What Performance Really Means For Local Media

For decades, local media sellers could demonstrate success through ratings, reach and frequency. But advertisers, particularly small businesses spending their own money, are demanding something more concrete: qualified leads, store visits, purchases, and other measurable business outcomes.

In the latest episode of In the Vicinity, Tim Hanlon sits down with Madhive CEO Jim Wilson to look at how that shift is reshaping local advertising. Wilson explains why CTV is inherently a local performance platform, how AI can identify which audiences are most likely to convert at the ZIP-code level, and why optimizing the media buy is no longer the ultimate measure of success.

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Tim Hanlon: Hey there, what's going on? You're In the Vicinity. Welcome to the proceedings. My name is Tim Hanlon, and this is our little weekly sojourn into all things local media. Thank you for finding us once again. Hopefully, you've been enjoying our previous episodes and telling your friends and having them tell two friends and so on.

My name is Tim Hanlon. I am the founder and the CEO of the Vertere Group here in Chicago, where we do a lot of consultatively advisorial work in and around the media and technology spaces. Happy to have you aboard, and we're also happy to have Jim Wilson back. Trying to make him a monthly presence here on this show.

It's been a little longer than a month since we last chatted, but exceedingly happy, of course, to have him back. Jim as the CEO of Madhive, as well as board director of companies like GSTV and the audio/radio company known as Audacy. And we're gonna kinda get into things around this word, performance, this week.

The reality is that so many brands and so many advertisers, whether they're local or national or regional or whatever, are just not only overwhelmed by the various media channels that are available to them and how discreetly focused or targeted they can be in those. But also having to think about them in a very horizontal kind of manner, where all of them work in concert with each other to generate some kind of activity.

Usually a sale is always the highest order of that. But other things too, qualified leads and store traffic and other indicators that the advertising at least is working on some level, if not for a full-fledged sale or initiation of a customer relationship or that kind of stuff. And that's what we're kinda gonna dig into here this week, is this sort of performance element that forces a lot of local media sellers and advertisers to rethink what it is and what it means to buy media and to do, quote-unquote, advertising.

Not only are there so many different touchpoints out there, but they all need to be planned for and measured and optimized in concert with each other. And that is a huge Pandora's box of challenges as technology, process, and people have to kinda come together to make that kind of stuff happen with modern success and reliance, frankly, for marketing budgets.

So we're gonna get into the performance angle of local media. And here's my conversation with Jim from a couple of days back. Please, as always, enjoy.

Hello stranger. How have you been? 

Jim Wilson: You blink and it's fall. Today doesn't seem like fall, it seems like summer again, but here we are. It's fall, and we're, what? We're on the eve of Advertising Week, then we are going to be at NAB. So yeah, it's a busy time as usual.

Tim Hanlon: We've been trying to keep you on a monthly cadence, so hopefully we can get you back a little bit on the wagon after this one, because I think it's been about six or seven weeks.

But that's okay. You're busy. You're busy running a company. It's fourth-quarter time now, and there are numbers to meet, and investors to impress and all those things. But one of the areas that we've nibbled around in previous conversations, both with you and separate from you, has been this dynamic around how local media and local marketing opportunities not only continue to grow and morph and battle or embrace digital technologies, but also as the sort of outcome kind of dynamics of things.

And this word performance has quickly gotten into the lexicon for all forms of media. But I thought it was a good opportunity to delve into this topic, this dynamic with you as it applies to local media. And I guess I'll set up the question this way. Media sales is very funneled and very channeled and very siloed, I guess is the better word.

You're judged on how well you sell your inventory in your particular vertical or sub-vertical. But when you inject a word like performance, you're bringing in a holistic view that as an ad seller, as a media seller, you're not necessarily in control of, per se, or at least historically. So if I'm a seller of media or other marketing avails, shall we say, how should I approach the idea, this word of performance, when in some respects I'm only maybe one hand clapping in my approach to the marketplace? 

Jim Wilson: Yeah. Local sellers have been selling digital for quite a while. Certainly, they are very adept at selling linear, but digital has always, I think, been a performance play or should have been a performance play if it wasn't.

