Why Your TV Advertising Test Failed

Why Your TV Advertising Test Failed

I’m a former CMO now focused on advising companies how to launch TV advertising, mostly Streaming TV advertising, also known as OTT (Over The Top). I’ve had lots of success using OTT to help clients scale beyond Search and Social advertising, including Ethos, Grove, Masterclass, Nerdwallet, Square, Thumbtack and Upstart. See my recent post about OTT as the next large performance channel for more on that.

Over the past few years, I’ve talked with more than 50 companies about their TV advertising. I’ve seen why prior TV tests failed and have run many large before-and-after tests. Here are the lessons I’ve learned and the 5 top reasons why TV tests fail, to help avoid them from happening to you.

Caveat: My focus is more on Performance advertising, where companies spend money and expect to track it through to revenue, and mostly for direct-to-consumer digital companies, where transactions happen on web sites and in apps. So this advice may not apply as consistently to more brand or brick & mortar advertisers.

Here we go…

1. OTT First

Don’t make the mistake of testing Linear or traditional TV advertising first. The world has changed. The Linear audience is declining and aging, while the OTT audience is growing rapidly. OTT is easier to target, track and attribute than Linear, so you can spend half the test budget on OTT than on Linear. Plus, OTT now has more scale than Linear, with typical performance budgets around $3M/month OTT and $1M/month Linear, which is the opposite of several years ago before Covid. 

Solution - Test OTT first, learn what works, then leverage that on a Linear TV test later.

2. OTT Rates

Don’t test OTT with expensive ad rates. I frequently see companies and their Linear media agencies running OTT tests at $15-$30 CPMs (Cost Per Thousand impressions) as many rely on middle-men services like The Trade Desk with higher ad rates and markups. But I’ve re-run OTT tests at those same companies at $5-15 CPMs and get 2-4X better performance results. It's also important to realize that OTT is fundamentally different than the digital ad auctions and algorithms that drive Google and Facebook, so you need consider ad rates more on OTT.

Solution - Test OTT with lower $5-15 CPM blended ad rates across your media plan.

3. OTT Targeting

Don’t run OTT tests without any audience targeting. Advertising to everyone watching Hulu or NBC is not a very good test. Advertising is now available across over 100 OTT networks, and many enable using audience targeting, thru programming clusters (ex. reality shows), demographics (women age 25-34), geographic (suburbs), behavioral segments (new homeowners) and by device (mobile). In addition, OTT audience targeting is available at similar or just slightly-higher CPM ad rates.

Solution - Test OTT using a variety of media and audience targets at similar ad rates.

4. OTT Devices

Don’t run OTT tests only on CTVs (Connected TVs) as that overlooks the larger and often more profitable opportunity of running OTT on desktop computers and mobile phones. Ask anyone under 30 how they watch TV–it isn’t all on the family room TV any more. And for companies driving consumers to a web site or an app, I’ve seen the data myself, it’s better to advertise to them on the platform they can convert on, rather than the platform where they can’t. In addition, desktop and mobile rates for OTT are typically lower than CTV rates.

Solution - Test OTT with an analytics platform that can detect, target and optimize by device, from desktop to mobile to CTVs.

5. OTT Measurement

Don’t measure OTT using a Linear lift model or a How Did You Hear Survey, those are out-dated approaches. Instead, use a modern OTT system that leverages identifiers and device graphs to track from OTT impression to OTT conversion. OTT even enables applying attribution logic and testing for incrementality. Measurement with OTT is actually more precise than other digital channels, especially high viewthru channels like Facebook and YouTube.

Solution - Test OTT with a media partner who has built the systems to track and attribute OTT with a focus on data transparency, attribution and incrementality.


Fortunately, these are all addressable areas that don’t require lots of money, people or time to get right–just a different approach to testing TV, often with a different partner using different media and different measurement. And while all this doesn’t guarantee that OTT will be your largest and best performance channel–after managing over 25 OTT launches, I can say it’s pretty likely it will be.


Note, my clients mostly come from Founder and VC referrals, but I’m happy to talk with any funded companies who are looking to test and scale OTT. You can reach me on LinkedIn or at petercharrison99@gmail.com  

Jink C.

Head of Player Acquisition @ LottoGo.com | Performance Marketing Expert

1y

Pete Harrison. Thanks for this amazing insight. It answers a lot of my questions about a previous unsuccessful linear TV campaign I ran. Looking forward to your future posts!

Jason Howell

VP Sales, Media & Entertainment / Publisher Solutions at Kochava

1y

Great article Pete Harrison. Targeting plus outcomes based incrementality measurement makes OTT/Streaming the next great performance channel. Many media companies and providers are moving to empower this type of direct measurement. Any DTC or app based/digital focused marketer should be getting the Growth and Brand teams together as their efforts can now be more aligned.

Justin Schultz

head of marketing (former headspace, tinder, electronic arts)

1y

This is a great read! I’m curious on your measurement piece. How do you correlate that to incremental growth and not just mis-attribution or cannibilization?

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