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As marketers continue leaning into new tools and technologies to prepare for a world without third-party cookies, much of the conversation about adaptation has focused on planning and targeting. These are obviously critical aspects of any marketing strategy, but it’s important to not exclude the need for accurate measurement as changes in the digital media environment accelerate.   

Importantly, the changes the industry has been making in response to increasing privacy requirements have implications for all aspects of digital marketing, and the new world of digital audience measurement looks just as different without cookies or MAIDs (mobile ad IDs) as planning and targeting does.

The other thing worth pointing out is that a transition to consumer-first digital marketing practices means that the data and insights marketers will have to work with will look different from what they are accustomed to. Said differently, we’re not simply replacing old processes with new ones that fit neatly into the same mold.

As we know, the increasing limitations on third-party access to cookies, MAIDs and other identifiers   complicate the ability for marketers to know exactly who sees their campaigns. That’s because as companies chart their individual paths to limit access to information related to their users, the deterministic approaches to link demographics to exposures that the industry previously used are no longer viable.

Instead of recognizing people and what devices they’re using, measurement services now need to establish new ways to identify devices and the people who use them, in a manner consistent with applicable privacy requirements. To be effective, these identifiers need to be:

• People centric
• Persistent (stable over time)
• Prolific (used consistently across the web)
• Transferable (across different devices / access points to enable cross -platform)

In all likelihood, such identifiers won’t be available to measure all digital impressions. To cover the gap, digital measurement will need to be augmented with an identity-less solution. To ensure maximum effectiveness, that solution should be probabilistic in design, relying heavily on machine learning, and contextual in nature, using clues and signals from how and where impressions are served in order to pinpoint user demographics.

It’s a unique time for digital marketing, and there are really three key areas that tech companies will need to solve for as they make their way toward holistic measurement in this new reality. First, agreements between measurement companies and publishers will be critical in order to measure their audiences. To determine all other open-web audiences, companies will need to develop alternate identity solutions that leverage responsibly licensed third-party user registration data. Lastly, companies will need models for the anonymous web where individual and device identifiers are not present. 

In this digital age, it’s easy to lean into big data, machine learning and artificial intelligence for tomorrow’s solutions. Importantly, brands and marketers cannot lose sight of the importance of actual people in modern marketing. People-based truth sets (panels) are more important than ever, as direct observation is critical to correct for bias and error.

As the evolution of measurement progresses, it’s important to recognize—and plan for—significant trend breaks. The environmental changes driving this evolution will fundamentally alter how we measure audiences. Given the change in the basis for measurement, notable trend breaks are to be expected.

It’s not every day that television gets a new ad category. It’s even less common for a new category to become a golden goose. Taboo until a 2018 Supreme Court verdict, online sports betting isn’t technically a new ad category, but with just over two years of a track record, few would challenge its advertising status as a golden goose, especially within the local TV industry.

Currently a $154 million market in the local spot space, online gambling advertising spend has skyrocketed from a mere $10.7 million at the start of 2019. According to BIA Advisory Services, online gambling has the potential to drive more than $587 million into the local spot TV market by 2024. The company maintains this as a likely forecast, given current trends and the expected addition of sports betting in a handful of states where legislation is pending. This is good news for the local TV market, which accounts for just under 80% of online gambling ads.

Forecasts aside, the increase in online gambling ads has been a boon for local TV stations, particularly as many traditional advertisers pulled back or paused in 2020 due to the COVID-19 pandemic. According to Nielsen Ad Intel data released in the March Nielsen Total Audience report, U.S. TV advertising dropped to just over $76 billion last year from just over $84 billion in 2019, with the retail (-22%), auto (-17%) and restaurant (-8%) categories pulling back notably.

Given the sports betting focus of the top advertisers, sports programming is a key way to reach sports bettors. Surprisingly, the largest share of online sports betting ads is currently allocated to news programming. One reason attributable to this fact is that local news stations have much more control over their total ad inventory (versus sports programming which typically occurs in primetime), and as a result, there is more flexibility to place ads in news. It’s also worth noting that the share of these ads in news programming has increased to almost 40% over the past year. The increase isn’t without its merits, as news offers significant reach and an opportunity to engage new spenders, growing the consumer base.

While sports programming still has the biggest reach (77%) of the country’s sports bettors, local news currently reaches just over half (53%) and growing. Other categories representing possible opportunities for brands seeking greater targeted audience reach for sports bettors include movies and comedy programming, with reach of 76% and 74%, respectively. 

Given the ramp-up in spending since 2019, online gambling now ranks 11th among 1,200 product categories for spot TV advertising dollars, accounting for 2.1% share. Comparatively, legal services, the top category for dollars spent, accounts for 7%.

As with any marketing effort, especially when the goal is brand building, extensive messaging across mass mediums amplifies top-of-mind awareness. And to that effect, the top seven advertisers in the online gambling space account for 96% of the spot TV ads in the category. What’s more, the top three are the most prolific spenders, accounting for 82%.

Among the top three spenders, FanDuel and DraftKings focus exclusively on sports betting. Their ad campaigns are prolific and produced to specifically appeal to the country’s rabid sports bettors. The targeting is spot on, as the 7.3 million daily fantasy bettors in the U.S. have an aggregate income of more than $780 billion, according to data from Nielsen Scarborough. Additionally, the new online sports bettor is younger than other bettors (live sports bettors at casinos, cash bettors at sporting events, organized fantasy league players) and is mostly male (77%).

In addition to revised federal regulations allowing advertised sports betting on TV, professional sports leagues themselves have increasingly warmed up to the idea as well. Today, NFL Commissioner Roger Goddell says sports betting creates more engagement with fans, which is a notably different perspective from back in 2012 when he expressed concerns about possible collusion and fixed games. Some sports teams, such as the New York Giants and Washington Wizards, have physical sports books inside their stadiums. And when it comes to TV, sports broadcasts no longer hedge when it comes to talking about game odds and spreads. In fact, some programming even features on-screen tickers detailing point spreads as the action unfolds.

The overwhelming sea change across the sports and media industries with respect to betting ads highlights a significant growth opportunity for both local and national television. In 2020, online/digital sports betting-related ad spend increased across 180 of the 208 designated market areas (DMAs) that Nielsen monitors. Additionally, online/digital sports betting spend in 185 DMAs exceeded $300,000, up from less than $50,000 across those same DMAs in 2017. So even though gambling activities are limited to select states, advertising in this category, where legal, is increasing across the overwhelming majority of the country’s 208 DMAs. And that spells opportunity for local news organizations and advertising agencies alike.