The local market certainly has its fair share of the concept of reaching a broad audience, so reach and frequency. And so it's through digital and it's through the tactics of digital where you could need to start tying reach and frequency to an outcome. And so local has gotta be, without a doubt, it has to be synonymous with performance because, whether it's CTV, whether it's digital out of home, the idea for a local advertiser, many of which are destinations, the idea is to drive an outcome, right?

And that's really what is going to get an advertiser to come back. If I am a local pizza shop, if I'm an auto dealer, how am I measuring success? Reach and frequency are measures of success if you're thinking about the top of the funnel. But really at the end of the day, it's really increasingly about the bottom of the funnel.

Tim Hanlon: And that's an interesting thought because when you get down into the weeds of the process of going out and meeting clients or potential clients, and making the pitches and making the sales, and all that kind of stuff, I think in every AE's mind, every salesperson's mind they kinda look at performance as, not only am I selling inventory, that's performance, at least internally.

But, if I'm selling linear media inventory, performance is what? A Nielsen rating and those kinds of things, right? I think our terminology, and generally terminology, and I wonder how much of it is filtered down to the rank and file and people who are actually making this stuff work and happen, understand that performance is a multivariate, more complex tableau of occurrences and things that happen, right?

And to your point, some of those can be like direct sales, but frankly, there's a myriad of things that are also performance-based that are not a full sale per se, but maybe the beginnings of such, right? A qualified lead, and those things are also valuable too. So I guess my question really is how much do you think that evolved understanding has trickled down through most of the traditional local media purveyors out there, or does it still have a ways to go in terms of permeating the sales process?

Jim Wilson: No, I think it's a real key part of the sales process. I think if you're thinking about local media companies, right? I've been around for now about 10 or more years, and I've seen this evolution of local media companies where, when I first started Permion, there was a linear market, and we wanted to bring a CTV product to market.

And so CTV was looked at as a companion to linear. If eyeballs were shifting to a new platform, we wanted to make sure that we had a converged sale between linear and CTV so that we could shore up impressions and make sure that we were reaching the audiences that we wanted to reach. But broadcasters have become increasingly sophisticated over the last 10 years, and have trained their sales teams around selling digital and selling outcomes because that's what their clients are looking for.

Their clients are looking for outcomes. Every client wants to make sure, and I think some of the smartest buyers out there are small businesses. And so it is coming out of their pocket. They're pretty demanding on performance. They want to drive an outcome that is related to what they do, whether it is a qualified lead or it is a cash register receipt.

And so broadcasters more than ever have become more sophisticated around going in and selling that. And what we're doing is creating tools and we are making it easier than ever for salespeople and or agencies and brands to look at outcomes at the local level. And, we feel very strongly at my company that national campaigns should really be broken down into local campaigns because we are not an average audience across the country.

We are a myriad of ZIP codes with different audiences. And frankly, we're working on campaigns where we rule out ZIP codes because we don't think the outcomes exist in those ZIP codes. Madhive has developed so much intelligence over the last 10 years of being in business, and then when we acquired Frequence, we acquired 15 years of intelligence.

And so we have so much intelligence around audiences that exist in ZIP codes. I always say we look for and find a needle in a haystack in a ZIP code, and now we need to convert that needle to an outcome. 

Tim Hanlon: Do you think CTV has maybe hastened local marketers or local businesses' understanding of the need for performance?

Because the whole CTV proposition almost from day one has been more performance-based and outcome-based than linear TV ever was. 

Jim Wilson: CTV is digital. It's a performance platform because it's digital, and frankly, in my mind, it's a local platform because it's digital.

Tim Hanlon: It's also, not to interrupt, but it's also television delivered digitally, right? That's kind of the weirdness of it. Because local television has been understood for decades. But now you inject this idea of not only measurability but performance via this permutation called CTV.

That seems like that could go either way. But I tend to think that you see it more positively than glass half empty. 

