Audience Isn’t The Only Solution To CTV’s Transparency Issues

On TV And Video” is a column exploring opportunities and challenges in advanced TV and video.

 Today’s column is written by Alex White, COO at Peer39.

While conversations around connected TV tend to center on the leading streaming services, there are more than 200 CTV providers. A complex, fragmented ecosystem has created a lot of confusion about what’s for sale to advertisers, how they can target their ads, and what kind of data is available.

As CTV gets off the ground, advertisers are already looking for more transparency. But part of the reason that transparency remains an issue is that advertisers are only looking for transparency into one part of the picture. CTV holds the promise of digital ad buying strategies, but it is still viewed as TV, and therefore, the content or context matter, too. CTV advertisers are falling into the same flawed habit that they have for the last 10 years: an over-reliance on the audience data regardless of context. We know where that story goes.

Unnecessarily complex

CTV advertising marries the promise of granular targeting, such as programmatic digital advertising, with the engaging power of TV. While industry analysts believe programmatic advertising in CTV is the future, getting there remains a challenge. And in these relatively early days, advertisers have been left to blaze their own trails.

They have many paths to choose from. CTV inventory is available through direct deals with TV networks or video publishers, the programmers or streaming platforms. It’s also available from DSPs, aggregators and aggregators of aggregators that can collect inventory from various apps and use their own first-party data to aim ads across third-party properties. That’s a lot of choice, and unsurprisingly, it has left prospective buyers saying, “It’s hard to figure out the best route.”

This system also makes it so that advertisers can buy the same impression from many different sources. The problem isn’t simply that advertisers can buy from multiple entities, but that they can go to several places to buy the exact same inventory. Factor in the varying levels of transparency that each of these options provide, and it becomes clear that advertisers need things to be easier.

Overemphasis on audience

One of the under-discussed ways that advertisers have limited themselves in programmatic media is by relying too heavily on audience as the primary data for decision-making and avoiding any inventory that can’t be tied to an audience. Online, this cuts out entire browsers, such as Safari, because the inventory can’t be targeted or measured, even though the browser is used by a highly desirable audience of Apple owners. As browsers begin planned policy changes that will limit the ability to track consumers using cookies, the widespread gnashing of teeth demonstrates that the pendulum has swung too far over to the audience side. CTV is beating a similar path, but there’s still time to course correct.

Linear TV advertising worships at the altar of demographics, but it’s never strayed too far away from programming content. No one buys the Super Bowl solely because it over indexes for a very granular audience segment. They buy it because it’s the Super Bowl, and it’s the most-viewed TV broadcast for the entire year. It will get viewers, sure, but this strategy is similar to buying a homepage takeover on in 2005.

Content matters in programmatic CTV too, and this can help solve some of the transparency crisis. Because the pipes and strategies used to buy in the CTV space to date have been ported over from the digital realm, advertisers are overly focused on users who have done something or performed some triggering action, and less on what they are watching right now.

If advertisers do care about content and the context of the program itself, they are more likely to buy inventory through PMPs, because they have no transparency into what’s available via open exchanges. This is why the majority of CTV spending is done directly or through private marketplaces – quality inventory and transparency earn the advertiser’s investment.

But relying on PMPs doesn’t crack open the CTV market the way that the industry expects (or needs) because it means CPMs stay really high, and the efficiency of programmatic is mitigated. While there is a push to better understand CTV audiences and data, there needs to be greater transparency into the programming itself.

The fix is to rely less on audience in the open exchanges, and more on other data signals from the bidstream that are tied to the programming itself. Content contextual signals are a great counterbalance to audience, because they can relay content or network to the potential buyer.

Perhaps more importantly, it will help buyers acquire the content they want at lower CPMs, opening up CTV inventory to advertisers of all sizes and growing the revenue for content owners across the board. This is critical as digital-native advertisers, such as DTC brands, try to move beyond the web and social and into performance-driven TV campaigns.

Follow Peer39 (@Peer39T) and AdExchanger (@adexchanger) on Twitter.

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