Programmatic TV Is Going To Change Advertising

Programmatic television is full of promise, providing sellers, buyers, and partners unite under newly defined guidelines.

The first wave of disruption in the TV industry has already happened. If proof is required, simply look at Netflix and Amazon. They have created cult content that has irrevocably changed not just what we watch, but how we watch it. A second wave of disruption is now upon us in the form of programmatic TV—and this time, it’s going to change advertising.

Giants like AT&T and NBC Universal have begun offering new ad solutions, powered by analytics and data science, for not just catch-up TV, but for linear viewing as well. TV advertising, which has historically been bought and sold the same way for decades, is being transformed for good in this new landscape with scalable, data-rich, and transparent innovations.

The industry asked for simplicity, consistency, and transparency and finally, we have it in the form of the 2016 GABBCON ABCD Guidelines, released in March. The ABCD Guidelines provide a framework for the success of programmatic TV buying and include standards around third-party authentication of audience data, normalizing data-set values, and the ability to reproduce results over time, using a third-party data match partner and a data management platform.

Consensus And Collaboration

The ABCD Guidelines are the product of a diverse industry working group consisting of everyone from programmatic platforms and media agency groups to media owners like CBS and Fox. Even competing companies can have a common interest and goal when it comes to collaborating on this complex but important topic.

Widespread adoption of the ABCD Guidelines will allow sellers and buyers to fully capture the increased value generated by data-driven TV buying. Programmatic television is full of promise, but unless sellers, buyers, and partners unite under the newly defined guidelines, prevailing confusion will deter inventory from making its way into the marketplace. Inventory, above all, is what is needed to ensure that programmatic TV can succeed. Properly managing, securing, categorizing, and selling it is key.

Small Gains, Big Wins

The adoption of universal standards clearly won’t happen overnight.

To extend progress across the industry, it’s important to maintain momentum. The first iteration of the ABCD Guidelines must move beyond this initial draft to something that is definitive, but yet remains dynamic. These guidelines are the first step. As standards emerge, so, too, will additional buying models for programmatic TV.

Both buyers and sellers will need to become well-versed in the complexities of programmatic TV in the coming months. Programmatic TV will eliminate media waste, but it will and should remain primarily a branding vehicle. It will not deliver as many one-to-one consumer experiences as brands and agencies have been hoping for. After all, it is still TV. And TV has always delivered and will continue to deliver broad reach and mass scale.

The Next Phase

In the year ahead, it seems likely that advertisers will reduce their eCPM as set-top box cable and satellite addressability reaches 50% of U.S. households. This means that content providers can better monetize inventory and in turn, provide more information about the composition of their audiences back to marketers. The trend of standalone TV apps will also continue, offering a new generation of viewers the chance to build custom collections of content across devices.

As GABBCON co-founder and CEO Gabe Greenberg has said, “The integration process for programmatic TV is complex, manual, and proprietary—meaning it cannot be reproduced for multiple partners. Until that happens, programmatic television cannot scale meaningfully.”