Jim Wilson: No, I see it very positively. I see streaming television as a performance platform driving outcomes and a local platform. Anything streaming. Streaming audio is the same thing. We are able to target messages to different audiences in different ZIP codes, and are increasingly adjusting creative for, and optimizing creative for audiences and ZIP codes.

And also just to differentiate yourself in the market as a content company, whether you are a broadcaster, you're a streamer, there's a lot of content out there. And so there are a lot of streamers out there, there are a lot of shows out there. There's long form, short form. You can get the reach that you want, you can get the audiences that you want almost anywhere.

Now what we're trying to do is be incredibly intelligent around who we're reaching, where, at what time, and driving what outcome. And we look at billions of signals now when we're looking to deliver outcomes for a client. We're in a ZIP code. We'll look at so many different signals, and constantly adjust to make sure that we are finding the right audience for a conversion.

And oftentimes we have clients that think they're looking for one audience, and then we find other audiences that will convert better for them within a ZIP code because we're constantly crunching. And the power of data science and ML and AI, especially at the local level, is the ability to look at so many signals instantly in order to consistently adjust campaign performance to optimize it.

And I think that's the really exciting part about what we do, and why, again, why I love local so much because local, I think, demands performance. It has to be about performance. 

Tim Hanlon: How broadly applicable, though, is that data crunching and that signal finding with respect to who's conducting it?

From a Madhive perspective that's probably the best expression of how one can do CTV on a local or regional or hyperlocal level better, faster, stronger, and constantly, right? But where and how does that overlap or commingle or combine with the similar data signals that are coming from other local media that happen to be digitally infused?

Because they're gonna probably wanna signal crunch and analyze based on making their particular media come out better. There's a neutrality question in there, how much or how little. And there's an interoperability or commingling of that information. So you may be in a dangerous spot in that you guys are doing such a tremendous job in being able to do that.

But what of all these other touchpoints and stuff too? Do you add those into your recommendations?

Jim Wilson: Yeah, and remember we're completely independent. We access content from local broadcasters, their digital inventory partners that work, we're their infrastructure partner. We are first and foremost working with our broadcast partners to ensure that they are monetizing their digital inventory.

We at the same time then look at other sources of content to make sure that content will provide the audience reach that they want, but ultimately the outcome that they're looking to get. So we're ultimately measuring the success of all the platforms. And we've made recommendations to certain clients, one in particular, about the outcomes of their content versus outcomes that we can get elsewhere.

So ultimately they need to make a decision. It's their decision. If we're working with a local media company or if we're working with an agency, we will objectively provide the reach, frequency, and outcome for a channel or a partner, and we seek to optimize that. Our goal is to optimize the performance independently.

And the good news is we have the ability to look at it, either their content or other content, because ultimately we all kinda wanna work in the best interest of the advertiser and make sure the advertiser is getting the outcome that they want. If they don't, the client will go somewhere else.

Ultimately the client has a lot of options, so we're here to make sure that we're maximizing the outcome. So we at Madhive are completely independent of that. 

Tim Hanlon: Are there any laggards though in the local media ecosystem that you work with and behind at Madhive, whether they're partners or not? Because you wanna get all those data signals and be able to have that quality information, that quality recommendation to optimize and make adjustments and that kind of stuff. But I could also imagine certain forms of media in, maybe it's by marketplace or by market or form factor, frankly that is not at a level perhaps of where Madhive is or some of the CTV pure players are or even any of the digital players are, yet there's still media properties as well.

How do you get everybody up on the same level in terms of accessibility for marketers to take advantage of when some of them are still behind the curve, if you will, on the sophistication needed to generate and measure even signals. 

Jim Wilson: Ultimately we built tools to do that. Backed by 10 to 15 years of data, backed by real-time crunching of signals in the moment, we are looking at the potential success or the success of campaigns. When you say laggards, though, are you talking about our clients or our tactics, or what would you define exactly? 

Tim Hanlon: Read more as the media vehicles, right? Or, and you probably can bunch those up by category, right? Broadcast television stations, direct mail providers, out-of-home companies. All of them in their own manners of evolving, shall we say, and maybe aren't necessarily, running as quickly as you might want them to in terms of universally seeing where all the best signals are to take advantage of.

