Deterministic data from set-top boxes is changing how linear TV is bought and valued.
Like the Nielsen ratings panel, set-top box data connects to a physical address and household. But unlike Nielsen’s 40,000 families – which provide a "truth set" for TV viewership – set-top boxes reach millions of households, allowing marketers to overlay purchase and CRM data to create targets.
Many multichannel video programming distributors (MVPDs) license set-top box data to comScore, Nielsen (which signed a deal with Dish in April) and ad tech companies like Simulmedia. These entities then aggregate and sell that data to TV networks and agencies.
“You will not find a TV network, a research company or a big piece of ad tech that is not trying to race forward to [incorporate new] data sets,” said Andy Fisher, chief analytics officer at Merkle.
One way is by using set-top box data to supplement Nielsen panel data. Marketers can target beyond age and gender. “We are moving into a demos-plus world,” said Mark Zagorski, Nielsen Marketing Cloud’s EVP.
Set-top box data ties to specific households, which means that marketers, through a data match, can understand the buying tendencies of those households. Then they can buy ads on the shows that the best prospects watch most.
Because they are still buying the entire show’s viewership, this is termed index-based buying. In contrast, with addressable TV, marketers only buy the audiences they want to reach.
“The main leap the industry is moving toward today is from demographic buying to index buying,” said Samba TV CEO Ashwin Navin.
TV networks like Viacom, Turner and NBC Universal are building systems that allow marketers to do index-based buying.
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