Why LG Ad Solutions Is Promoting A “Direct To Glass” Strategy
This is the first of our Innovator Spotlight interviews from our new report FASTs Are The New Cable, Part 2: Advertising. You can download it for free for a limited time.
“I like to call working with LG ‘having a direct to glass strategy’,” notes Tony Marlow, Chief Marketing Officer at LG Ad Solutions. “When you're talking about a massive OEM with a massive global footprint, it gives you scaled first party inventory and data, all from that same provider. It gives you control over the environment for things like suitability or fraud mitigation and it gives you access to custom creative solutions. That means we can offer creative units that are native to the homescreen, as well as traditional video ads. So basically, the ability to have campaigns that span both CTV video and our native inventory.”
ALAN WOLK: What are some of the other advantages of working with an OEM like LG, where you own the hardware and the software?
TONY MARLOW: The scale and diversity of the audience is a critical element to the benefit of working with a company like LG Ad Solutions where we're talking north of 130 million TVs worldwide. This is essentially de-duped scale that you might not get if you were operating with several apps independently, where you only see a sliver of the ecosystem.
There’s also the fraud issue. While we’ve been hearing a lot about the death of the dongle, when it comes to advertising, some dongles have issues: there was a report recently that they are serving up ads even when the TV is off because turning off the TV doesn’t necessarily turn off the dongle. That’s not an issue you’ll find with smart TVs—there’s just a single off button and so we avoid all those issues.
ALAN WOLK: Frequency capping, or the lack thereof, always crops up as an issue with CTV. How are you handling that?
TONY MARLOW: Using our own ACR, we can measure and control frequency, not just across a variety of CTV environments, but across both linear and CTV. Understanding what's hitting the glass, whether it's linear or CTV, helps you control frequency. It also helps you have an understanding of what is being seen on the screen, right down to the genre.
That’s important, because if you lack a holistic understanding of the user, from the type of content they like to engage with down to what ads have they seen, and it turns out that they have seen this particular ad too many times, it becomes difficult to make a meaningful connection with them. This is where we view LG Ads as having a real advantage— we can see those issues and we can deliver a meaningful connection.
ALAN WOLK: Netflix and Disney are about to roll out ad-supported versions, which means that all of the major SVOD services will have ad-supported tiers. How does that impact the FASTs?
TONY MARLOW: I think you're going to start to see even broader adoption of ad supported models of television, whether it's completely free or whether it's a subsidized subscription. It’s what we call “the Big Shift”.
We're in the second phase of the big shift. That first phase was the mass adoption of CTV at the onset of the pandemic, largely subscription-based at that point in time.
The second big shift is the move towards free content that's ad supported and right now, people are saying that they prefer the free option to the endless list of subscriptions services they are paying for. So having ad-supported options on Netflix and Disney helps make the notion of ad-supported streaming all that much more ubiquitous.
To that end, we just released a study around CTV that bears that out: eight in 10 US consumers have access to a connected TV and of those viewers, almost seven in 10 prefer ad supported models. So the tides are shifting.
ALAN WOLK: One of the most common complaints we hear from advertisers is that they don’t get the same sort of transparency on CTV that they do on linear. How is LG addressing that?
TONY MARLOW: When you're talking about transparency, part of that is just advertisers wanting to make sure their ads are running against high quality programming. So we think transparency is critical and we are very transparent about the content that we have on our platform. Advertisers know that it's quality, they know that they will wind up running against content that is right for their brand and for the campaign at hand. Plus, with ACR, we understand the content that is hitting the glass, whether that is CTV or linear.
ALAN WOLK: As an OEM, you also own the TV’s interface. How do you work with entertainment brands--other streaming services in particular—to help them promote their shows and draw in viewers?
TONY MARLOW: The ACR data that we have has huge value for entertainment brands. We know what’s been watched on that TV set, regardless of whether it was watched on streaming or linear. That opens up opportunities, like targeting based on genre, based on networks or even at a show level based on specific programming they have watched.
We can also target those households that don't currently have a specific entertainment app installed on their TV. So that eliminates wastage in trying to convert people who are already converted. Knowing these details is one of the reasons why the entertainment category really loves engaging with us, getting those direct links from native or other executions, and doing so in a way that's relevant to the audience while minimizing wasted impressions.
ALAN WOLK: Having so much data really opens up a lot of doors around the way TV is measured. What are some of the opportunities that have you excited?
TONY MARLOW: Right now we can understand all of the ways a campaign worked, whether that's awareness, sales, foot traffic, or some other measure of success. When you're measuring the ad, I think the primary objective is to measure whether it worked. Or, more accurately, did it work according to the KPIs that were set for it.
A marketer wants to know some ancillary things too, like am I reaching a real household, did the ad run against the genre that I wanted, was it in a safe and suitable environment? I think those are all important, but the primary measure is still “did the campaign work?”.
I’d say the same is true for measurements like GRPs or target audience rating points. Those all exist because linear TV wasn’t able to offer anything superior. But now, within a CTV environment, we actually have much more tangible ways of understanding how well an ad performed and I think that is what advertisers are going to be relying on and it’s why they are so excited about the FASTs and CTV in general—it marries the best of television and its sight, sound and motion, with the best of digital with all its rich metrics.
