Sky plc (LON:SKY) and Virgin Media (LON:VMED) have joined forces in the targeted advertising market to level the playing field with Google and Facebook.
Virgin Media will join Sky’s Adsmart advertising network, which uses data from credit agencies to target more than 30 million TV viewers in the UK based on their age, location, income and other attributes.
“We're giving consumers advertising that is more relevant to them and giving brands a trusted destination to deliver intelligent, tailored TV campaigns to a targeted audience,” said Virgin Media chief executive Tom Mockridge.
Sky will benefit from the use of technology developed by Virgin’s parent company, Liberty Global, in targeting linear and video on demand TV advertising.
The pay-TV group is expected add up to 3.7 million homes to its network.
"Addressable TV is the high quality, brand safe and transparent medium that leading brands have already been adopting in their thousands,” said Sky’s chief operating officer, Andrew Griffith.
“Today's partnership takes that to the next level with the extension of AdSmart to millions more homes meaning more relevant ads for Virgin customers and a larger platform for advertisers."
How Sky's Adsmart network works...
Adsmart replaces standard commercial breaks on participating channels with more targeted advertising towards specific audiences, delivered to Sky's set-top boxes via a broadband connection.
Sky plans to use Adsmart to lift its sales to £1bn by 2020 from below £800mln last year. It hopes the tempt spending away from the likes of Google and Facebook, which have grown on the back of their ability to target specific groups of consumers online.
Sky has said Adsmart marked a major shift in the industry, claiming that the service makes TV advertising a more affordable option for small businesses that rely on local newspapers and radio for marketing efforts.
Channel 5, and MTV, owned by Viacom, have also signed up to Adsmart.
Sky and Virgin Media patch things up...
The partnership with Virgin Media is the latest sign of the two companies patching up their relationship after Liberty took over in 2013.
The two were at loggerheads after Sky derailed a Virgin Media takeover of ITV by buying a blocking stake in 2006. Sky sold its ITV shares to Liberty Global in 2014.