Is Programmatic Television Advertising Viable?

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22.Is programmatic television advertising viable

In recent times and due to the social crisis that we have been experiencing, we spend much more time in our homes consuming more technology for domestic use, television being one of the most representative.

Due to the social isolation that we are experiencing today with the pandemic, we spend much more time at our homes and consume more technology. In addition to the desktop computer that many have returned to using for telecommuting, there are also all the other electronic devices that we use to entertain ourselves.

Investment in the media is also affected by these changes since advertising in the streets and other places where people gather loses value and gives space to all the other alternatives that can reach the devices and screens used at home.

For this reason, the question arises about the viability or possibility of programmatic advertising on television becoming a reality in the near future, which can be seen regularly in other formats, such as audio ads and other types of in-stream ads.

Television advertising

The number of daily hours we spend in front of the television has increased considerably. According to electronic measurements carried out by an important Media group in the USA, the increase was even 30% compared to pre-quarantine periods, so current television commercials are becoming increasingly important.

One of the most innovative types of television advertising, which is slowly being implemented on smart TVs in various countries, is programmatic advertising. This technology is intended to deliver current television advertisements relevant to the interests of a specific audience.

What is programmatic advertising

Programmatic advertising refers to an automated purchase process, where the company interested in advertising can directly see the advertising spaces that are available online, and acquire them on their own through real-time auctions called RTB (Real Time Bidding).

Programmatic technology uses artificial intelligence and data collection to increase the efficiency of personalization in television advertising, in order to provide ads that match the interests of the audience watching a certain channel or program.

A clear signal that this type of technology has gone really far is the fact that there are even companies like ranwell productions that offer programmatic advertising solutions to non-digital media, such as TV and radio. This is the case of SmartyAds, which digitally offers programmatic purchases on TV, and the Jelli platform, for example, makes available to its clients a technology that allows them to detect the audiences that listen to certain radio programs, thus optimizing the delivery of ads to non-digital radios.

How TV advertising works

To better understand programmatic advertising, we first need to understand how traditional television advertising works.

This depends on a human agent to be carried out, be it an advertising agency or a marketing expert, and consists of negotiating an available advertising space on a television channel, establishing the price, frequency and broadcast time of the advertisement.

With programmatic advertising, however, the mediators are automated digital platforms, not people. With them, advertisers can see what advertising space is available and buy it; without the need to waste time and money negotiating with a vendor, arranging meetings at specific times and spaces.

Likewise, there are three parties involved in the technology:

  • Advertisers: those who seek to promote their brand or products.
  • The publishers: websites or applications that own the available advertising spaces.
  • The audience: the potential clients of the advertisers who consume the content.

Challenges of programmatic advertising

So, is programmatic television advertising viable? Although the answer is not certain at present, what we do know is that programmatic advertising still faces several challenges, such as:

  • The adjustment of policies in the different countries to defend the privacy of consumer data.
  • The advertising companies take advantage of the general ignorance to charge extra money on the platforms.
  • The loss of effectiveness of third-party data, and the need to collect information from first-party data and customer data platforms to ensure the success of the campaign.

Although the forecasts of Zenith’s “Programmatic Marketing Forecast 2021” indicate that this year 69% of all digital media will be marketed through programmatic technology, the truth is that this type of advertising continues to advance slowly for television.

The main challenge of programmatic advertising on TV is the contradiction generated by the search for segmentation in the television audience, this being a communication medium recognized for the level of coverage it offers.

There is no doubt that programmatic technology has several advantages and has great potential. As for its viability on television, the main problem has to do with the connection between massive audiences and efficient segmentation for such an audience level.

We are convinced that this can be solved with technology and the will of the media, also contributing to the correct implementation of digital transformation in companies. Sooner or later, TV will have to adapt to a programmatic strategy, due to the unstoppable advance of digital technologies and because of the needs of consumers and advertisers: everyone is looking for it.

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