One estimate predicts 30% of local TV ads will be bought using automated systems in just 18-24 months. Others say it will take a little longer, but will happen. This “programmatic” buying is no longer reserved for filling low-value inventory with remnant ads, but instead can make local TV a more attractive medium.
The popularity of automated ad sales — once considered a means of filling low-value inventory with remnant ads — is on an upward trajectory, prompting some industry watchers to predict they will soon account for nearly one-third of all local TV transactions.
Speaking at the TVB Forward conference in New York Tuesday, AdMore CEO Brendan Condon said he believes 30% of local TV ad sales will be conducted using automated ad sale systems within 18-24 months, primarily because the platforms now provide a more sophisticated way for buyers to reach specific viewers.
“Now we can target audiences in scale, and provide an elegant solution for marketers to reach them,” added Condon, saying that more sophisticated automatic ad buying systems are fueling the increased interest.
“We’ve been using the methodology for sometime. We’re just getting better at it,” Condon said.
Shereta Williams, president of Videa, a Cox Media Group startup focused on programmatic TV ad sales, agrees. She believes it will take slightly longer — three years — before automated ad sales hit that 30% mark.
However, she believes local TV will become a more attractive medium to buyers in the process, primarily because new systems can provide buyers with “spot-level detail” about the TV viewers they want to target — and where to find them.
“It makes spot TV easier to buy, and it also makes spot TV more powerful,” she said.
That mainstream media is embracing automated ad buying marks a big evolution in the system, long considered more a means of filling empty inventory than facilitating more complex transactions.
Initially, automated — also known as programmatic — ad sales systems offered buyers low-value inventory pooled from across the Web, often for very little money. Today, however, new platforms act more like private exchanges, offering inventory — as well as very detailed information used for targeting audiences — from a specific pool of outlets, in this case TV stations.
Kevin Gallagher, a Starcom MediaVest group EVP, said those kinds of systems provide a valuable service to buyers who want to support their media buys with data, but no longer have the time to do that only through face-to-face dealings.
“When you boil it down, clients are looking for three things right now: flexibility; making media planning decisions in real time; and data,” he said. “And that, at the core, is what agencies have always done for marketers.”
Not everyone, however, believes that the industry is really ready to embrace automated ad buys with such fervor.
WideOrbit Founder and CEO Eric Mathewson said it could be years before TV more fully adopts programmatic buying — and even then should not be done at the expense of traditional handshake deals. That’s despite WideOrbit investing nearly $50 million in technology to facilitate the system.
“Relationships are important in this process,” Mathewson said. “We feel its our responsibility” to make sure the progression of programmatic ad sales does not undercut old-fashioned business.
Gallagher agreed. “When I talk about automatic buying I talk about the transaction,” Gallagher said. “The rest is relationship.”
Read other stories from the TVB Forward conference here.