Programmatic advertising has certainly caught fire in the digital advertising space. But when—if ever—will it become the norm in TV? We spoke with Doug Hurd, co-founder and evp of business development of TV ad tech platform clypd, about this topic and others related to the future of programmatic TV.
How long until programmatic advertising in television will become the norm, across agencies and media companies?
Growth predictions for programmatic TV is very much dependent on the definition of programmatic advertising for television. At clypd, we focus on two core components—activating advanced data sets and automating the transactional workflow. In TV, some of the digital concepts (real-time bidding and open exchanges, for example) are less pronounced and the focus is instead on data-driven TV transactions that are facilitated through sophisticated software platforms. This is increasingly becoming the norm as media owners and media buyers work together to increase the use of advanced data in their transactions.
What are the biggest challenges to the adoption of programmatic in the TV space?
Challenges can occur if companies are trying to replicate programmatic advertising exactly as it exists in digital into TV. In digital, there exist various standards and systems for automation, impression level targeting, viewability, and attribution. In linear TV, the media owners’ systems and the media sales processes and workflows are significantly different. There are no ad servers, ad tags or cookies. To provide automation, platform integration is necessary with order management systems, traffic and billing systems, ad copy and distribution systems that are disparate and often antiquated.
Some of the challenges to adoption are due to a lack of industry standards that hasten automation. Other challenges exists when it comes to data—what data sets are acceptable for currency and what data sets are acceptable between the buyer and the seller when it comes to advanced audience targeting. However, much progress has been made and the automation challenges are being solved through API integration and specific data sets are emerging as the preferred choice by both the media owners and media buyers for advanced audience targeting.
It has been said that the ad tech component has not reached a point where consumers are enjoying their ad experiences in the digital space. How can advertisers improve upon that experience?
Advertisers are improving the ad experience in the digital space with better targeting, better creative and by leveraging the latest advancements such as programmatic native advertising. As a company that provides software tools that help media owners in TV optimize yield and sell advanced audience targeting, we help bridge the gap between digital and linear TV advertising. The good news is that more and more data is being leveraged by the buyers and sellers of TV. This helps advertisers reach their target audience with less waste, media owners optimize yield, and most importantly, these data sets when combined with tools for automation, help to deliver a better experience for viewers.
How important is addressable advertising? What are the latest technologies to target audiences?
Addressable advertising (in TV) is an important enabler for advertisers that wish to reach consumers at the household level. For example, a home with four children, a dog and a minivan in the driveway might see a different ad from the couple in the neighborhood with no kids, a fish tank and a Mercedes convertible in the garage. Unfortunately, addressable TV is limited in scale. TV commands the lion’s share of overall ad spend, averaging $71B+ in the US alone. Roughly 20% of TV inventory is addressable, so scale remains an issue. Thankfully, there are solutions in the market today that provide advanced audience targeting on linear (non-addressable) TV inventory. This technology models a media owner’s entire TV schedule and determines the programs that over-index against the advanced audience segment.
Since programmatic is in part automated, how do you suggest best combatting ad fraud online?
Thankfully, fraud is not an issue in traditional linear TV advertising. However, the convergence of traditional TV with digital video calls for integrated workflows. Platforms that integrate the workflow and provide the translation between TV and digital will be an essential part of the ecosystem. These platforms will need to communicate with and support the various technologies that are being developed to protect against fraud.
How will advertising in the cross-screen universe look in the next few years?
Many of the demand-side platforms (DSPs) are solving for the cross-screen in digital today. Advertisers can define an audience target and reach them online, on mobile devices, laptops, tablets or PCs. Until recently, reaching that same audience on TV has been a challenge. With the advancement of sell-side platforms in television and the broader availability of panel data fused with consumer data and set-top-box data, advertisers can now reach that same audience on TV. In the next few years, the sell-side technologies will advance even further so that media owners in TV can calculate reach/ frequency, optimize yield, measure and price their inventory across digital and linear through a unified platform.