NEW YORK After three years in development, a venture capitalist-backed company has unveiled a new syndicated TV commercial testing platform that could have far-reaching implications for how clients, agencies and networks create and place ads, according to executives who have been involved in beta testing the service.
The Ace Metrix system launches today. It was developed by Steve Goldman, a former executive at Chiat/Day and BBDO, and market research specialist Ju Young Lee, who served previously at Lieberman Research Worldwide and Krumm & Associates.
Ace Metrix is essentially a Web-accessible software program that provides a near-real-time report on virtually all new TV ads in the top two-dozen categories such as auto, retail, packaged goods and movies based on the impressions of a nationally representative sample of 500 consumers.
Unlike conventional testing systems — such as Millward Brown, which can take weeks to research and assess new ads via focus groups and other offline techniques — Ace Metrix provides an online report for spots within 24-48 hours of their debut, according to the company and clients who have tested it.
The system evaluates dozens of variables across an array of demographic and geographic targets, but also asks panelists to provide their personal impression of spots. According to Goldman, more than 70 percent of panelists answer that open-ended question in detail, providing customers with a library of “verbatim” qualitative material to help assess ads.
The responses are crunched by proprietary algorithms that are used to generate an overall “Ace” score for each spot, as well as separate scores for individual variables.
Among companies that participated in the test phase were real-estate firm Coldwell Banker, Interpublic Group ad agency Deutsch/LA and CBS. Both Coldwell and Deutsch signed on as clients after launch. CBS and Ace remain in talks on a service agreement, said David Poltrack, chief research officer at the TV network.
Goldman said the new service has signed up several undisclosed clients as well.
Coldwell Banker, which spent $72 million on ads in 2008, per Nielsen, began testing the system six months ago and has decided to use it in place of more traditional and expensive ad services, said Michael Fischer, svp, marketing at the firm.
Timeliness was a key factor in the company’s decision to make the switch, said Fischer. “The real-time application makes it unique,” he said. With traditional services, he said, “Usually you have to wait for the vendor to put together the analysis, schedule a meeting and present the results. So by the time you find out how the spots are doing, the flight is usually over.”
Earlier this year, testing showed that two new-to-air Coldwell ads were effective, but more so with females, leaving men asking, ‘Where’s the meat?” said Fischer. That insight led the marketing team to introduce a new version of one of the spots that drove viewers to the company’s Web site to learn more about a real-estate tax credit.
Deutsch/LA has used the system to tweak ads in an ongoing new-business pitch for Honda Motorcycles, confirmed Mike Sheldon, agency president. Traditional testing often takes four to six weeks “and tens of thousands of dollars every time you want to test a spot. It’s too expensive and time consuming for most advertisers and impractical given the speed of business today,” he said.
Sheldon said Deutsch intends to use the system as a “value-added” service for clients. Agencies can also use it as a prospecting tool, to test ads in various categories and ferret out weaknesses, he said. (Other shops will have to wait a couple of months until Deutsch’s agency exclusivity deal with Ace runs out.)
Testing the system earlier this year, Deutsch was able to fine-tune ads for Dallas-based pizza chain Cici’s, developing a message using both brand image and pricing to appeal to viewers, said Sheldon.
At CBS, Poltrack noted that with the switch to commercial ratings two years ago, networks now have a vested interest in how much viewers like or dislike ad messages. “This measure allows us to look at the tuning and fast-forwarding patterns relative to commercial effectiveness,” he said. “It can help us optimize retention of ad viewing during the commercial breaks.”
And the nets can test their own promos as well, said Poltrack. “There is nothing as comprehensive as this” in syndicated form on the market today, he said.
That’s why Goldman and Lee decided to partner on the project three years ago. “We’re the missing link in the age of addressable TV,” said Goldman. “We can show how ads are performing and do it in the context of competitors as well. [With the Ace system] marketers can adjust on the fly.”
Goldman and Lee initially put up $300,000 of their own money “and started knocking on doors,” recalled Goldman. “And people kept asking us, ‘Why hasn’t anybody done this before?’ Then we ran out of money.”
Last August, two West Coast VC firms – Hummer Winblad and Palomar Ventures — invested and helped set up the system for launch.
“We knew there had to be better way to test ads,” said Lee.
Starting today, the rest of the industry can judge for itself whether they found it or not.