Programmatic TV 101: The multi-billion-dollar ad tech that’s transforming television
Recode.net reports that it’s hard to conceive a more exciting advertising opportunity than programmatic television. On one hand, brands are able to command consumers’ full attention with 30 seconds of full-screen sight, sound and motion on the big screen. On the other, they can implement the same data tools they use online to pinpoint the right audiences for their advertising message. With the potential to limit DVR skip-through rates by providing viewers with the most relevant possible advertising, programmatic TV represents the best of the digital and television advertising worlds.
So it should come as no surprise that programmatic TV is expected to be a $17 billion opportunity by 2019.
Given this incredible potential, it’s easy to be frustrated that the programmatic TV market hasn’t developed faster. After all, data-driven advertising is responsible for more than half of all online display spending, but only around 4 percent of television spend. But while a number of roadblocks still stand in the way of television’s programmatic future, the past few years have seen television networks, media buyers and advertising technology companies take several big steps toward bringing increased precision and automation to the market. Just as programmatic became a buying staple in digital media, so too will it likely become widespread in television, albeit with a different set of rules and objectives.
What is programmatic TV?
In considering the prospects of programmatic TV, it’s important to define exactly what it is we’re talking about. In short, programmatic TV represents any TV ad buy that uses data and automation to more precisely target specific consumer audiences, with the end goal of driving better return on media spend.