Programmatic TV: Merely Possible, or Actually Simple?

June 25, 2015

addressable-tv

In a product roadmap meeting the other day, Blane Sims, Signal’s SVP of Product, made an astute observation:

That seemed like a very useful benchmark for testing out new marketing trends and technologies, so I thought: Let’s test it. This post is the first in a series where I’ll look at new digital marketing tactics that have marketers buzzing. In each post, I’ll answer: Is it merely possible, or is this tactic truly easy for a marketer to pull off?

To kick off the series, let’s dig into programmatic television advertising.

What is programmatic TV?

As defined by the IAB, programmatic is the automated buying and selling of digital advertising inventory. Programmatic transactions can include many different types of technologies, including the most well known: real-time bidding (RTB) which is a way for transacting media that allows an individual ad impression to be put up for bid in real time via a programmatic on-the-spot auction.

Programmatic TV is often confused with addressable TV, which allows advertisers to display specific ads to different audience segments or viewers based on demographic, psychographic, or behavioral attributes from known customer profiles. Learn more about addressable TV here.

Is it possible?

Yes. The emergence of connected devices and televisions such as Roku, Google Chrome, and Apple TV have made it possible for applications to be accessed through the biggest screen in the home. And where media is consumed, ads are sure to follow. This is complemented by the growing adoption of buying platforms used for real-time bidding, where marketers can log in to a user interface and make changes to how, what, and to whom they’d like to advertise.

Is it easy?

Not yet. In the television context, “programmatic” means that a buyer no longer has to call their television station sales rep to get an ad on TV; instead they can just place this buy through an online tool. But programmatic television does not have all of the tactical characteristics typically associated with “programmatic,” such as real-time bidding, customer-level data targeting, and automated optimizations.

Why is that? Why don’t TV advertisers have the same programmatic controls that they do with programmatic digital advertising?

Lack of maturity and scale in the programmatic TV market. Fewer people are cutting the cord on cable and satellite subscriptions than initially advertised, which means the number of people consuming television content on a television screen via their connected devices isn’t large enough to bring uniformity to the medium. The result is video ad placements aren’t quite standardized across platforms yet. And, like mobile, connected televisions operate in a cookie-less environment, making it difficult to target at the customer level.

How should marketers approach programmatic television?

Inventory availability and comparable campaign metrics are still developing in the programmatic television landscape. So comparing programmatic television ROI to traditional television ROI will show lower performance gains than desired.

Leading advertisers will always want to be on the cutting edge. When testing programmatic television advertising at this stage, a brand’s goals should be to provide unique brand experiences to its customers, and better understand the return on ad spend in an addressable environment as it relates to conversion and the customer path to purchase.

The Result: Possible, But Not Easy

So there you have it. Programmatic TV advertising is possible, but not yet easy for marketers to adopt as a key tactic. Its prospects are looking pretty good, though, so don’t count out programmatic TV yet.

blog-banner-open-platforms