Tag Archives: ads

OTT video ad spend up 18-fold

Findings from video ad serving platform SpotX, reveal explosive growth in global OTT video advertising spend across its platform. The OTT video category includes broadcast-quality inventory from TV networks, Multichannel Video Programming Distributors (MVPDs) and other live, linear and VoD streaming services delivered via connected TV devices as well as desktop and mobile screens.

SpotX’s data revealed that the portion of overall ad budgets spent with OTT inventory owners increased from 8 per cent in October 2016 to over 26 per cent of total spend for October 2017. This equates to nearly 18x growth in advertiser dollars spent on OTT inventory owners year over year in October. As the holiday ad spend push continues, OTT is expected to account for around 30 per cent of video ad spend by the end of 2017, pointing to a macro-level growth trend that shows budgets adjusting in favour of OTT streams as consumers increasingly view content across devices.

“We’ve seen DSP partners increasing their focus on OTT in response to a shift in consumption habits,” said Kelly McMahon, VP of Global Demand Operations at SpotX. “By making addressable OTT inventory available to buyers through their platforms, they’re placing themselves ahead of the curve in terms of innovation and enabling advertisers to reach audiences across multiple screens at scale.”

Of the 65+ DSPs buying through SpotX’s platform, Adobe Advertising Cloud, dataxu, The Trade Desk, VideoAmp and ZypMedia are leading growth as the top platforms transacting on OTT inventory. Since January of this year, their collective daily spend on the category has grown by more than 675 per cent.

“The key to buying across video channels, including OTT audiences, is taking a holistic view of the data that can be made available; specifically: linking consumption behaviour, or what people watch, to digital activities, or what they do online, along with ad exposure data,” said Jay Prasad, Chief Strategy Officer, VideoAmp. “As a purpose-built platform for the converging linear and digital worlds, we are enabling these data assets to work in concert to deliver better scale and efficiency for advertisers.”

“Streaming live TV is now mainstream behaviour, opening the door for advertisers to capture today’s young, affluent, hard-to-reach consumers who aren’t subscribing to traditional cable TV,” said Adam Lowy, Head of Advertising Sales for Sling TV.

The Holy Grail of TV Advertising – Are You Missing Out?

Digital advertising is exploding across screens. The associated growth of digital attribution models used to measure performance has led to the idea that linear TV advertising is not as effective as it once was. However, TV IS still driving sales. I see it every day and I experience it myself in my own purchase decisions. Linear TV advertising is still the most effective way to reach consumers at scale, is proven to be a major sales driver and is the fuel for lower funnel conversion activity.

A recent study published by Neustar found that for a $1 million investment, TV’s lift is consistently seven times better than paid search and five times better than online display advertising. That’s pretty significant, and as such, it’s top of mind for advertisers to make sure they are leveraging TV advertising to increase their sales.

Direct attribution – especially for linear TV – has always been tough to achieve, but it’s not impossible. In fact, I posit that the “Holy Grail” of TV advertising is finally upon us, and advertisers can (and should) plan, manage and measure TV with the precision traditionally expected of digital screens.

Here I outline the top three things you should incorporate into your advertising strategies if you want to achieve the “Holy Grail” in TV advertising.

1. Greater TV Advertising Automation

Automation in TV is fairly new. Many in the business aren’t even aware it’s being done. It definitely can and is being achieved by leading players in our space, but very few have true clarity on what can be done and how best to apply it. As companies continue to innovate and advance, we’re going to start seeing automation in TV advertising being implemented more and more.

So, why is it important? Automation is especially important in that it brings additional data to TV. With the amount of data that is being applied to TV advertising, it would take ages to process it without using technology. Automation speeds up the entire TV advertising process, allows for the creation of custom strategic targeting – leading to more accurate targeting, provides in-depth reporting and also allows for increased transparency and control.

2. Linking Your Digital Investments to Your TV Investments

Once you’ve applied the data to your investments, you can link it across screens. As an advertiser looking to target specifically on TV, you know how important it is to invest in both TV and digital advertising, but do you realize the importance of linking both investments together?

