The New KPIs for TV Advertising

09 October 2017 • tvsquared

If you’re only relying on reach and frequency metrics, you’re missing out.

Do

Don’t

Define and measure performance-based KPIs that are unique to your brand

Solely rely on old-school metrics like CPM, GRP and ratings; they don’t tell you about real-world results

Consider media planning as business-outcomes planning – they are one and the same

Spend all your TV budget based on pre-buy metrics – there’s too much guesswork involved

Think about intent-based metrics for higher-consideration/price-point brands

Assume KPIs are relevant for all advertisers – the best metrics are brand-specific

Leverage first-party, same-day data analysis to ensure measurement is based on real-world results

Disregard all traditional metrics, they have a role to play

Linear TV is still the most effective marketing channel for advertisers, and the way in which it can be measured and optimized has evolved significantly in recent years. To fully take advantage of TV’s potential, advertisers need to revisit the metrics they use to gauge campaign performance.

Simply relying on reach- and frequency-based metrics, TV measurement staples for decades, will no longer cut it. While things such as GRP, CPM and ratings certainly have a role to play in brand awareness, they don’t tell advertisers how spots drove response in the real-world.

Today’s advertisers need to measure TV through brand-specific, performance-based KPIs.

It’s all about using data-backed metrics that link campaign performance to business impact. These are metrics that answer the question, “how does our TV spend tie back to our corporate results?” So, what are they? Well, that depends on the brand.

Today, the touch of a smartphone is all it takes for a consumer to respond. There is no interruption, and responses can be directly connected to the content generating them. TV advertising, once used primarily for brand awareness or consideration, is now driving people directly into the customer journey via digital (search, site traffic, app activity, etc.). This is where measuring TV becomes brand-specific, and it’s where an advertiser can get really creative!

With the right technology, measuring a sale that is directly due to TV is easy. An advertiser can tie the spot airing to an immediate action like an online sale, subscription, registration, etc. Lower-consideration products typically enjoy conversions closer to the spot airing, but not every brand has that luxury.

For higher-consideration brands, the end result doesn’t happen right away, and directly tying a spot to a sale becomes more difficult. In cases like this, where a purchase might not happen for days, weeks or months, TV advertisers turn to action- or intent-based metrics.

For an auto manufacturer, this could be “find a dealership” form fills or “request a quote” queries. A cruise company might track “show me the deals” inquiries, or an online travel brand would measure new app downloads. A QSR might measure coupon downloads and usage.

A few years ago, advertisers might not think these type of middle-of-the-funnel activities would carry any monetary value. But actions that lead to sales, whether right away or weeks down the line, are quantifiable and excellent indicators of TV performance.

Take the guesswork out of TV advertising measurement. It’s time to leverage performance data to ensure your spots are reaching the right audience in the places and times that will drive maximum online and offline response.

Intent-based metrics are brand-specific, but here are a few more traditional metrics that hold value and are used by many TVSquared customers:
Return on advertising spend (ROAS) Marginal & incremental cost per acquisition (CPA)
Return on marketing investment (ROMI) Cost per registration (CPR)
Cost per visit (CPV) Cost per sale (CPS)

To learn more about how to measure and optimize TV, contact marketing@tvsquared.com for a demo.