Research highlights Addressable TV ad potential
January 18, 2024
RTL AdAlliance, the international sales house of RTL Group, has published the findings of research into SMEs and their attitude towards Addressable TV advertising (ATV), suggesting they are particularly relevant to sales houses and agencies that broker ATV to small and medium-sized enterprises.
The results show how mid-sized companies in Germany engage with ATV advertising, what potential the format offers, which challenges SMEs should account for when entering TV advertising, and what tools and solutions RTL AdAlliance can offer.
ATV removes the hurdles for small and medium-sized enterprises to enter the world of TV advertising. SMEs often operate in niche sectors or offer their products and services only in limited areas. Thus, traditional TV advertising has been financially unattainable for many SMEs so far. The difficulty derives from reaching overly broad or unspecific audiences, because of a many-to-many targeting approach. The survey reveals the amount of unexploited potential that the SME business holds for ATV.
So far, only 9 per cent out of the respondents interviewed name TV as one of their preferred advertising channels. 5 per cent chose traditional linear TV advertising, while 4 per cent were already well aware of the benefits of ATV and used it as their medium. ATV helps SMEs reach – in moderate volumes – the growing number of consumers who watch TV via internet-enabled smart TVs with targeted ads.
Although advertising for SMEs has recently become increasingly digital, many are not yet aware of the benefits that digital advertising formats for linear TV broadcasting can bring. A large portion of German mid-sized companies (57 per cent) use social media for advertising purposes. Not because of their belief that these platforms are the most effective for their advertising efforts, but because they find the provided buying tools to be the easiest to use and the most affordable. Fifty-nine per cent choose the channels they advertise on mainly because they are easy to access, and 48 per cent because they are particularly cost-effective. More than half of the respondents (54 per cent) indicated that they have never heard of ATV, 36 per cent were aware of the term but only 10 per cent knew what ATV and its advantages were: simple usage and great value for price.
The SMEs who have already advertised with Addressable TV are convinced by the format. 73 per cent of companies that have already made use of ATV state that they will continue to use targeted advertising in a premium environment. 30 per cent of those who use ATV for their campaigns do so because they want to be able to display targeted ads in a high-quality environment. This is closely followed by the fact that they view television as a prestige medium (25 per cent) and see it having a high impact on branding and advertising (22 per cent each).
The reasons for a low preference for ATV vary but can largely be brought back to misconceptions. The perceived barriers among those who do not consider using ATV range from believing it to be too expensive (22 per cent), to a lack of interest (17 per cent), or for it to be seen as too complex (4 per cent).The research addresses these misconceptions. With low minimum booking volumes, simple access, scalable tools and automated campaigns, ATV advertising is much more affordable and less complex for SMEs than traditional TV advertising and many other digital formats. According to the New Life of the Living Room study, conducted by RTL AdAlliance, 73 per cent of Europeans own a smart TV. ATV advertising offers SMEs the chance to reach targeted customers daily.
“SMEs make up 99 per cent of businesses in Europe,” notes Fabian Burgey, Director SME Business Europe. “Their strength lies in their geographical proximity to their customers, and ATV gives SMEs the opportunity to increase their awareness locally and become even more present within their communities. When SMEs choose to advertise via ATV to reach their very specific target groups, it is not only them, but also the broadcasters and sales houses that benefit. With our tools, RTL AdAlliance can offer suitable and scalable products to link broadcasters and SMEs. In this white paper we show how our self-booking tool lowers the entry-barrier for SMEs into TV advertising and introduce a completely new solution for decentralised Point of Sale (PoS) marketing for franchise systems and retailers.”
SMEs who did advertise on TV mention the high-quality, uncomplicated booking, and brand-safe environments among the positive effects. This is illustrated by use cases of coating technology company KBN Beschichtungstechnik (Knorrwerbung) and Marvin Eichele Roofing (Heise RegioConcept), and interviews with Sport1 and Axel Springer Regionalvermarktung. SMEs can reach relevant customer groups directly, flexibly and with low financial investments. This enables SMEs to display their ads in the same premium TV environment as larger brands with more resources and budgets. ATV’s accurate real-time targeting ensures that ads are only shown to viewers within the targeting criteria, limiting the ad deliveries to non-relevant consumers.