Just last year, the Advertising Research Foundation (ARF) released an in-depth research study analyzing the state of advertising, based on over 5,000 campaigns, 12 years of data, $375B in advertising spend in 41 countries, across over 100 categories. The study revealed that spending across multiple platforms delivers greater ROI than any single platform. And in turn, the study found that “silo-investing” – too much frequency via a single platform—can lead to diminishing returns.

It’s important to link your digital investments to your TV investments; doing so will allow you to measure how your digital investment is performing, and then use that data to better inform your TV strategy – ultimately, having both investments working more closely together. As an advertiser, you should start tagging your campaigns on digital to see who is converting online, then utilize that data to focus your TV buying strategy. Linking both investments together yields the best results time and time again.

3. Closed-loop Attribution Across TV and Digital

Now this is arguably the biggest piece of the pie in achieving the “Holy Grail” in TV advertising. The ability to identify which TV ads drove conversions, is a concept many advertisers don’t even realize exists, but it’s here. For example, pixeling your website to understand conversions and activities can be directly tied back to TV’s exposure, showing us what’s most effective in driving consumer engagement.

To determine the true ROI of your advertising, it’s critical to measure your investments holistically across devices. In other words, closing the loop on attribution across your TV and digital investments to ensure that they are truly measuring how TV is contributing to overall performance; then, combine the results for true measurement, using a common metric. This is the only way to see what your advertising campaigns are really achieving, and in turn, improve your marketing strategy in future campaigns.

read more here: www.broadcastingcable.com

What advertisers expect from online video in 2018

Despite placing great faith in online video as a means of connecting with audiences in the near to mid-term future, marketers are largely unsatisfied with their advertising strategies in the space thus far.

A survey released today (November 28) indicates that only 6% of marketers would currently characterize themselves as “innovators” when it comes to their use of online video. Albeit the vast majority want to improve their efforts in the space, with 80% of correspondents reporting that they will increase their video advertising efforts in 2018.

The report, entitled “Where are Brand Marketers Taking Their Video Strategy in 2018?”, was conducted by video adtech outfit Innovid along with Brand Innovators and queried 140 marketers on their attitudes around their own brand’s video advertising strategy. This included: their attitudes around data integration; how they assess their success; as well as their video advertising plans for 2018.

Participants in the survey cited three principal reasons for their comparative company’s lack of leadership in the video advertising space, primarily a lack of: budget; in-house expertise and prioritization across the wider organization.

Marketers cite funding as the gating factor in video advertising volume for the vast majority of marketers, although 79% of participating companies will increase their video advertising efforts in 2018.

Facebook and YouTube currently dominate when it comes to advertisers’ video ad spend, while OTT video platforms – such as Hulu and Roku – currently account for 9% of video ad spend. Ad spend on such formats is expected to increase “significantly” in the 12 months to come.

The survey also found that interactive TV ads are currently underutilized because there is a general lack of knowledge about the capabilities that current video advertising technologies provide, according to the findings.

It also found that 90% of marketers understand the value of using digital key performance indicators (KPIs) when it comes to measuring the effectiveness of an online ad campaign, as opposed to using more traditional KPIs.

However, 35% of marketers rely completely on their media agencies when it comes to online video advertising expertise, according to the study. It also suggested that marketers are largely are uninformed about the costs associated with deploying customized video ads, with 45% reporting that they don’t believe that creative can be customized into hundreds of variants for less than $20,000.

Beth-Ann Eason, Innovid, said that brands need to select partners with expertise in video marketing strategies in order for them to solve real business problems through data-driven creative campaigns with concrete measurement and results.

Eason stated: “Many marketers seem to be coming down hard on their own video marketing efforts, but it is also clear that there is so much untapped potential and optimism about video marketing and its impact on consumers to be harnessed in the year to come.”

read more here: www.thedrum.com

Several Things the TV Advertising Industry Should be Worried About

GroupM’s ‘The State of Video 2017’ report released today doesn’t forecast the doom and gloom for linear TV that some are predicting. With TV making up 60 percent of the world’s traditional media spend, and still rising, GroupM says that TV is seen by many advertisers as essential for brand building and still represents “the peak of consumer engagement”. However, TV is still facing a number of serious challenges GroupM have set out some of its concerns about its future as an advertising medium.

