How DRTV (Direct Response TV) allows measuring the ROI of TV ads like with digital advertising and ADS?

The traditional approach to TV advertising.

Until very recently, when an advertiser ran a campaign on TV, they would measure its effectiveness based on the volume of sales in stores, as well as the incremental in-store traffic during and after the TV campaign, and also the evolution of brand attributes such as spontaneous or assisted awareness, campaign recognition and attribution, appeal, and purchase or inquiry intentions measured by specialized institutes from a representative panel of the relevant or targeted population.

The paradigm shifts generated by digital.

But that was then… On the one hand, the pressure on budgets has led every media or communication director to challenge yesterday’s choices. On the other hand, since advertisers often use different media at the same time, some nationwide and others only in major cities, it has become difficult to attribute the increase in sales or the evolution of image attributes with certainty to the action of a single medium.

These new arbitrations were made with the competition for TV by the hyper-effective media that is digital, which has shaken up habits in the media landscape and today allows measuring with precision the impact of digital advertising on site traffic (cumulative visitors, unique visitors), as well as the CPV (cost per visit), CPM (cost per 1,000 impressions), CPA (cost per action), CTR (conversion transformation rate), and ROI of each ad, whether it be in AdWords, display, video or banner, even if the purchase action is deferred from the consumer’s initial contact with the ad or if they have been in contact with several ads and their path to reaching the page where the purchase is made has been complex and winding.

Responses from client ROI-oriented agencies

Advertisers who remain convinced of the relevance of TV, despite the audience fragmentation caused by the proliferation of channels, have gradually demanded that, in order to continue or start investing in TV, they be able to measure the immediate and deferred impact of a TV spot appearance on their website traffic and subsequent conversion of those visits. Players have organized themselves and today a few innovative agencies have evolved the concept of DRTV, which historically referred to Teleshopping, to make it “Direct Response TV” and ultimately offer advertisers tools that are very similar to those they use to measure the effectiveness of their digital advertising.

In particular, incremental traffic generated during the appearance of the spot and the following 8 to 12 seconds, called Direct Traffic, but also with the help of powerful algorithms developed by talented data scientists, the deferred incremental traffic generated, called Indirect Traffic, and attributable to each of the relevant spots.

Tracking spot effectiveness and impact on purchase

This allows for a disruption in the analysis of the ROI of each channel and each spot, no longer based solely on audience criteria, but on criteria of effectiveness and visits and conversions of visits. Thus, it also disrupts the way TV is bought and how to set up, run a TV campaign. The tools also allow for tracking traffic conversions into concrete actions (appointment scheduling, purchases, downloads), and thus calculating the ROI of each spot and TV campaign. This allows, on the one hand, the construction of a TV plan based on a very broad historical record of each channel and each spot’s capacity to generate traffic and, therefore, anticipate the potential ROI to be expected based on the advertiser’s projected investment, and with entry tickets well below what most advertisers imagine.

The second benefit is to build databases that allow for sector benchmarks, and to be able to objectify the performance of a campaign not only on the delivered GRPs but also on the traffic and business generated compared to normative values based on tracking campaigns in one or more industries.

The various actors who have developed tracking tools are numerous, among which we can mention @realytics @Admo, each with their specificities and the advantage of not being judges and parties since they are independent of the media agencies in charge of buying space on behalf of advertisers.

The corollary of this approach is a strong transformation of TV ad buying, which until now was largely delegated to the ad agency as part of a contract of qualitative objectives associated with guaranteed delivery of a certain level of GRP (Guaranteed Rating Points), to a spot-by-spot buying logic, with dynamic optimization based on business results during longer TV campaigns and with arbitrations focused on ROI.

This is how TV has gained its nobility letters among the Pureplayers accustomed to tracking the effectiveness of every euro invested in media, and how some agencies have reinvented themselves to challenge their long-established habits and accept spending more time managing their clients’ TV campaigns.

The corollary is to get the advertiser to accept higher fees, justified by daily monitoring and dynamic optimization of their campaign, which is incomparable to the workload generated by a campaign delegated to the TV agency with Guaranteed Rating Points (GRP) and delivering measurable ROI.