Advertisers on streaming and connected TV can access a slew of user data to improve their campaigns, but they must be mindful of consumer privacy while ensuring they can effectively target users.
Reed Barker, head of advertising at Philo, sat down with Fierce Video to discuss the service’s approach to advertising and the challenges that lie with consumer data and CTV.
“Being able to buy that same audience on Philo as well as other CTV apps, whether it be Max, Discovery+, Hulu or Pluto, we want to make sure the advertisers can get access to that demand and look into an apples-to-apples comparison about the audience they’re trying to buy,” he said. Essentially, Philo is helping brands understand the frequency of that buy across multiple publishers.
Barker, along with several other streaming advertising executives, will delve more into how brands can use data to better target CTV audiences during sessions at the StreamTV Show taking place in Denver next month June 12-14.
According to Barker, data-driven advertising consists of two key components. The first refers to the context of what the viewer is watching. If an advertiser doesn’t want a spot in say, a TV-MA program or a horror movie, “we’re able to provide that brand-safe environment for them to place their advertisement.”
And of course, brands may want to target audiences that watch programming relevant to the product they’re selling. Advertisers selling home improvement products, for instance, will likely target home improvement or lifestyle channels.
The other component centers around identity. Barker said Philo is experimenting with privacy-compliant universal IDs, which are single identifiers assigned to users in the digital ecosystem.
He explained algorithms can create a universal ID from an email address or some other identifier, like a phone number, and that ID is then transmitted across various publishers.
“It helps advertisers understand someone who’s watching on Philo versus someone watching on Hulu…they don’t know it’s the same person but they know they can check off, ‘this ad was seen by Person X how many times across the board,” Barker said.
Separately, brands can create IDs from their pool of first-party data. But the IDs from those companies and platforms like Philo “would never touch,” ensuring the consumer data is protected.
“Our customer information is never mingled with anyone else’s information, which keeps it privacy-compliant and protects everybody in the mix,” he said. “And if someone opts out, then we never match their data.”
Notable vendors that have created universal ID technology include LiveRamp and The Trade Desk, which has an open-source identity framework used by companies like AMC Networks, Comscore, Fubo, Tubi and Xandr.
Approach to ads
Because Philo is a virtual MVPD, its ad breaks must follow the same structure as linear TV. Barker explained those ads are a mixture of 30- and 60-second ad spots that are in pods ranging from two to four minutes, depending on the network.
“We don’t get to dictate what happens [on linear], because they’re running on a broadcast clock,” he said. “So we can’t take a break that’s three minutes long and say, ‘let me make it one minute’ because there’s the future there.”
Although Philo can’t change the timing of those ads, Barker said the company prides itself on "building everything that makes sense for us to build.”
For instance, it’s built its own technology for server-side ad insertion, transcoding as well as something called a manifest generator, which he explained “creates the playlist of programming and ads, so how that all is stitched and streamed down to the consumer.”
“We’ve also built all our client-side apps…where you send beacons which basically tell you if an ad ran,” said Barker. “If you didn’t send a beacon, it’d be like a forest falling in a tree with no one to hear it.”
He described Philo’s ad insertion method as “switching between faucets ‘hot’ and ‘cold,’” but in a way viewers don’t notice any changes as they watch a stream on their device.
“It also fits into our whole philosophy of ads and programming are part of the same experience,” said Barker. “The way we build the manifest, the playlist, whatever you want to call it…it’s a seamless stream.”
Industry challenges
As for the challenges advertisers face on streaming services, he said one is how to really understand which viewers they are targeting. Especially since CTV is a combination of the experience of linear TV with the targeting of digital video.
Some advertisers, Barker noted, have the mindset that they’re targeting one individual, rather than individuals in a household.
“You have a good chance at knowing the person who registered for the app and is the main person watching there,” he said. “But you also need to understand, while I signed up for Philo, my wife may be watching without me. So you need additional contextual signals to know, ‘this is a program that skews more to women 18-34 than it does [to] men.’”
Conversely, advertisers coming from linear TV need to understand that they’re not trying to “reach 20 million homes at once,” but that they want to obtain their desired audience “an impression at a time.”
Another challenge for the advertising industry, Barker added, is to ensure publishers and brands adapt new technical standards in the same way.
“Making sure that the standards are meeting the needs of the advertisers as well as the publishers,” he said. “That we’re able to make ad calls that are both efficient in terms of timing, also rich enough to get good advertising back, and then all those metrics, there are so many moving parts.”
The ad tech industry this year has called for a more standardized advertising approach. IAB has doubled down on privacy and cross-platform measurement standards, whereas OpenAP and several major programmers formed the Joint Industry Committee, which is striving to create a unified measurement certification process.