Jim Wilson: Yeah. I think broadcasters have come a long way in terms of where they are, like I've said. I think that CTV without a doubt has blown up in the last five years, so it is still the tactic, I think, or channel that everyone is chasing. Now it's increasingly moving, as we said, from reach and frequency to performance.

I know that some of our clients are shifting dollars from traditional digital tactics, maybe OAB display, towards CTV, because CTV has now proven itself to be such a performance platform. We have had some really incredible growth from some clients this year, and when we inquire about whether the client is spending more or are they just shifting, the answer is they're shifting. They're shifting to CTV as a performance tactic. And look, I'm a huge fan of audio and podcasting, which is becoming more and more relevant in the space that I'm in, local. As a board member at Audacy, they are doing incredible work and really breaking new ground in their business and growing their business.

Tim Hanlon: Podcasts are just as confused with video. Just the same, right?

Jim Wilson: iHeart's doing amazing work. And so they're all doing really amazing work around the growth of the audio space, and we're seeing that demand on audio coming from other clients, looking at audio and podcasting, streaming audio and podcasting as a performance platform.

And we're seeing that. We focused a lot on that this year. And then digital out-of-home is incredibly interesting to me. Again, I'm on the board at GSTV, and GSTV has pivoted this year from basically a branded sell and content in locations to a performance play, right?

Think about it. What are you doing when you're filling up your car or you're at a convenience store? You're on your way somewhere, and we essentially can figure out where you're going, and basically the goal is to serve a campaign and deliver an outcome because you are out and about. And then if you can kinda connect that back to CTV or connect it to a retail media network, you're really closing the loop.

There's so much potential for digital out-of-home to become a bigger player in the performance space. And frankly, when I ran Talon, I always say my wisest decision was going out-of-home in March 2020 when COVID happened. So I always say everyone was going to the comfort of their living room while I went out-of-home, but it was probably one of the best experiences of my career because we needed to take a bunch of branded campaigns, and one example is we were basically launching Wendy's breakfast campaign and immediately pivoted to getting people and measuring people going through drive-throughs.

Because how did you get food during COVID? And that was an incredible experience. And so we know the power of performance in out-of-home. And I think out-of-home and ultimately just so you know, within out-of-home, I think one of the big drawbacks and holdbacks is there isn't a common form of measurement.

There isn't a common form of currency, and when the industry gets its act together in those regards, it's gonna be great. Having been inside the industry, and now being outside the industry, I feel like as a net buyer of the inventory, perhaps we can help create more opportunities for out-of-home companies to be a part of not only the performance sale, but also the local sale.

Obviously there's companies like Lamar and Outfront. Both are amazing at local sales of out-of-home, but there's still a significant amount of out-of-home inventory that doesn't have access to local, and we are working on making that happen because, local's a $186 billion market now. 

Tim Hanlon: Let's round up this topic then, at least for now, with sort of this kinda general hard think. How would you describe marketers versus local media properties in terms of who's ahead and or maybe driving the performance conversation? Because a lot of what you're describing is, it's gotta shake the media folks a little bit because the more marketers get sophisticated, the more proprietary I think their needs and wants are going to be.

And that's a harder solve, I think, for most traditional or classic media sellers, even with all the data, because there's no Nielsen or a third-party arbiter, so to speak, as to what was, quote unquote, working or not. I guess the point is, in the eye of the beholder, in the case of the marketer where the budget's coming from, do you sense more of that performance outcome success is going to be predicated on proprietary mixology from the clients?

Or is there a way that media companies can either do the same or maybe somehow lead the conversation instead of it being foisted upon them by marketers? 

Jim Wilson: Marketers, without a doubt, are leading the charge on performance. Marketers have data sets that they are working with that they want to put into action.

