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The State of Programmatic TV [Study]

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Programmatic TV has been doing the rounds ever since soaps and TV series started to take over the TV universe. For the amateur, this might still be a mystery. However this article not only demystifies this slowly but stealthily growing trend, it will also give the reader a glimpse of the current situation of Programmatic TV. Programmatic TV advertising is the data-driven automation of audience-based advertising transactions. It inverts the industry standard where marketers rely on show ratings to determine desirable audiences for their ads. Instead, with programmatic tech, marketers use audience data to pipe advertising to optimal places. It means more specificity. Rather than relying on ratings for specific shows or channels, marketers can use programmatic tech to reach a more specific subset of consumers. They don’t care if that ad shows up on X Factor or the X Games, as long as the target audience is watching. Most TV audience targeting today is not quite that dvanced, however, which is one reason why programmatic TV is still in its infancy.

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Buyers and vendors argue that a lot of TV inventory today is undervalued, and that more specific audience targeting will help boost that value. Some TV executives don’t buy it, worried programmatic will commoditize and devalue their inventory. Ultimately, networks with a robust business aren’t motivated to change the way they sell. Buyers and sellers are familiarizing themselves with the landscape, but less than 1 percent of TV inventory has been sold programmatically until now. What’s holding the market back, is a lack of trusted data jointly accessible to brands, agencies and media partners.

TV advertising systems are complicated, balkanized, and extremely busy running a $70 billion business. We won’t get to a true programmatic ecosystem overnight. Instead, we see a staged slither-crawl-walk-run transition playing out over the next several years. The goal of this process will be collaboration within the industry to create standards and increase the chance of success for all players. There will be slow adopters, who fear devaluating their hit show inventory, for example but over time, we hope the simplicity of automation, plus the immediacy of data, will prevail in uniting the supply-side and demand-side economics of TV.

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