming media companies. Advertisers also face the challenge of navigating between households, devices and people.

Will Keggin, director of advanced advertising, UK, at LiveRamp, is positive that these challenges can be solved: “The demand for cross-media addressability is driven by evidence that people-based marketing works. Advertisers have experienced this through existing platforms that provide the ability to plan, activate and measure within an end-to-end people-based ecosystem, such as social networks or tech platforms. Technologies already exist to help advertisers, media owners and technology partners to collaborate on the consumer touchpoints that could be utilized for cross media addressability across a greater proportion of media investment.”

According to Paul Goode, senior vice-president of strategic partnerships at Comscore, there has been significant progress towards cross media measurement: “As new identity schema are created, whether intra- or inter-company, the measurement challenges remain the same: how to resolve digital IDs to real people, how to assign correct demographics, and how to account for overlaps, whether between media properties, between PC and mobile platforms, and between digital and TV. This requires the creation of an underlying measurement space of synthetic persons that is equal in size and representation to the population, and a methodology, based on panels as a source of truth, for probabilistically mapping the various ID schema onto this measurement space.”

We will discuss all these challenges and potential solutions at a series of town-hall events which are open to all executives working on the buy and sell sides of the advertising market – advertisers, agencies, publishers and broadcasters – in the UK, Germany, France, Italy and Spain between July 6 and July 14 2022.

Click here to register and attend any of these seminars. We look forward to seeing you there.

Adtech Creativity Brand Strategy

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