Is Addressable TV Advertising Ready for Primetime?

Author

Michael Beach
September 10, 2020

The bull case for addressable TV advertising: The number of addressable households continues to grow along with advertiser demand.

Total TV households in the U.S. (% of total) according to USIM/Mitch Oscar:
1) Addressable – ≈ 68.5M (56%)
2) Non-Addressable – ≈ 52.5M (44%)
3) Total – 121.0M

Addressable TV households (% of total) by pay-TV provider:
1) Comcast – 18.8M (27%)
2) Charter Spectrum – 16.7M (24%)
3) DirecTV – 14.6M (21%)
4) Dish + Sling TV – 9.7M (14%)
5) Verizon Fios – 4.0M (6%)
6) Cox – 2.3M (4%)
7) Altice – 1.8M (3%)
8) Frontier – 600K (1%)

Addressable TV households (% of total) by rep firm:
1) Ampersand – 37.8M (59%)
2) Xandr – 17.0M (26%)
3) Dish + Sling TV – 9.7M (15%)

Big news: Verizon Media added addressable TV inventory from Dish to their DSP.  Adding this to the current Fios footprint gives them 11M targetable households.

The bear case for addressable TV advertising: Addressable TV advertising only accounts for ≈ 3% of all TV ad impressions.

Why this matters: The addressable TV ad market (pre-COVID) will grow 44%, outpacing the overall TV ad market (≈ 1%).

Addressable TV spend by year (YoY growth) according to eMarketer:
1) 2016 – $760M
2) 2017 – $970M (↑ 28%)
3) 2018 – $1.5B (↑ 51%)
4) 2019P – $2.0B (↑ 37%)
5) 2020P – $2.9B (↑ 44%)
6) 2021P – $3.5B (↑ 21%)

U.S. video ad spend by targeting method (% of total):
1) Non-Targeted – $49.2B (51%)
2) Addressable Digital – $27.4B (29%)
3) Data Driven Linear – $15.9B (17%)
4) Addressable Linear – $2.9B (3%)

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