Comcast targets DTC brands and SMEs with new advertising platform

In a significant development in the advertising landscape, Comcast is positioning itself to attract direct-to-consumer (DTC) brands and small-to-medium enterprises (SMEs) towards television (TV) and connected TV (CTV) inventory. This initiative, driven by the launch of its new ad sales platform, Universal Ads, seeks to transform the way these businesses, which have predominantly relied on social media and search advertising, engage with consumers.

During the CES event, Comcast’s president, James Rooke, revealed that Universal Ads is designed to unlock access to ad inventory across a range of media networks, including NBCUniversal, A+E, AMC Networks, Fox, Paramount, Roku, TelevisaUnivision, and Warner Bros. Discovery. “What we’re trying to do is unlock that [latent] demand and create a front door into the premium video category,” Rooke explained. This new platform aims primarily at digitally native companies that previously have not entered the TV advertising space but are now looking for avenues to scale their businesses by reaching qualified audiences.

A survey commissioned by Comcast among 250 non-TV performance advertisers indicated a shifting sentiment within the industry. According to the findings, 50% of the respondents reported decreased returns on their paid social spending, while a substantial 89% expressed a willingness to explore TV as an advertising channel. The need for measurable outcomes is underscored by Rooke, who noted that the platform includes a marketing API designed to provide DTC and small-business marketers the attribution and performance metrics they have come to expect from social media advertising.

Mark Marshall, chairman of global advertising and partnerships at NBCUniversal, remarked in an email, “We have a tremendous opportunity to steal market share from our tech competitors in a very unique and collaborative approach that will change the advertising landscape in a big way.” Despite this optimistic outlook, he withheld specific revenue projections for the new venture.

This move by Comcast follows a trend of growth in self-service platforms for ad sales, previously initiated by Paramount, Hulu, and Peacock. The intention is to appeal to DTC brands and SMEs, which have often been deterred from television advertising due to concerns over costs and insufficient ROI tracking.

Marketing professionals note that while paid social remains a key component of DTC strategy, escalating costs and intense competition within this arena prompt a reassessment. Recent data suggests that CPM rates have surged significantly across major platforms, with Meta’s average CPM increasing from $7.15 in 2023 to an anticipated $7.50 in 2024, TikTok’s rates rising from $3.48 in 2023 to $3.77, and Snapchat seeing the steepest increase from $5.20 to $7.65.

Katy Geisreiter, planning director at Media by Mother, stated, “We’re clearly at a point where we’ve reached diminishing returns.” This sentiment is echoed by Scott Harkey, founder and CEO of agency OH Partners, who observed diminishing returns on social and search efforts over the past two to three years. Additionally, recent changes in Meta’s policies regarding misinformation and fact-checking have led many to consider alternative advertising avenues. Rooke noted this shift as a catalyst for brands to view premium video as a transparent and brand-safe alternative.

Despite the notable decline in linear TV viewership, experts agree that TV and CTV advertising can be effective tools for expanding brand awareness. John Gladysz, head of product at Noble People, stated, “If you’re looking at your upper- and your mid-funnel, there’s real cost benefits to leaning into richer things: CTV, YouTube, [premium] video.” Dan Salkey, co-founder of Small World, observed a growing trend of ‘scale-ups’ incorporating TV into their advertising strategies in a more intelligent manner.

However, the success of Universal Ads in engaging smaller advertisers will largely hinge on the robust measurement capabilities afforded by its marketing API. As pointed out by Matt Larson, vice president of media and connection strategy at Collective Measures, “The challenge will continue to be the ability to attribute those sales back to the efforts themselves,” highlighting that while shifts towards TV may be underway, effective tracking remains pivotal for marketers.

As Comcast brings its new platform to the forefront, the long-term implications for DTC brands and their advertising strategies will become clearer, with potential competition for market share being a key factor in the evolving digital advertising landscape.

Source: Noah Wire Services