“On TV & Video” is a column exploring opportunities and challenges in advanced TV and video.
Today’s column is by Peer39 CEO Mario Diez.
CTV remains one of the brightest spots in the advertising landscape. As with all emerging media, advertisers are eager to follow consumers wherever they go. And because CTV combines the time-tested value of TV engagement with the precision of digital buying and targeting, it has marketers salivating for more: more inventory, more data, more possibilities.
But the big question is: How willing is the ecosystem to provide what advertisers seek?
There are currently two ways advertisers buy CTV. But there’s a fight brewing over where CTV investment will go, especially as new advertisers enter the sector and investment accelerates.
Will the future of CTV hew toward combined linear direct buys or digitally driven programmatic practices where data-infused optimization and transparency needs are evolving? Or will it be some combination of both?
The old-fashioned route
Usually, whenever an industry comes to a fork in the road, there’s an urge to stick to the status quo. Right now, CTV is a seller’s market. Advertisers are clamoring to get in front of consumers who are no longer reachable through traditional linear TV. They are willing to use strategies that mimic their linear campaigns wherever possible.
In order to do so, many are buying CTV ads the same way they buy ads for linear TV. They’re bulk spending through traditional IOs, either directly through the OTT platforms or via media deals managed by an agency. This method comes with a great deal of control – and the level of reporting that advertisers crave. In a competitive market, buying directly guarantees the ads will clear, giving advertisers the impressions they want.
But even with the confidence of reporting and clearance, there’s a downside for the advertiser: modern techniques like optimization never come into play. If one particular program or one genre of content drives performance, advertisers have limited options for diverting and optimizing their spend.
Direct, but make it programmatic
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Part of CTV’s popularity is it combines TV and digital targeting capabilities. It’s only natural that ad buyers would want to use traditional audience targeting while also maintaining the sense of security that comes with premium content. That’s the advantage of the private marketplace, which allows direct buys on select CTV platforms that are delivered programmatically to targeted audiences.
This approach gets advertisers one step closer to CTV’s true potential, but still limits the transparency, controls, and modern optimization techniques. Advertisers may get the halo of buying on a premium provider, but questions arise when the reporting comes out.
What kind of programming accompanied my ads? Was it new programming or older content? Was it comedy, drama or live sports? Was one kind of programming driving more outcomes than another?
The best of both worlds
To date, a certain level of control and transparency has been missing from buys outside direct deals, so advertisers have had very little confidence in buying this way. But if advertisers were to finally get the insights they need, they could find audiences using the modern digital media techniques to which they are accustomed. In fact, the future may be some combination of linear and programmatic strategies, because it would allow performance, optimization, transparency and confidence in programming.
If CTV is the future, advertisers need modern data and insights, rather than relying on the same level of reporting they’ve used for the past half-century of TV advertising.
The CTV train will keep humming along, make no mistake. But complaints and grumblings will only grow louder, leading to a conflict over the future path of CTV buys.
Publishers will protect their investment, and some are not going to put their inventory into the market. This is the same battle that happened in digital display with ad networks, and history is bound to repeat itself.
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