AT&T's New Ad Deal Shows What It Plans to Do with Time Warner
*By Michelle Castillo*
AT&T is beginning to flex its muscle as a potential advertising powerhouse by allowing brands to use its data to advertise on WarnerMedia properties.
The company announced a new partnership between its advertising business, Xandr, and WarnerMedia’s Turner on Tuesday. The offering will allow companies to use information from more than 170 million AT&T ($T) customers to help brands target their advertising on Turner shows, movies, and digital content.
Besides a few one-off deals, this is the first time AT&T is letting companies leverage its customer information for advertising.
AT&T absorbed Turner in its $85 billion acquisition of Time Warner last year. Turner’s networks include CNN, TNT, TBS, Adult Swim, Cartoon Network, among other media properties. It reaches about three out of four Americans each month, according to the company.
After the Time Warner deal, AT&T said it will expand as a media company and plans to launch a three-tiered subscription streaming service. It also has indicated it wants to grow its advertising business using AT&T customer data. Tuesday’s news shows its potential as an advertising force.
Traditionally, advertisers buy TV commercials based on demographic groups, like adults between the ages of 18 to 34. Xandr will let brands have access to its set-top box data, which will allow them to glean insight on more than 40 million specific households.
Companies will have more information on household purchasing behavior. They’ll be able to figure out which shows have viewers that match their ideal customer profile, like new parents or car owners. The information is passed on to advertisers in an aggregated manner, and AT&T customers opt-in to having their data shared.
Brands will also be able to use Xandr insights to reach more specific customers on Turner digital properties.
In addition, advertisers will also be able to create branded content and show it to AT&T audiences watching on internet-connected TVs and devices. Addressable ads combine internal and third-party data to find ideal customers watching TV via these methods.
Companies spent an estimated $64.2 billion on television advertising in 2018 according to MAGNA, while over-the-top advertising ー TV viewed without cable or satellite service ー was just at $2 billion. Addressable advertising budgets only reached $815 million. However, as more audiences cut the cord, budgets are expected to shift.
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