How British Telecom Sky Blueprints Video Investments

skySky Media, the advertising sales arm for British telecom and broadcaster Sky, sits at the crossroads of technology and strategic investment.

A new partnership with multiscreen ad-delivery tool Yospace, unveiled last Wednesday, will support dynamic ad insertions in linear streams like sports, news and entertainment on both IP and OTT devices alongside Sky’s ad server, FreeWheel.

“It enables us to monetize millions of streams that previously we weren’t able to,” said Jamie West, deputy managing director of Sky Media.

While this partnership won’t impact all of Sky’s 10 million-plus registered customers, it will impact the several million that use Sky Go, a TV Anywhere service.

Recent Sky investments in demand-side platform DataXu, as well as a programmatic TV project with Videology, are also beginning to bear fruit.

Sky Media reaches on average 50 million people in the United Kingdom weekly across its portfolio of channels. On the addressable TV side, platforms like Sky AdSmart let advertisers target one out of four UK households using household addressable attributes.

West spoke with AdExchanger about Sky’s dynamic ad-serving developments, investment interests and the latest on the build-out of its sell-side platform.

AdExchanger: What does dynamic ad insertion do for the advertiser?

JAMIE WEST: It allows us to ad serve/decision in the moment, rather than pre-fetching ads and stitching them into live and linear streams. It gives us a lot more optionality. 

Has server-side stitching been effective for UK publishers to fight ad blocking?

I think IAB numbers in the UK show an increase in 15% to 18% of consumers who had an ad blocker. For Sky, most of the streaming video services are in-app, so the implications of ad-blocking software are slightly different than on the browser.

One thing we noticed when we put out a study on addressable advertising both on video on demand and in linear TV – we found that when we served a targeted or addressable ad, channel switching or flipping reduced by 32%. It’s our supposition that where we serve more targeted, more engaged advertising, we have more engaged audiences. The experience is that much better in a targeted environment than in a catch-all environment.

Who are the latest adopters of addressable TV?

Of the advertisers active on Sky AdSmart, 73% are new to Sky and 31% are brand new to TV. That’s enabling us to engage with advertisers ranging from local car dealerships and local legal practices for niche targeting based on locality, to the other end of the spectrum, which would be niche targeting in terms of audience. In April, for the first time ever, McLaren Automotive will be on TV. BlackRock has been active on the platform. Software as a service like SAP looked to reach senior decision-makers and C-suite executives. Who would have thought two or three years ago that brands like that would be using TV for the first time?

What’s driving this shift from “nonendemic” advertisers?

It’s that unique brand-building power of TV that can cut through in a really complex media ecosystem, overlaid with this ability to bring to bear a really granular reporting and understanding through addressability.

How have your TV segments grown, given Sky has had an addressable TV product in-market since 2014?

We’ve grown that from 90 fixed attributes to well over 900 custom segments. We built out our data partnerships, from Experian to dunnhumby to MasterCard. We’ve been listening to what specific advertisers have been asking for. Whether it be those people who were in-market for car insurance or a new car or whether it be people who are regular holiday-goers, we go through a process of testing the match rates of their data sets with our customer base to see how accurate they are and then we sample and trial them to see if they’re effective for advertisers on a larger scale. Experian is a huge partner for us in data segments.

Sky Media has worked a ton with US video companies, like Videology. What have you built?

We’re licensing Videology’s technology to customize and architect on top of that to build our own Sky mediation layer or sell-side platform. That allows us to surface our own first-party data to enhance the ad serve and ad buy but without giving up any of that data that exists through the mediation layer – be it a DMP or a trading desk. [Using Videology with FreeWheel] allows us to ensure an ad serve in a linear stream that complies with broadcast regulation, so that we take into account time restrictions or we don’t serve a lot of high-fat or sugar ads, for example, to children. We also protect the viewer experience by ensuring we’re not serving three car ads in the same break or the same ad in five consecutive breaks.

How has your investment in DataXu panned out?

DataXu is a key technology enabler for one of the products we launched last autumn called SkyAdvance, which [enables digital-like targeting] in TV. Because our multiple touch points with consumers extend beyond TV and into the digital space, whether that’s accessing content on SkyGo or on the SkySports or SkyNews app, we have a real understanding of customer journeys across the different platforms. DataXu’s role in that technology stack is not just to serve those ads on the Sky owned-and-operated platforms, but to serve those ads off-platform into the open market or through private marketplaces. There’s also a significant amount of learning we can glean from DataXu’s experience as a DSP in programmatic or addressable TV.

What fuels your investment strategy?

Sky cannot build everything itself, so we’re building really strong strategic partnerships with innovative brands as a way to build out our learning and capability. Our point of view has not been as much investing for strategic stakes, but to build meaningful strategic partnerships. We’ve also invested significantly into Roku, which is our partner on our pay TV service, NOW TV. In many ways, these investments allow us to take a major step forward into understanding the technology, which enhances our learning in other sectors.

 

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