Rising costs but declining audiences

The decline of TV audiences are often overstated, with much of the audience of linear having switched to digital platforms instead. But traditional TV viewing is falling as younger generations turn away from linear – GenY viewership has fallen by about 4.5 percent annually in the UK and US, and for GenZ the figure is close to 9 percent. GroupM finds that aging does not increase people’s viewing like it used to, and predicts that aging GenY and GenZ audiences will erode viewing at a pace of one percentage point a year over the next decade.

Meanwhile rights costs are rising fast, especially for sports, where high loyalty and engagement ratings have seen investments in rights and ad dollars spent on sports rise quickly. But even with sports, GroupM says younger generations aren’t as attracted as older groups, and sports in the future might not guarantee the same huge audiences they do today. Continued audience loss and fragmentation could make it impossible to sufficiently monetise content for linear broadcasters to cover its growing cost.

The threat of the digital giants

Traditional broadcasters will struggle to compete for audiences and programming with the likes of Netflix and Amazon, whose economic model is currently based solely on growth rather than profitability. Netflix and Amazon are estimated to spend around $10 billion per year on content acquisition and creation, and offer a tempting opposition to the emerging ‘skinny bundles’ of limited channels and networks, especially to viewers not interested in sports. “If you are a sports fan and impatient, it is complex and expensive to get everything you want,” says the report, “If you are neither, it is easy and cheap – go to Netflix or Amazon.”

GroupM say that no national media company has the resources to compete with these players on a global basis, and that it won’t be a surprise if Amazon Prime and Netflix come to form the anchor of the new entertainment landscape.

TV’s long tail under pressure

The long tail of TV, the lowly viewed niche channels that come with pay-TV packages, faces threats on two fronts. The cheap inventory on these channels has helped mitigate TV ad inflation in the past, but the emergence of on-demand video is making TV’s second rate ad inventory on these niche channels hard to sell. The report says these channels in the past held a sort of quasi-on-demand status, offering a certain type of content at any time of day, a status it’s losing in competition with actual on-demand.

Partly as a result of this, networks and broadcaster themselves are now offering stripped-back ‘skinny bundles’, free of these long tail channels, and as these bundles become more mainstream, the economics of long-tail channels and programmes will come under even more pressure.

TV measurement is still inadequate

Viewing measurement has not kept pace with changes in viewing habits, with a lot of content now watched on poorly measured or completely unmeasured screens. Even where there is measurement viewing standards vary, making total measurements of a show’s audience inaccurate and making it harder to monetise to its full value. GroupM says that the loss of linear audiences is largely an illusion, but until a holistic method of measurement with common standards across platforms and devices exists, TV shows will remain undervalued. What is necessary according to the report is “a universal, any-screen, respondent-level method with automatic content recognition.”

Long commercial breaks becoming unacceptable

With SVOD services like Netflix giving audiences ad-free viewing, and short-form online content being supported by short and often skippable ads, audiences are becoming intolerant of the long ad breaks featured on linear TV. Channels are now having to experiment with shorter, less intrusive breaks in the hopes that linear audiences will stabilise or grow, and that advertisers would be willing to pay a higher premium for this more effective inventory. The report advises that TV must make its advertising more relevant, making it more native to its environment and more audience-friendly.

read more here: videoadnews.com

OTT Content on YouTube Offers New Ad Opportunity

Over-the-top streaming services are big traditional TV advertisers gaining viewers, but when it comes to connecting with fans, they’re increasingly going online, according to Zefr, which helps marketers target viewers on YouTube and Facebook.

Zefr says that over-the-top shows are among the most popular content on YouTube, and while a lot of traffic is generated by official channels, fan content is also generating billions of views, making YouTube a potential place for advertisers to connect with fans of those shows.

