The Banking Upstart Chime Thinks TV Ads Can Work Just Like Meta
Avoiding the "DR Valley of Death"
There has been much hope, and much debate, over whether ad targeting and measurement on TV can become as good as, or even better than, the web.
While many ad tech cheerleaders are expecting a wave of direct-to-consumer brands coming to streaming, a speaker at a recent conference I attended gave a blunt rebuke: “TV is not a performance medium. It just isn’t.”
Well, the digital banking brand Chime says the performance potential of TV advertising has actually been undersold. In fact, Nick Fairbairn, VP, Growth Marketing, Chime, thinks CTV could end up as effective as Meta, the ultimate closed-loop, perfect attribution, walled garden.
I had Fairbairn and Andy Schonfeld, Chief Revenue Officer, Tatari, on Next in Media this week to talk about the millennial-aimed fintech brand’s multi-year journey to break out of the “DR Valley of Death” and make TV as accountable and effective as possible - including a heavy dose of linear.
“As we were a startup, we would raise money and pump it right back into the walled gardens in exactly where you think it would be, in Facebook [and Google],” said Fairbairn. “Of course, 80% of your spend is in those two places and it’s working amazingly and your company is growing. But if one of those two things stops working, you know, we’re screwed.”
So Chime started talking to Tatari roughly six or seven years ago, when CTV was still fairly nascent, and the broader television ad market was less accessable.
“There was a barrier to entry for most brands,” he said. “One of the first barriers is, it’s going to be too expensive. I’m not going to have the money to make a spot. I’m not gonna have the money on a monthly basis where my budgets aren’t big enough to play in this space.”
Yet at the time, Tatari was starting to help smaller brands break into linear TV via cable and less pricey dayparts.
“We were able to do with Chime and others was take brands at small doses onto TV and be able to drive [spending and optimization] just like Meta and how they think about these other channels from an incrementality and attribution standpoint,” said Tatari’s Schonfeld. “And the more that they see the performance actually working, whether it was through our data or their own internal data, the more they wanted to invest.”
Then, thanks in part to the pandemic, streaming, and eventually ad-supported streaming, started to take off, opening up far more inventory for Chime.
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The idea was to work from the bottom of the funnel up, while figuring out different ways to measure the value of TV exposure from a performance point of view.
“We wanted to avoid the DR Valley of Death,” said Fairbairn. “You can only squeeze so much of that demand if you don’t create it, right? And that looks like premium airings, live sports, sponsorships, things that are more expensive that are traditionally thought of as more branding in nature, but they can be measured as performant. They just have to be measured differently and over a time horizon.”
“I think the challenge we run into with a lot of brands is they get caught up there, it’s like there’s that period where you have to be able to stomach two, three, four months of, I don’t want to call it pain, but it’s just you have to be able to be a step back and say, ‘okay, we’re gonna commit to this, we’re gonna buy a certain way.’”
Check out the full episode here: