Home Data-Driven Thinking The CTV Gold Rush Isn’t Watering Down Programmatic, We Just Need To Dig Deeper

The CTV Gold Rush Isn’t Watering Down Programmatic, We Just Need To Dig Deeper

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Amanda Martin, ​​SVP, corporate development & strategic partnerships, Goodway Group

On TV & Video” is a column exploring opportunities and challenges in advanced TV and video. Today’s column is by Amanda Martin, ​​SVP, Corporate Development & Strategic Partnerships at Goodway Group.

At Programmatic IO in NYC on Tues., Oct. 26, Amanda Martin will speak on the future of walled gardens in the presentation “Social Walled Gardens Aren’t What They Used To Be.”

 During the pandemic, consumers flocked to streaming media, with advertisers following suit. The future that the advertising industry was preparing for happened in just a few short months versus the projected years, culminating in a proverbial “gold rush” to connected TV (CTV) that the industry was wholly unprepared for. 

Having grown so quickly, the use of programmatic ad buying within CTV now faces significant hurdles. The consumer experience is inconsistent. And the benefit to advertisers is not fully realized, since the buying process still resembles that of legacy linear TV. 

However, it’s important to remember that programmatic CTV is in many ways still in its youth and has significant room to mature. With the right tweaks, it has the potential to completely reinvent TV advertising and turn into a medium that is highly effective at driving customer acquisition efficiently. 

The question is, how do we begin to attempt to jumpstart the industry’s transformation? To figure this out, we must determine: What is and isn’t working for programmatic and CTV? What do brands and agencies need to keep in mind so consumer needs are met?

Breaking it down: CTV, linear TV and the road to programmatic

CTV is the collision of non-linear consumption and programmatic buying practices, bringing about the shift from traditional TV buying practices. Right now, we are stuck in a “rinse and repeat” model where CTV advertising is guaranteed via private exchanges and upfronts instead of a biddable market. But only a biddable market offers an environment that allows advertisers and publishers to reap the full benefits of the programmatic infrastructure.

For those buys that are happening via programmatic channels, there are also challenges, many stemming from the lack of central supply sources. Broadcasters had historically deprioritized their streaming rights and are now gaining back control. During this transition, advertisers are sometimes able to purchase ads from multiple sources for the same inventory, which makes it difficult to put controls in place for simple buying practices like frequency capping, leading to that annoying consumer experience of the same ad showing up again and again. 

In most cases, we are using programmatic guaranteed to facilitate the same buy an insertion order previously represented. I would argue this signals a maturity in the CTV space. The restriction allows for the avoidance of commoditization seen in the display programmatic market. Therefore, it will take a larger and longer effort to bring the strengths of programmatic buying to premium broadcasters.  

Reports have shown that programmatic within CTV presents an $11.36 billion advertising opportunity, but to reap its full benefits – including improved brand recall among consumers, targeted advertising, returned control to brands and advertisers, and enhanced measurement and attribution capabilities – the industry will need to focus on perfecting the programmatic process and nailing automation. 

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So how do we accomplish this? 

We can’t solve every problem at once. We will need to start by tackling low-hanging fruit. For example, we can’t expect to buy CTV in the same way we buy display programmatically. We have to appropriately use the programmatic pipes for the medium. Perfecting buying strategies is another important factor. We have to ensure frequency capping is under control. It is also critically important to build for optimum measurement and price discovery by taking the focus away from targeting and transacting and shifting it to measurement and attribution, which will truly transform the opportunity.

We have to be diligent enough to push CTV to a place where it fully uses all of the promises of programmatic. Programmatic has a lot to offer, and while many tools are not yet applicable to CTV, those that are available provide tremendous value to brands and advertisers. To move CTV toward the “perfect state” we often talk about, we will need to focus on fixing the current infrastructure by investing in what is working and changing what isn’t. 

It is also important to level-set our expectations and understand that two very different worlds are now colliding. While that will bring about much-needed change and innovation in the industry, achieving a seamless integration will require us to strike a balance between both. That also means how TV is bought and sold needs to adapt and what programmatic means to a brand or an agency also needs to be brought into perspective. 

It is estimated that 60% of CTV inventory is expected to be bought programmatically in 2021.  There is room for us to improve the process before we reach close to 100%. Let’s be ambitious with the promise of CTV and all that it has to offer. The simple act of buying CTV programmatically isn’t the goal line. Let’s declare victory in programmatic for CTV when we’ve actually accomplished the ideal future state. 

Follow Goodway Group (@goodwaygroup) and AdExchanger (@adexchanger) on Twitter.

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