Complete Story
11/06/2017
Get ready for targeted ads on digital TV
Online ads trying to sell us things we previously searched for are already the norm. But the advent of digital TV means our buying habits could soon influence the ads we see between our favorite television shows too.
"In theory, everyone could see a different ad, and that advertisement could be more relevant based on past purchase histories and viewing interests," Professor Carl Mela said. "That's a radical shift."
Mela, a marketing professor at Duke University's Fuqua School of Business, reviewed the viewing habits and purchase histories of 834 households across an entire year to study how advertising could be more accurately and profitably targeted.
"As television becomes digitized, capabilities are beginning to appear that never before existed," Mela said. "We leave digital footprints when we watch television. Every keystroke of your remote could be recorded. So for the first time firms can try to understand the viewing preferences of individual viewers and communicate with them one-on-one."
Mela drew viewing information from set-top box usage data, purchase data from the market research firm Information Resources Incorporated, advertising rates from TNS Research, and national viewing data from AC Nielsen. All data were from between June 2005 and July 2006.
"For the first time, we have household-level viewing information to understand about how people view TV," Mela said.
