What is Programmatic TV?
We recently took a deep dive into the topic of programmatic advertising, offering insight into how technology and data-driven approaches are changing – and enhancing — the way advertisers and publishers transact. Programmatic isn’t just transforming video advertising, it’s also making in-roads into how advertisers can buy linear TV with more audience targeting precision. What is programmatic TV? And how can this tech-driven approach to television buying benefit advertisers?
In short, programmatic TV allows advertisers to buy TV inventory much like they might buy programmatic video, using a demand-side platform (DSP) that enables split-second, data powered decisioning to target audiences (or types of consumers) rather than the long-standing and blunter demographic and daypart approach. The key benefit of this approach is better, more granular TV audience targeting at the speed of today’s technology.
The concept of aggregating linear TV inventory (“supply”) and connecting it to buying technology was born out of brands that need to unlock new, more precise methods to reach their true consumers in an increasingly fragmented landscape. TV advertising remains extremely vital and vibrant for brand marketers. It is still the most powerful and fastest way to establish a foundation of reach and frequency needed to drive meaningful sales results. The dream is that we can deploy sophisticated technology and precious data to leverage the power of TV in new and more effective ways.
It’s early days for programmatic TV but we see accelerated momentum as brands and their agencies experiment with technology and data to pave the way into the future. Today, eMarketer puts programmatic TV spend at just 1% of the overall dollars spent on TV in 2016. But they see that number rising to 6% in just 2 years. The largest factor that will affect growth rate is the size and scope of the TV inventory placed into the pool accessible for programmatic transactions. For now, the most desirable TV inventory isn’t available for programmatic buying. But as has been the case since the advent of advertising, advertiser needs will push for innovation and new methods of buying to achieve the age-old goal of reaching the right person at the right time with the right message.
The benefit of more precise data-driven TV targeting is powerful. The ability to have our collective cake and eat it too (the scale and power of the TV but with better, more precise and real-time buying strategies) is in front of the industry. What an exciting future ahead!