Originally posted on http://www.goprogrammatic.com/programmatic-tv-and-the-future-of-video/

 

As the sun begins to rest on what is now known as traditional TV advertising, online programmatic TV is on the rise. Going all the way back to 2011, real-time bidding or better known as RTB has gained massive success through the years now leading its way into the television sector.

Programmatic TV may be the future of traditional television but it’s not there yet. But what programmatic TV will bring to the traditional arena will be the sole reason for the soon to be increase in popularity among marketers and business owners alike.

Price and placement. Digital advertising has led the way for many new improvements compared to the traditional method of doing things, but nothing greater than lowering the price to run content and better ad content relevancy.

What is programmatic tv advertising?

Programmatic TV can be defined as the automated and data-driven approach to deliver video buying and delivering against traditional video content on television. This isn’t limited to web, mobile, connected tv, addressable tv, and some types of linear tv.

Connected TV

Connected TV or CTV as it’s more typically referred to as devices that hold an internet connection and allow for video content to be streamed. Devices like smart TVs, Xbox, PlayStation, and streaming boxes. Unlike traditional commercials, CTV can provide insight data like completion rate, device engagement type, and even more specific audience data.

Addressable TV

The options within addressable TV fall within serving different ads to different household audiences while broadcasting the same shows. These types of targeting capabilities allow for addressable TV to stand out amongst the old way of running video ads. The ability to pick households based on audiences and interests allows for much better targeting. Addressable TV works with cable networks to get access to certain households.

Linear TV

This basically covers all areas of live broadcast television. Linear TV’s weakness revolves around the issues of traditional advertising. Old metrics, standard ads, and lack of targeting has pushed linear television to the back of video advertising options.

How programmatic TV works

The whole idea of programmatic advertising revolves around the automation of ad buying and selling through a unified platform for all channels.

Programmatic TV’s data-driven technology allows for video impressions to be bid on in real-time. In the moments that this programmatic video transaction takes place, multiple advertisers are all bidding on a unique impression opportunity. The leading bid is then bought and placed in real-time to the targeted end viewer.

The targeting that is available within programmatic TV truly has opened the door for better relevancy for video placement. The ability to target around household information, audience demographics, lifestyle, and financial data will cause programmatic TV to the future of video advertising.

The design layout for programmatic TV ads usually look similar to a square sized ad being placed in the bottom right corner or a long bar size dad being placed along the left side of the TV frame.

Programmatic TV Trends for 2020

It’s obvious that programmatic TV has some amazing future opportunities ahead and should be looked at closely. Our job as advertisers are too not just to follow new ideas of marketing but to stay ahead of the curve. One of the best ways of doing that is looking at current spend projections for the near future.

1) Programmatic ad buying is projected to reach almost 70 billion by 2020
In the earlier years of programmatic advertising spends were in the infancy stages. Within the last past 4 years programmatic advertising has grown to be projected to be as high as almost 70 billion dollars by 2020. The reason programmatic spends continue to scale is due to the success that they bring.

2) Programmatic TV ad spending projected to reach upwards to 5 billion by 2020
Even though programmatic TV spends hasn’t reached as high as general programmatic advertising, programmatic tv is still is on the rise. Programmatic TV will be a hot trend in the coming years and based on the growth of programmatic advertising in the past years we expect to see the same in programmatic TV.

3) Cord Cutting has increased by 48 percent in 8 years
According to Nielsen, the evidence that cord cutting has increased by upwards of 48% in the past 8 years points to a growing consumer trend. People are disconnecting from traditional viewing channels and going connected.

4) 36 million “Cord Never’s” exist as of 2018
The term “Cord Never’s” refers to a group of individuals who have never had any type of corded subscription for viewing traditional TV. More and more viewers will disconnect as this new trend continues to grow. As this trend grows so does the ability to target these untouchable audiences through programmatic TV.

5) 18% of US households cancelled their cable providers last year
The trend to go digital everything is on the rise and consumers are leading the way. As marketers we must follow the attention and traditional television is losing those viewers at an exceeding rate.

It’s not enough to just jump on board with programmatic advertising because your competitors are doing it. The goal should always be to stay ahead of the digital curve. The points above only point to the opportunities of what programmatic TV could grow to become.

Why Programmatic TV is the future of television?

Wasteful ad spending has led to marketers and business owners looking elsewhere. It’s obvious that traditional TV ads lack the targeting capabilities of programmatic TV, but people are disconnecting from traditional viewing methods faster each year. With lower TV ratings and the amount of people disconnecting, advertisers must find a new way to get in front of their shoppers.

When the audience that was available on traditional television is no longer available than the need to go and do programmatic TV desired. But by that time, it will be too late. Programmatic TV has and will change the game for how video advertising content will be absorbed. The change in consumer behavior when it comes to video consumption will be the reason programmatic TV will be the future of television.

Data is king when it comes to programmatic advertising and the same goes for programmatic TV.

3 reasons why you should try programmatic TV

1) It’s cheaper than traditional television
2) Potential niche targeting capabilities
3) DATA

Understanding how to leverage programmatic TV as a marketer and/or a business owner will be the key success in getting faster ROAS in the digital world. Launching a programmatic TV campaign to test against traditional TV results is always the best first step and we can help!

Are you striving to become an early adopter of programmatic TV? Find out how we can help!