And so I will say that we do the same. Maverick's intelligence platform is about making insights actionable for our clients. I think, and again, we are a local intelligence platform at Madhive, and increasingly what we're being asked for, from holdcos to regional agencies to brands directly, is how can your local intelligence help us transact and increase performance? How can we put our data sets together with your data sets to enrich the ability to reach the audiences that we wanna reach and increase performance? And frankly, it almost feels like it's universal.

Again I really feel like broadcasters overall have really caught up to this, and that the sales teams and the sales leadership across the local media companies have really advanced, some more so than others. But overall, I think, in the local media broadcaster space, there's been a significant shift toward digital performance and their ability to differentiate in the market.

One, they're competing against each other, these local media companies, but in the bigger scheme, they're really competing against walled gardens like Google and Meta, and they're now competing against other streamers that are basically where local advertisers can get access to inventory. Although less honestly, than, the Metas and the Googles.

But I think they're all driving it. Look at all these data acquisitions that are happening now, right? All the holdcos have made acquisitions in data, and so data is a real hot commodity. And again, we feel like the intelligence and insights that we built are specifically focused on local.

We can tell you, again, the attributes of ZIP codes by category, by audience, et cetera, and, the likelihood of outcomes within that. And remember, at the end of the day, if you have access to a pixel and you have access to data and intelligence, and then you can tie them to third-party measurement companies that are looking at cash register data or any other type of indication of an outcome that were attached to all of those.

Madhive's been in the performance game for a long time. Even when I was back at Premion, we were in the performance game, and performance is much more than reach and frequency. It has to be delivering the outcome for that specific advertiser. 

Tim Hanlon: So it's not optimizing a media buy anymore. That's not what performance is? Is that what you're saying? 

Yeah, and that's a big move for a lot of people who grew up in the media industry to local or otherwise, right? And that's where the proof is in the pudding. That's where the dollars really show whether things are working or not.

Jim Wilson: Let me just draw a quick analogy. Sure. I was at curriculum night at school last night, and the chemistry teacher basically said when the kids come into the room, first of all, she never assigns homework anymore. And when they come in the room, there's no devices, it's only pen and paper.

They are doing chemistry with pen and paper. Because she knows that if they go home and do it, there's a high likelihood that someone else, could be a tutor, could be a parent, and increasingly could be AI, that does the thinking for them. In that case, maybe that's not so great, because we're not teaching our kids how to think.

But in the business world, if I can hand a tool to a seller, not that they don't think, but I can hand a tool to a seller where a lot of thinking can happen for them in a quick amount of time, that can look at what an advertiser's trying to accomplish, what they've accomplished in the past, what they're trying to get in terms of an outcome, which channels typically work better for that outcome, which audiences will convert faster, read signals on the bid stream to see that happens, that's a pretty good outcome ultimately.

And so we can easily equip a local advertiser, a local seller, a local agency, and a national agency, and a holdco, and a regional agency, and a national brand with this type of information right now. And so the world of performance has really been heightened by the existence of AI, and the ability of, and machine learning, to crunch data more quickly, and to be able to serve it up real time, in the moment, with a client.

And then basically to deliver that sale, convert that sale, and keep that client. Because there is one big thing within the local media companies, there's a lot of churn. And so what we're really focused on as a partner to all the broadcasters and local media companies is to give them the tools to increase revenue in the top of the funnel, but to make sure that they reduce churn. And you will minimize churn if you're delivering an efficient campaign with an outcome.

Tim Hanlon: All right, there it is. Our thanks to Jim, and we'll see him next month-ish. And we'll see you hopefully next week. Before we go, we wanna say, of course our great thanks to the folks at Madhive, whose financial contributions help keep this show going, as well as the team at TVREV without whose work we couldn't do this show.

And they know who they are, but you should also know them, too. Melissa Hourigan, Mike Gasbara, Jason Damata, and Jessika Walsten, among the many merry band of folks there at TVREV. That's tvrev.com to check out their various activities. Of course, the great Jerry Payne, the Atlanta Braves super fan down there.

Thank you for your audio excellence again this week, and continued good luck, but not too much, in the Major League Baseball playoffs. And thanks for listening. We'll see you soon here In the Vicinity.