Insider’s Paul Verna will be speaking at AdExchanger’s Programmatic I/O conference on Sept. 26-27 in New York. Click here to register.
Connected TV advertisers are enamored of programmatic because of its digital-like ad targeting.
Insider Intelligence expects that roughly 87% of CTV ad inventory will be transacted programmatically in 2023, including through programmatic guaranteed deals.
That number will likely increase to 89% in the next two years, said Paul Verna, a principal analyst and head of Insider’s advertising and media practice.
But programmatic CTV is far from perfect and rife with fragmentation.
Multiple demand-side platforms are selling the same ad space, advertisers don’t know where all their ads are running, and measurement standards are sorely lacking.
It will get better, though … right?
Programmatic CTV is an unruly marketplace, Verna said, “and I don’t necessarily see that changing anytime soon.”
Verna spoke with AdExchanger.
AdExchanger: Why do you count programmatic guaranteed deals as being programmatic rather than direct?
PAUL VERNA: We consider any ad buying involving automation to be programmatic. In the case of programmatic guaranteed, it may look like a bespoke TV buy, but it’s still happening within programmatic pipes.
Will the open exchange ever be a viable option for CTV inventory?
For CTV, I think the open exchange will stay mostly off the table. Buyers certainly won’t want to spend CTV ad dollars that way because the open exchange tends to have lower-level inventory, not the high-quality video inventory advertisers expect when they pay premiums on CTV campaigns.
What are some of the downsides to programmatic CTV ad buying?
There are still some pain points.
Frequency capping is one that the industry hasn’t solved yet. Part of the reason why that happens is because advertisers don’t always know exactly what they’re buying.
The inventory overlap between programmers and their distributors is bewildering to buyers. It’s not straightforward and can be hard to untangle.
Is that why some buyers prefer programmatic guaranteed over biddable deals?
Programmatic guaranteed deals are an automated version of old-school insertion orders, where a buyer negotiates with a network and pays to get something very specific in terms of where ads are running.
That’s why many CTV advertisers choose programmatic guaranteed. Marketers want assurances that they’re going to get what they pay for. They don’t like uncertainty.
What is the most acute pain point for CTV advertisers right now?
Measurement is the biggest issue in CTV right now.
In theory, measurement should be easier on CTV than linear because of all the data that’s available in a digital channel. But in practice there’s really not a lot of transparency in CTV measurement because of walled gardens guarding their first-party data.
What needs to happen for the industry to solve that problem?
The ideal solution would be for the industry to reach consensus around a single set of standards for measurement companies.
But it might be a bit naïve to think that’s actually going to happen. The measurement debacle almost reflects our current political landscape: divided and unlikely to coalesce around collaboration.
We should expect a new normal of buyers accepting the problem of measurement murkiness and working around it to the best of their ability.
Measurement will come down to understanding what’s going on within individual platforms without really being able to compare publishers against each other. [Developing] standards for cross-platform measurement is much easier said than done.
This interview has been edited and condensed.
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