Programmatic buying has changed the landscape for streaming video advertising, and now it’s doing the same for TV. At today’s NAB conference in Las Vegas, Nevada, Sandro Catanzaro, the co-founder and senior vice president for analytics and innovation at DataXu, explained how this automated system of ad buying will completely transform television.
Programmatic advertising means using advanced audience data and automated processes to execute ad buys. Catanzaro first explained the three types of television programmatic advertising:
- Programmatic Linear: Where the full audience sees the same ad at the same time. An index of a program’s viewers helps advertisers target consumers.
- Addressable TV: Available to 40 percent of U.S. households, this replaces a broadcast ad with a targeted ad.
- Connected TV: Available on devices connected to the internet (typically set-top boxes), this pairs ads with consumers on a one-to-one basis.
That’s where the programmatic ad world stands right now, but what Catanzaro shared is where it’s going. He offered five predictions on the future of programmatic video advertising:
- Addressability: Currently at 40 percent, addressability will grow to 50 percent of all U.S. households by the end of 2016. This will represent a tipping point, with national brands able to execute campaigns at scale in 50 million households.
- Measurement: Advanced measurements will lead to new indicators of campaign success. Rather than looking at CPMs, buyers will chart how many sales a campaign led to.
- Networks: Major networks will start offering programmatic options that go beyond traditional Nielsen demographics. Viacom and CBS are already doing this, Catanzaro said.
- OTT: The scale of over-the-top content will increase in 2016, attracting content creators beyond traditional broadcasters. Advertisers will be able to get an accurate view of the audience.
- IPTV: At least one major network will begin offering unicast delivery to households, sending a unique stream to each home.
“This is the year where we’re really not going to be talking about TV and digital independently,” noted co-presenter Bob Ray, president of media planning company DWA. “It becomes about content…We’re at the precipice of digital, if you will, being the driver of advertising dollars.” Emotion is now a factor, he added: It’s now about connecting the right ad to the right viewer when they’re in the right state of mind.