At our BIA/Kelsey LOCAL IMPACT: New York last week at IAB’s Ad Lab, we convened a discussion group with participants across various media channels and organizations on the topic of digital buying and selling. Our goal was framing four key pillars that impact local digital adoption across stakeholders in the community and following up with participants to share their own experiences and outlook/challenges.
The session was interactive and dynamic. Although no firm solutions were formed from the discussion, it is clear that local digital cannot advance without improving data and tech stacks that originate locally.
However, the decentralized nature of the industry makes it difficult for a single media owner or channel sector to carry on its own. It will require collaboration and support across the competitive spectrum and can be achieved by framing a solution that centers on local markets and their individual characteristics.
Despite the suggestion that automation and data driven buying may enable vendors to sell directly to advertisers versus being dependent on agencies, it was acknowledged that this will not change overnight or be possible without better alliances in building out more representative data and tech stacks for local. Optimistically, this reveals a huge opportunity to develop more open APIs and collaborative funding for the benefits of the industry.
Here are some of the specific discussion points that emerged in the examination of four key pillars.
Pillar #1: Moving from Scheduled Content to Streamed Content-on-Demand: The market is shifting from an environment dictated by program schedule to one that is more broadly streamed on-demand. With this shift, there is now less control by the programmers, more choice by the consumer, and a content environment with minimal standardization.
- Participants concurred that as digital inventory expands and technology permits more opportunity to target inventory, it brings a new set of challenges.
- Many in the traditional sell side feel limited as the majority of their inventory is still bought and sold through traditional measurement terms that are outdated and insufficient to compete against digital options.
- While they have digital options for advertisers to purchase, they are often selling to different buyers with different standards.
- Monetization is also a challenge due to concentration on low CPMs across all digital channels.
Pillar #2: Market Personas: As data now enables the creation of audience personas to lead advertising and currency decisions, it is difficult for local content to differentiate its value versus a national rollup. One way to demonstrate the value of these audiences is to introduce the development of market personas that include data markers that distinguish metro/markets in order to match audiences to this data for better context.
- The group shared concern that the value of individual markets and how each have a different story to tell is often lost against the digital buying community and to a similar extent the overall buying community.
- Most agreed that forming a central repository for market data and collection is a good solution versus having individual channels or media owners and agencies formulate their own data collection.
- The challenge is finding a source that is open and collaborative and affordable for the entire ecosystem to participate and use.
Pillar #3: Data Anchors : One of the biggest challenges facing local digital buyers and sellers is the decentralized nature of data collection, attribution and insufficient modeling solutions. Large data collections are often aggregated nationally and then used as surrogates for local markets or incorrectly modified to a geo frame. This hinders the ability to properly evaluate markets or audiences and prevents wide scale usage due to frustration and confusion. At the local level, there is a critical need and strong opportunity to develop a common tech stack that utilizes local data with similar framework across each market. Data markers that originate locally should at minimum identify market and audience characteristics but may need to be modified pending the size and availability of data in each market. Following standard collection and attribution patterns is also critical to diffuse confusion and improve confidence across both buyers and sellers.
- Similar to the market persona discussion, the group had concern that data attribution against local content appears to be too one dimensional and minimizes the quality of relevance to local audiences.
- Many argued that the focus on “an impression is an impression” could further dilute the ability to defend content success in one market versus another as the audiences that live in individual markets are often different from national averages.
- There is concern that media sellers and their owners are at a disadvantage because agencies seem to dictate terms.
- Although there is an opportunity for the selling community to develop better data anchors and be less dependent on what individual buying agencies may require, it is risky from their point of view without a strong blueprint and willingness to follow through.
Pillar #4: Strategy versus Tactics: Data driven buying and the rise of digital channels has become very tactical in recent years as automation and cost efficiency lead most directives. The emphasis on tactics has hindered the ability for sellers and buyers at the local level to align and defend content and channel support that may better align with an advertisers marketing strategy; but is often overlooked if it falls outside the narrow tactical goals of a CPM or audience metric. Local strategy seems to be lacking with larger aggregation models used by marketers and puts local digital providers and buyers at a disadvantage.
- There was strong agreement that the focus on strategy is often absent between buyer and seller.
- As more data driven buys rely on delivering specific audience CPMs and/or broad impressions, there is little differentiation or ability for content distinction.
- This erosion has limited advertisers’ ability to participate in more effective placement or expanded programs without consideration of how the local program might fulfill strategic needs.
- This emphasis on tactics hurts the local marketing effort in two ways by hindering budget allocations to local markets and overlooking content and channel relationships that may provide better local relevance.
- Facebook and Google are benefiting from locally targeted ad budgets and the majority of sellers understand that they have better CPMs that limit their ability to compete.
- However, all feel that better programs with stronger local integration is a benefit that local media channels can provide due to their deeper relationships with the community they serve as well as their broader content and talent affiliations.
BIA/Kelsey’s next LOCAL IMPACT event will be October 12th in Atlanta.