Top marketers are going digital to track the delivery of commercials into US homes with a system some advocates say will revolutionise advertising the way product codes changed the selling of sliced bread.
One day, it could even enable advertisers to target individual households.
The top four US broadcast networks -- CBS, ABC, NBC and Fox -- have signed on to comply with a new 12-character code for tracking all advertising, a system heralded as a new standard for monitoring the $263 billion US ad industry, the two advertising trade groups behind the system said.
Called Ad-ID, the technical switch is being compared to the introduction of the universal product code, or UPC -- the tiny bar codes that 30 years ago changed the way supermarket chains tracked and delivered inventory across the country.
Ad-ID gives advertisers a centralised Web-based system that helps assign unique codes to their properties. More than 100 leading advertisers and other trade groups have endorsed the system. The compliance of top broadcast networks paves the way for making it a standard.
Ad-ID`s designers are the Association of National Advertisers and the American Association of Advertising Agencies.
"There is no central authority that pre-existed Ad-ID," Barbara Bacci Mirque, senior VP at the ANA, which represents 330 top advertisers, told Reuters. "Now there will be a central authority."
Advertisers have been creating their own eight-character analogue codes to track mainly broadcast television commercials, an antiquated, patchwork system that cannot cover ad properties served across an explosion of new media vehicles, from hundreds of cable and satellite channels to radio and the Internet.
In the immediate term, Ad-ID will cut out costly code replications that have led to the wrong commercials being aired. Mirque cited one case where a movie studio mistakenly duplicated the code of a large fast food chain for its ads.
Targeting consumers
But advocates say the biggest benefits are yet to come, as advertisers invest millions more dollars into directly targeting consumers rather than aiming scattershot spending across large audiences. The system can accommodate multiple versions of ads, modified by city or even household.
"It is going to allow advertisers for the first time to precisely target individuals for whom the message has relevance," said Peter Sealey, adjunct professor of marketing at the University of California at Berkeley. "This way we can create on the fly a different ad for a different household."
For example, a diaper manufacturer could select households with babies while a dental adhesive maker would pinpoint their denture-wearing neighbours, based on information that consumers provided.
Sealey said advertisers would gain an unprecedented ability to see how their spending affected sales, especially as retailers adopt radio-frequency identification. RFID, the system that could replace bar coding, tracks the movement of individual products such as groceries from a few feet away.
In about five years, Ad-ID and RFID could be used together, he said.
"Then we could measure whether we delivered the commercial to you, and, as I am monitoring your pantry, whether you bought the product, too," he said.
Television network executives were not immediately available for comment. The ANA provided copies of compliance statements from ABC and CBS.
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