In its recent TV 3.0 report, Zefr found that 77% of the views of Netflix related content was driven by fans. There are more than 81,000 fan channels on YouTube versus 10 official channels. Those fan channels had 4.7 billion fan views and 46.8 million fan engagements, compared to 1.2 billion views and 10.9 million engagements on the official sites.

“The study shows something we’ve known for a long time, which is fan communities that are watching OTT content are going to YouTube when they want to extend the conversation,” says Zefr co-CEO Rich Raddon.

The trailer for season 2 of Netflix’s Stranger Things quickly attracted about 9 million views on YouTube.

“You see a lot of advertising of Netflix shows on YouTube, It’s a really fertile ground because of all the activity that’s going on in these communities,” YouTube is a great place because we know the younger streaming audience is very tech savvy. It’s a great place to mine for new subscribers or new subscribers of content. “

Zefr wouldn’t say if Netflix is a client, but said it frequently works with OTT companies.

The top over-the-top show on YouTube is HBO’s Game of Thrones. It is followed by an older HBO show, ‘Sex and the City’.

The rest of the top ten are Stranger Things, Orange is the New Black, Last Week Tonight, Marvel’s Defenders, Curb Your Enthusiasm House of Cards, Narcos and 13 Reasons Why.

Advertisers can buy commercials in these shows on HBO or Netflix, but there are opportunities to be near that popular content on YouTube.

“If you’re a marketer at Netflix, if you’re a marketer at it Hulu or Amazon Prime and you’re releasing 80 feature films you know in a year, how do you target appropriately the audience that would be interested in that kind of content,” says Raddon.

Radon says movie studios and TV networks have been using entertainment-related content on YouTube to promote films and series.

But there are opportunities for marketers of other products as well.

“Advertisers that are used to buying specific content can capitalize on the scale of YouTube,” says Toby Byrne Zefr’s president.

read more here:

Ad-tech companies calling new Chrome browser a dictator

Google’s Chrome browser will automatically block certain ad formats, and that’s causing ad tech companies to scramble. The startup Parsec says it is completely shifting its business because of Google. Google says its actions are based on the recommendations of the Coalition For Better Ads, a cross-industry group focused on stemming the rise of ad-blocking Yet many in the digital ad industry aren’t clear on when these changes will take hold, what they need to do to prepare and who’s driving them.

Parsec, a three-year old startup, had found its niche. The company designed ads that people have to move out of the way with their finger order to keep reading a story on their mobile phone. The unique approach meant users would be forced to interact with an ad, instead of just letting it slip past as they read a story or click through a slideshow. The rough idea was that more people would be forced to stop and notice these ads, and ideally, they’d spend more time with them than the average banner.

Now, Parsec CEO Marc Guldimann says Google is blowing that business up.

Starting next year, when Google rolls out the latest version of its Chrome browser, those ads will be automatically blocked. It’s not just them. Also blocked are ads that automatically start blaring sound, and others like these that Google says make the experience of browsing the web worse. So Parsec is scrambling to ditch the old ad unit entirely – which means getting publishers, advertisers, and other business partners to run an entirely different, Chrome-approved, ad unit.

Here are the old Parsec ads:

Guldimann acknowledges that the company was always going to have to move away from ads that force interaction. But his complaint is that Google is using its massive power in the digital ad ecosystem, to play judge, jury, and executioner of ad-tech companies. He’s not clear, he says, on how Google made the decision it did or when and how it’ll be implemented.

“Right now, they are a benevolent dictator,” he said. “Let’s not joke ourselves. They own the browser. We’re playing in their world. They set the rules.”

Parsec isn’t alone in facing a sudden shift from a tech platform. Publishers too – especially those that had loaded up their sites with lots of videos that play automatically with sound- have to work out what the new Chrome restrictions will mean. Yet as the industry grapples with how to adapt to the coming changes next year, there’s loads of confusion over who is in charge, how the annoying ads will be identified and what the timeframe is for compliance. It all points to an uncomfortable position for Google, which is both a massive ad sales entity and the provider of the web’s most popular browser in the U.S.

