Starcom MediaVest Group (SMG) and DIRECTV, a video service, have an agreement in principle for SMG to assist DIRECTV in delivering scaled, household-addressable advertising to customer households with DVRs. The deal, the first of its kind on a national level, will allow SMG to be the first agency network to provide its clients with the ability to address highly relevant advertising messages, including the right to be the first to identify the audiences that best fit their clients’ needs for addressability. The agency will also serve as an advisor to DIRECTV to help enhance and refine the service, a role SMG has played for many early trials.

"This is a glimpse into our industry’s future. Up until now, we’ve only been able to test the power of addressability in local markets. We proved its value beyond a shadow of doubt, but hadn’t yet conquered scale until now," said Laura Desmond, CEO of SMG, whose clients include some of the world’s most influential marketers including Procter and Gamble, Coca-Cola, and General Motors. "As a result of this partnership with DIRECTV, we can now invest our clients’ dollars in addressable messaging at the national level. We believe this is the tipping point, an entirely new marketplace is being created and shaped that will increase marketing effectiveness."

According to Tracey Scheppach, SVP/Innovations Director at SMGx, "At SMG, we’ve run the numbers and feel confident that the creation of a viable national addressable platform can infuse $10 billion in incremental revenue into the television marketplace as its appeal is universal and has the ability to bring a whole new class of marketers to the medium. It’s taken years of hard work to get this far, but we’ve got light at the end of the tunnel and we’re ready to put our money on the table."

"This partnership with SMG will create a whole new revenue stream for DIRECTV and ensure that our viewers are being served up with ads that are relevant to their lifestyles," said Bob Riordan, senior vice president, DIRECTV Advertising Sales. "It’s a win for DIRECTV, advertisers, and our viewers."

As part of the advertising deal brokered by SMGx, the trading and innovation arm of SMG, media agency’s clients will be able to segment their ads on a national level to selected consumers based on multiple factors including geography and customer segmentations, as well as third-party sources and the marketers’ consumer databases.

The consulting segment of the SMG/DIRECTV relationship begins immediately, with the addressable ad technology set to begin testing in 2011. After testing is complete, DIRECTV will deploy household addressable advertising capability to the nearly 10 million customers expected to have DVRs, with 25 of the top-rated cable networks.

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