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The Future of Programmatic TV

Chris Dobson, executive chairman at The Exchange Lab, and a speaker at this year’s Festival of Media Asia Pacific in Singapore, considers the potential of programmatic TV.

The introduction of the television set changed the way people consume media by bringing the written word to life and allowing viewers to see, hear, and share emotions through visual entertainment. The engagement and emotional connection holds the same power today, but now takes place across multiple screens.

Looking at the media landscape, digital media’s share of ad spend is predicted to continue its growth trajectory and by 2018 will overtake TV for the first time. Digital advertising has embraced technology and programmatic ad trading, and now TV must look to do the same to retain its revenue share. So what are the key considerations for marketers?

Connecting media past with media present

Traditional television advertising lacks the data-based predictions that help plot the customer journey so efficiently within digital. To stay relevant, TV must evolve. Consumers today digest content across multiple screens, which means brands and advertisers have to work harder to reach the right audience, at the right time, and in the right place.

Connecting the worlds of TV and digital media means there is a much wider audience available to digest video content. Thanks to streaming media companies such as Netflix and Amazon Prime, the way video content is consumed has changed. TV networks are moving from linear methods to a more ‘on-demand’ approach, releasing content via online streaming services and in-app video players.

Social feeds such as Twitter are constantly buzzing with commentary around TV programs, creating ‘live’ consumer interactions that would have traditionally been reserved for personal conversations.

Using data for TV

Through more robust data sources such as cable subscriptions and individual user sign-ins for content services like Netflix, brands are able to gain a greater understanding of customer behaviour across devices. Programmatic technologies empower marketers to react to real-time events by providing actionable insights. Using audience demographics, programmatic automates manual ad buying processes and offers brands the chance to buy ads in advance or in real-time, more efficiently, with more precise targeting.

Programmatic products such as TV Sync use technology to enable the amplification of TV advertising through digital data sets, allowing brands to interact across all touch points and screens. For example, a competitor may broadcast an ad on TV and in response; its rival brand serves an ad on a viewer’s tablet just moments later.

Viewability as a metric

Viewability is the one constant concern since advertising began; print, outdoor, and TV are no different than digital when it comes to the challenge of determining who is consuming an advertisement. There has never been 100% viewability for TV – just the same as other channels – although one of the benefits of programmatic and data-driven advertising is increased accountability. Newly suggested MRC audience metrics based on gross rating points (GRPs) are, however, one further stepping stone to TV-style ad pricing in digital, offering a possible solution to a universal viewability metric across media.

Barriers to programmatic TV

A significant barrier for adopting a programmatic approach in the television industry is the current view of ‘us’ versus ‘them’. TV executives need to be convinced that real-time bidding (RTB) can drive an increase in yield at peak times as well as down times, and that its processes can improve and enhance the well-established trading model currently in place. But what was once a static price for inventory is now fluid. Moving forward, the market should decide how and when to buy inventory.

So far this year, we have seen the first TV programmatic bidding process with Mondelez and its Super Bowl ads for Oreo and Ritz, albeit in advanced auctions. This is the first step to true bidding automation in television and where one brand begins, more are sure to follow.

The future of TV

TV and digital are not so different after all. Both enable brands to connect with their audiences emotionally and although digital offers audience buying at a more granular level, television will soon fall in line.

Programmatic technology is the connective tissue between brands and consumers and is an inevitable part of the future of TV. The desire to integrate across multiple screens and de-silo media planning will eventually push the convergence of the technologies. It is simply a case of ‘when’ and not ‘if’ it happens.