Google says its just following the lead of the Coalition for Better Ads, a consortium of ad industry trade groups and big tech and media companies formed in September of last year.

The Coalition says it has conducted proprietary research on over 100 types of digital ads graded by 25,000 consumer respondents in the U.S. and Europe. That’s how it came up with dozen ad types that consumers find ‘annoying’ and that publishers should avoid. The list includes video ads that play automatically with sound and ads the cover more than a third of a person’s screen, for example.

It also includes “Full-Screen Scrollover ads,” or ads that “force a user to scroll through an ad that appears on top of content.” In other words, exactly the kind of ads Parsec bet the company on.

Google says with the coming Chrome update it’s just providing the hammer that the industry can use to apply these recommendations in one fell swoop. ” Thanks to the Better Ads Standards, the ad industry has 12 ad experiences that we know annoy Internet users and encourage people to opt out of ads entirely,” said a Google spokesperson.” Chrome has a long history of protecting users from annoying or harmful experiences. For example, like other browsers, Chrome blocks pop-ups in new tabs and shows warnings before malware pages. “


Given the rise in popularity of ad blockers, it’s clear that digital advertising needs to clean up its act. Many ad insiders, though, aren’t wild about Google deciding what ads are ok and which are not.

In fact, several executives told Business Insider they are of the belief that Google is the driving force behind the Coalition, and that it is funding and dictating the effort. They speak as if the Coalition is Google.

Both Google and the Coalition say this is not the case.

Parsec is moving forward with new ads that the company hopes combine consumer interruption with consumer respect. Guldimann estimates the company is about halfway through its transition to Chrome friendly ads.

The new Parsec ads:

read more here:


Views Need to Replace Impression-Based CPMs

Programmatic digital advertising was supposed to deliver a new level of accountability: Narrower targeting to drive more tailored messages, and performance metrics that inform what’s working and what’s not. But the promise of programmatic is rendered moot if ads are not viewed by human beings.

The economic framework of digital advertising on the open internet is still defined by impressions rather than views. Beyond Facebook and Google, there are thousands of quality domains and apps out there that offer superior, brand-safe content. For marketers to reach those audiences with full confidence, it is critical for programmatic technology to shift from impressions to views, with buyers paying if, and only if, their ads are viewed.

Indeed, for more than 20 years, digital advertising has been bought and sold based on CPMs. By definition, then, this universal digital currency values the number of impressions served rather than audience time and engagement, and the digital media economy has developed accordingly. Publishers are rewarded for quantity and scale—not the quality—of ad units.

Low CPMs and poor user experience

In 2011, according to an article on Adobe’s Digital Marketing Blog, CPMs declined a jaw-dropping 31 percent year over year, despite a corresponding 271 percent increase in the number of impressions served. “The key driver for CPM declines appears to be a wider play for less expensive inventory,” the author noted.

As CPMs for display ads decreased over time, publishers had to achieve scale to deliver enough impressions to preserve monetization across their digital channels, and media buyers and traders had to buy more impressions to spend their clients’ budgets. It’s easy to see how clickbait, ad farms, pops and other low-quality tactics thrived on the internet. These business models were rewarded, even as the user experience was degraded.

It’s also easy to see why consumers adopt ad blockers to avoid the barrage of unwanted ads. Or why they turn to their Facebook News Feeds to consume their preferred media in an environment designed to balance curated information with relevant marketer messages. In addition to this engaged audience, Facebook offers another critical advantage to marketers: It only charges for ads that scroll into view.

Until now, marketers have faced a stark choice: Spend their advertising budgets on Facebook, with the guarantee their ads would be viewed, or use programmatic on the open internet where perhaps half of those units are viewable.

The need for viewabiity standards

Brands and agencies are rightfully demanding viewability standards on the open internet. But most technology has not yet caught up. As eMarketer reported last year, many media agencies don’t even have line items in their systems to support anything other than CPM-based media buys. This leads to a manual reconciliation process, which adds one more task to a media trader’s already long list of tedious to-dos.

