Is Programmatic TV Bound to Happen?
We can all agree that cross-channel marketing works. When you combine cross-channel with audience driven programmatic buying, it becomes even more powerful. Unfortunately, we can’t have true cross-channel marketing until TV becomes programmatic.
What is Programmatic Buying?
The reality is 72% of publishers and 85% of advertisers use some form of automated buying according to a recent IAB/Winterberry group study. Within the next two years, 91% of advertisers are expected to use programmatic buying.
I was amazed when I read in Advertising Age that roughly 23% of marketers don’t know exactly what programmatic means. Raymonde Green, VP, Director of Media Activations and Partnerships at Digitas explained it well when he said, “Programmatic is essentially the center of your demand side and your buying side. It’s putting information in front of the right person at the right time, taking into account all the individual needs and data points of that particular person.” Programmatic buying uses software automation to do just that.
Filling Programmatic’s Potential with TV
According to Natalie Bokenham, SVP Managing Partner at UM WW, 75% of television spending tends to hit the same 25% of an audience repeatedly. This shows the need for improved budgeting and varying linear TV spending. “We’re finally getting to the point where we have the technology and the interface to bring traditional linear TV to programmatic,” says the vice president of business development at Cox, Mike Zeigler. “Legacy systems are focused on scheduling 30-second spots in a traditional fashion, but now we can do it in a much more automated manner.” As more marketers see the advantages of data-driven marketing, they also quickly notice the lack of TV inventory on programmatic exchanges. This shows a large gap in their cross-channel marketing plan. Since TV is still a large part of most marketing budgets, when it comes to planning, buying, and analytics, TV is running behind.
TV has incredible potential for cross-channel marketing success. However, marketers need access to the inventory from cable companies, broadcasters, and networks to make it happen. This will give marketers the insight and analytics to measure campaign performance as well as gain insight from cross-channel optimization. The demand for TV to join programmatic already exists, with an estimated $35 billion a year being spent on U.S. TV advertising. Marketers want to be able to plan and buy all of their media using the same platform. The technology already exists to automate video, social, mobile, and display advertising. “Integration of TV into programmatic requires some legwork on the backend, but the framework is in place,” says Paul Alfieri on Ad Age.
“They want the insights and analytics they need to run true cross-channel campaigns. They want to target audiences at scale, and bring those audience segments into the TV world. What the networks don’t seem to realize is that TV will also benefit from change, when the application of audience data to TV drives higher prices for traditionally low-interest inventory,” says Alifieri. Unfortunately, the adoption of programmatic TV tools has been rather slow. It is feared the programmatic will devalue ad time. “If programmatic creeps in, then it could open the whole system to selling ads in auctions, just like online where the highest bidder wins, the thinking goes,” says Garett Sloane on Adweek.
It will take time for TV to fully change and reengineer areas like backend operations, scheduling, and ad trafficking. However, in time, we believe TV will become programmatic-bound.