Broadcasters in Europe may be showing a more collective front against tech companies. But thanks to a fragmented market, and with the vast majority of viewing still taking place on TV, the heat is moderate.

In France, 85 percent of viewing is linear and just 4 percent is video-on-demand, according to broadcaster M6 Publicité. But as more younger viewers move online and to platforms, broadcasters are teaming up to protect digital revenues eroding.

France typically has some success with alliances, but a broadcaster rival to Netflix, Salto, still took five years to come to light, said Kim Younes, marketing and innovation director, M6 Publicité. Salto still hasn’t yet had clearance from the markets authority. Sygma also launched this year with a number of French media companies to collect data on audiences offering an alternative to digital platforms with huge reach. “We want to create a more secure data management platform,” said Younes. “This is becoming even more relevant because of competition.”

Broadcasters tout their own viewable, brand safe and fraud-free environments while making the case for a more level playing field. But convincing advertisers to move money is hard. The trend of moving budgets out of Facebook and into addressable formats has been gaining pace.

Scaling alliances or creating combined sales houses across markets also is difficult. International video marketplace, RTL AdConnect, launched in 2017 combining inventory from video-on-demand from broadcasters with inventory from YouTube too. According to Stéphane Coruble CEO, RTL AdConnect, there’s an appetite from brands.

But there are cases where tech is being used in multiple regions. In Germany, 23 million households are Hybrid broadcast broadband TV-enabled. HBBTV acts as a browser on top of the TV where different commercials and content can be shown. Spain and France have a much lower adoption of HBBTV, said Coruble. In the U.K. Freeview is developing tech in this area too.

“Addressability and targeting is the grail all advertisers are looking for,” he added.

Brands are also waking up to the OTT opportunity, particularly direct-to-consumer brands that can target more granularly. Carat buckets linear TV and video-on-demand and is seeing around 40 percent of client spend is on cross-platform. “Clients are understanding they can get incremental reach,” said Aurelia Noel, global digital partner, Carat.

But there’s still a way to go for the European OTT market to contribute the global revenues of $120 billion (£159 billion) by 2022.

“Converting the previous broadcast inventory to the new OTT world — it’s commercial, technical and strategic — it needs to be respectful and do it at the right pace,” said Dave Castell, general manager EMEA, inventory and partnerships, at The Trade Desk.

Three questions with Stephane Coruble, managing director for RTL AdConnect:

What needs to happen in Europe for addressable TV budgets to scale?
Broadcasters will have to strike alliances between themselves if they want to scale addressable TV. It’s already happening around the distribution part of the model with BBC and ITV coming together for Britbox. Advertising, however, is trickier to make happen. We’re combining VOD of all the broadcasters we work within a private programmatic marketplace, which will also include YouTube inventory from Freemantle as well as video produced by influencers. We’re also combining online video owned by our broadcasters in Germany, Austria and Spain using the technology-standard HbbTV. If broadcasters want to compete with Google, Amazon, Facebook and Apple then they will need to offer scale. They won’t be able to grow addressable advertising on their own because at the moment it’s very fragmented and that’s harder for advertisers to access.

What about WPP’s addressable TV marketplace Finecast?
Finecast is a promising combination of the things the market needs to do to scale addressable TV but its a product owned by an agency. I’d rather the proposition came from the publishers.

Is addressable TV allowing broadcasters to take budget away from online media owners?
Part of the money coming into addressable TV is from traditional TV but the other part is coming from SEO and SEM budgets. More of this online budget could flow back into TV thanks to addressable. It’s also coming from social networks like Instagram where advertisers have been able to be more targeted and consequently have grown their budgets. This shift has meant TV has become more interesting DTC brands. Previously, there’s been too much wastage on TV for those brands to spend sufficiently.

Quote of the day:
“Now, our briefs start with the conversion parts of the media mix, which involves the creative, media planning and the brand team. Doing so, means we can be 100 percent sure where the growth opportunity is among audiences as well as be clear on how we’re going to target those groups and scale them in various ways. At the moment we spend around 25 percent of our media budget on conversion, 20 percent on consideration and then between 50 to 60 percent on above-the-line awareness channels. That’s a balance we want to evolve because there’s a challenge to get increased media spend. We have the ambition to upweight the conversion parts of our media mix so they account for around 30 to 40 percent of our total outlay while reducing the amount we spend on awareness activity to around 40 or 30 percent.” — Sarah Dossett, marketing director for Danone in the UK, Ireland, Belgium, Netherlands.

Coming up
9:30 a.m.: Agency execs from Wagemaker and Omnicom debate The Evolution of the Brand and Agency Relationship, Ad Shapers Stage 4.

10:00 a.m.: Cannabis, Hemp and CBD marketing is expanding. Hear from Drake Sutton-Shearer from media company PRØHBTD on the trends: Hello Cannabis, Hemp & CBD, Tech Stars Stage 2.

11.15 a.m.: Pink News, The Guardian, Vice and MediaCom join Snapchat GM Ed Couchman to discuss how they use vertical video at Vertical Visionaries: Publishers & Brands Talk Mobile Video On Snapchat, Impact Makers Stage 1.

2.05 p.m.: hear how innovation in digital out of home is gaining pace: Out-of-Home: The New Digital Medium, Workshop Stage 7.

3.40 p.m.: Brave Bison, That Lot and Jungle Creations discus The Social Evolution, Story Crafters Stage 3.

4.35 p.m.: How digital marketers and publishers can master contextual storytelling: Context Is Everything: How Contextual Advertising Works, Workshop Stage 7.

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