Technology companies that support a free and open internet have an opportunity to meet and exceed these marketer demands. For the past three years, AppNexus has been investing in machine learning-driven technology to help traders buy on a 100-percent-viewable basis, even when publishers are still defaulting to sell on CPMs. On each impression, AppNexus automatically predicts the likelihood of a view and pays the publisher per impression based on that prediction. The buyer only pays for impressions that are viewable.

Outcomes-based buying

Meeting the viewability standard is just the first step in achieving better economic incentives and measurement for digital ad effectiveness. The future will bring additional outcomes-based buying solutions that allow marketers and agencies to buy on the basis of tangible and verifiable results like video completion.

Automated outcomes-based buying will enable media traders to spend their time gaining a competitive advantage for their clients. Indeed, there is no one-size-fits-all strategy or metric for user engagement. Attention and engagement differ across channels (desktop, mobile) and formats (display, video, audio, native). Traders’ roles, in turn, will shift to delivering strategic outcomes as opposed to blanket impressions.

read more here:


Can Broadcaster Alliances Overcome the Hurdles to Addressable TV Advertising?

The growing range of addressable TV products coming to market are opening up an array of new opportunities for media buyers. But the new landscape also poses challenges, as the various technologies, measurement options and regulations can make it a complex environment for buyers to navigate. Our panel at New Video Frontiers in London last week discussed how broadcasters are forming alliances to overcome these obstacles, allowing them to offer data-driven campaigns at scale with consistent measurements, currencies, and sales points. They also discussed the broader future of TV advertising, and the advance of the online tech giants into TV-like content.

Brands Are Doing More Experiential Marketing

As brands see more and more people use ad blockers, tune out TV spots or cut the cord altogether, it’s easy to see why Jaguar, Absolut, Mastercard and more are turning to experiential marketing, which they say has the potential to create direct connections and more meaningful relationships with consumers.

“It’s more and more difficult to succeed through traditional advertising,” says Raja Rajamannar, chief marketing officer for Mastercard, which revamped its marketing strategy a few years ago to focus on experiences. “With the amount of clutter you’ve got to cut through, the attention span of the consumer going down—six seconds is what they say the attention span of a human being is, less than a goldfish—so how do you get past that hurdle and then inspire consumers?”

Enter experiential. In a perfect world, here’s how an experiential marketing effort would play out for consumers: You’d encounter a brand experience, find it so awesome that you’d post about it on your social channels (where more people would hear about it), give the brand your contact information (so that they could send you emails and offers and put you in touch with a local retailer), and become more likely to purchase something from said brand.

“I like to say, ‘What takes traditional advertising weeks, months or years to do, we can do in a moment,’” says Bryan Icenhower, president of WME’s experiential agency IMG Live, which works with brands like Marriott, Subway and Budweiser. “Experiential is a uniquely fast and effective way to build brand awareness through one-to-one connections with consumers. It engages all five senses, sparking emotions that form lasting memories which have been shown to drive brand loyalty.”

With a promise like that, it’s easy to see why marketers are shifting dollars into experiential marketing. According to the Freeman Global Brand Experience Study, which was released in May by brand experience agency Freeman and data company SSI, one in three CMOs is expected to allocate between 21 and 50 percent of their budget to brand experience marketing over the next three to five years.

“There’s a consensus among marketers that brand experience builds loyalty,” explains Freeman CMO Chris Cavanaugh. “We found that almost 60 percent of CMOs said they valued brand experience for its ability to create ongoing relationships with key audiences. Nine out of 10 respondents said they felt that brand experience delivers strong face-to-face interaction and more compelling brand engagement. And more than two-thirds of them agree that this medium is an effective way to achieve their business objectives.”

“By augmenting digital marketing,” he adds, “brand experience has the potential to increase lead generation, brand advocacy, and sales, and can even make customers feel more valued.”

Just last week at Advertising Week in New York, Mastercard showed off proof of its belief that experiential can drive sales, unveiling a new virtual reality e-commerce experience with Swarovski. Using a VR headset, consumers can see what Swarovski chandeliers look like in various spaces, and if they decide to purchase one, can do so directly through the headset using Mastercard’s Masterpass.

