Frequency Capping In OTT Will Open the Ad Investment Floodgates

Home » Frequency Capping In OTT Will Open the Ad Investment Floodgates

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By David de Jong, CEO of Screen6

Advertisers have long been aware of the importance of monitoring frequency when it comes to their messaging. With the rise of the digital age and the countless new ad venues that it opened, advertisers recognized the need to avoid exposure to too many ad impressions, both as means of improving the user experience and ensuring their ad buys garner the needed reach.

Enter frequency capping.

Initially, during the desktop era, frequency capping fell to the publishers that dropped cookies on visitors and ensured they were only served a finite (capped) number of impressions of a given ad.

Moving into the mobile world, the need for cross-device frequency capping between desktop and mobile became an imperative. Frequency capping responsibility moved quickly from the supply side to the demand-side platforms.

Connecting the desktop and mobile dots isn’t always simple, but it’s doable. Advertisers are increasingly employing cross-device frequency capping capabilities across their campaigns through their buying platforms.

Unfortunately, there’s nothing straightforward about cross-device frequency capping in the OTT and connected TV era. These days, more than 50% of U.S. households use some sort of OTT video services, and 89% of OTT viewing takes place on TV sets. With the shift from linear TV to digital video, the TV now represents another digital device to factor into the cross-device equation, but the underlying plumbing is complicated and unique.

From a viewer perspective, watching TV is still watching TV, whether it’s linear or OTT. Whether tuning into live sports on a network or queuing up their favorite shows on Hulu via a streaming media player, viewers are kicking back to watch TV and unlikely to give much thought to the delivery system behind their experience.

On the advertising side, it’s an entirely different story.

If an advertiser like P&G rolls out a new TV ad, it might purchase OTT inventory on both CNN and Hulu. To reach the viewer, those ads will travel through entirely different pipes—ones that are not aware of one another, or any other channels for that matter—to arrive on the viewer’s TV screen.

While rudimentary frequency caps can be applied at the level of the CNN buy and the level of the Hulu buy, those two delivery systems do not communicate with one another. The result? P&G has no way to measure reach correctly, nor can it accurately apply a frequency cap across its buy. Viewers will be overexposed, campaign optimization will be nearly impossible, and media dollars will be wasted.

Advertisers Demand a Better Audience Understanding

As larger portions of linear TV budgets shift to digital OTT, advertisers expect the same level of control and accountability that they’ve enjoyed on desktop and mobile to accompany this new channel. This is doubly the case, given the high CPMs that characterize the TV buying world.

As advertisers increasingly recognize the complexity of this environment, they will demand a solution to the frequency capping conundrum and its associated wasted impressions. If the industry does not deliver one, investment in OTT advertising will fail to reflect the massive shifts in audiences to these environments.

The solution won’t be simple.

Monitoring frequency in digital and mobile often relies on a unique identifier, such as a cookie or mobile device ID. The OTT environment has multiple IDs per device, both device vendor and individual publisher IDs. Even if a universal ID connecting multiple OTT publishers existed, those IDs still wouldn’t represent individuals.

After all, TVs and OTT subscriptions are much more likely to be shared than mobile devices. That means true OTT frequency capping according to an individual would still remain elusive.

Solving the formidable challenge of frequency capping within OTT will require unique solutions and, above all, industry collaboration. The size of the OTT ad opportunity is one that warrants cooperation rather than no-holds-barred competition. With cooperation, all parties stand to benefit. Without cooperation, none shall.