“We’ve found that the consumer experience is so seamless and that we’re giving the merchant the opportunity to close the sale in that moment of excitement, that moment of truth,” says Rajamannar.

Data baked in

How marketers measure experiential varies widely from brand to brand. Some, like Mastercard and American Express, have access to more consumer data (i.e. purchasing habits), which allows them to get more granular with their measurements. But all agree that measuring experiential has become easier, making it more attractive to marketers.

Michael Curmi, brand experience director for Jaguar Land Rover North America, says both the Land Rover and Jaguar brands are looking to expand their experiential efforts this year. “Part of that is due to better data and having the value of experiential be a bit more provable than it has been in the past,” he explains.

read more here:


IBM Ramps Up Its AI-Powered Advertising

In recent years, The Weather Company, which produces forecasts for 2.2 billion locations every 15 minutes, has been using its troves of data in ways that go far beyond what’s happening outside. Since its acquisition by IBM in January 2016, the company has also begun swirling deeper and deeper into the world of advertising with the help of Watson, IBM’s artificial intelligence service that’s working on everything from diagnosing diseases to crafting movie trailers. Now, IBM is finally bringing several major components of The Weather Company’s data capabilities under the Watson umbrella with the launch of Watson Advertising this week.

The new division—encompassing data, media and technology services—will offer a suite of AI products for everything from data analysis and media planning to content creation and audience targeting. By integrating The Weather Company’s signature WeatherFx and JourneyFx features along with all of the other data at IBM’s disposal, the company is hoping to transform what is in many ways still a legacy business into a cutting-edge advertising powerhouse.

“Weather impacts your mood and your emotions, and your moods and your emotions are a huge input into your decision-making modality,” says Cameron Clayton, the former CEO of The Weather Company who is now general manager of IBM Watson’s Content and IoT Platform.

Watson Advertising promises to kick start the era of cognitive advertising, a field that has both legacy tech companies and startups seeking to transform every aspect of marketing from image and voice recognition to big data analysis and custom content.

While there are countless ways to use Watson—through dozens of APIs or studio-like projects that can cost millions of dollars—its new advertising division is structured into four units. The flagship service, focused on audience targeting, will utilize Watson’s neural networks to analyze data and score users based on how likely they are to take an action (like purchasing a product, viewing a video or visiting a website). Another piece of the business will use AI for real-time optimization. A third, Watson Ads, will build on a service that launched last year with a number of high-profile brands, employing AI not just for data analysis or targeting but also for content creation. As part of a Toyota campaign, for example, Watson became a copywriter, crafting messaging for the carmaker’s Mirai model based on tech and science fans’ interests.

“The Watson Ad opportunity is an exciting first-to-market idea that advances our learning opportunities in the AI space,” says Eunice Kim, a media planner for Toyota Motor North America. “Not only are we able to create a one-to-one conversational engagement about Prius Prime with the user, but we’re able to garner insights about the consumer thought process that could potentially inform our communication strategies elsewhere.”

There have been plenty of other advertising opportunities for Watson. Earlier this year, it transformed into a doctor, promoting Theraflu while answering questions about various flu symptoms. For Campbell’s, Watson put on its chef’s hat, personalizing recipes within display ads using data about consumers’ locations and what ingredients they had on hand. For a major partnership with H&R Block, Watson turned into a tax expert, deploying an AI smart assistant to help clients find tax deductions.

“Brands are looking to AI as a feature that they might add and what that can do to distinguish them, modernize them and to give them a new look and a competitive edge,” notes Marty Wetherall, director of innovation at Fallon, which created H&R Block’s campaign.

As more marketers become interested in the potential of AI, the rebrand to Watson Advertising allows IBM to separate the advertising capabilities of The Weather Company from its other less-known operations—industries including aviation, insurance, energy, finance—explains Watson CMO Jordan Bitterman. Earlier this year, IBM created the Cognitive Media Council, a group of senior-level executives from agencies and brands that meet a few times a year to shape how marketers think about the future of AI.

read more here: