Martech: Martech is Marketing Logo
  • Topics
    Transformation
    Operations
    Data
    Experience
    Performance
    Management
    Special Reports
    All Topics
  • Conference
  • Webinars
  • Intelligence Reports
  • White Papers
  • What is MarTech
    Mission
    Team
    Newsletter
    Search Engine Land
    Third Door Media

Processing...Please wait.

MarTech » Connected TV and OTT » Why True Programmatic TV Isn’t Coming Just Yet

Why True Programmatic TV Isn’t Coming Just Yet

Programmatic ad buying is coming to television, but don't count on it arriving anytime soon. Columnist Alex LePage explains why.

Alex LePage on March 25, 2015 at 9:01 am

video-tv-generic1-ss-1920

Considering how quickly programmatic ad buying has changed online advertising, it’s perhaps not surprising that some are already predicting that it will soon disrupt TV advertising as well.

To be sure, “programmatic” will one day gain a big foothold in TV, and, when it does, both brands and consumers will benefit from the better targeting and improved efficiency.

But, for two very fundamental reasons, truly programmatic ads on TV are still quite a ways off. TV, as we know it, isn’t nearly as close to collapse as some people think. And, contrary to what is sometimes reported, the infrastructure for full-fledged programmatic ads on TV simply doesn’t exist at this time.

TV As We Know It Isn’t Going Away Anytime Soon

For the more digital savvy, it’s not hard to imagine today’s TV model disappearing altogether in the not-so-distant future. The combination of set-top boxes and streaming services has made sitting down to watch a particular show at a certain time feel almost old-fashioned to many of us.

And there’s little question that TV is on the decline. With HBO GO and CBS both beginning to offer digital subscriptions directly to consumers, it’s becoming easier and easier to bypass the distributors that have been calling the shots for so long.

But we shouldn’t get ahead of ourselves. TV is going to be around for a while. For one thing, the people who are creating content for TV aren’t particularly anxious for the current system to disappear. Cable companies pay enormous sums to networks to include them in their bundles.

And while there have been plenty of skirmishes between cable networks and the cable companies, at the end of the day, the cable companies will keep paying because they’re still making enormous sums on the bundling of phone, Internet and TV offerings. Indeed, the broadband that is bundled with cable TV is especially profitable for the distributors, meaning that the Internet, ironically, is helping to keep the old TV model alive.

Put another way, the TV industry as we know it isn’t quite broken. A lot of people are still making a lot of money, and these stakeholders will fight hard to keep the current structure in place, even as Netflix, Amazon and all the others continue to build their alternative models.

Programmatic TV Isn’t Ready For Prime Time

It’s easy enough to understand why so many people are excited about programmatic ads on TV. Programmatic makes advertising more effective, and the billions of dollars spent each year on TV ads hold the promise of massive gains for the industry. Alas, at the moment, some big technical hurdles still need to be cleared before truly programmatic TV can go mainstream.

For one thing, other than perhaps Oreo ads, there are no cookies when it comes to TV. That means that while better data can be used for targeting, the targeting can’t take place in real time.

Moreover, TV advertising, at least as it is currently structured, has far too many manual elements to make anything close to a truly automated workflow possible. And while smart TVs and set-top boxes are beginning to make it possible to gather data on consumers, the scale just isn’t there yet. As eMarketer recently noted, “advertising options available through these devices are limited in general — let alone in programmatic.”

Still, if we should be wary of too much hype, we should also leave room for cautious optimism. More programmatic inventory through set-top devices and smart TVs are predicted for the year ahead.

It’s a small step for programmatic TV, but also another reminder that the day will come when ads on TV screens are targeted to the right people. Just don’t expect that day to arrive anytime soon. Programmatic TV is coming, but there’s a long way to go.


Opinions expressed in this article are those of the guest author and not necessarily MarTech. Staff authors are listed here.


New on MarTech

    3 changes coming to Google Ads audience features

    FTC hits Twitter with snark and $150 million fine for allegedly selling security data to advertisers

    Hootsuite joins TikTok’s Marketing Partner Program

    Getting started with the Agile Marketing Navigator: Aligning on a Guidepoint

    Webinar: Benchmark your social media performance for a competitive edge

About The Author

Alex LePage
Alex is responsible for Rubicon Project Buyer Cloud’s go-to-market strategy, sales enablement and client strategy. His team established the vision and positioning strategy for the Buyer Cloud’s suite of solutions. He plays a key role in sales enablement and product innovation. Alex and team partner with key clients to drive marketing and advertising advisory and innovation. In his previous role, Alex defined and built the Client Development competency and team. Alex was brought onto the Buyer Cloud team from Chango when the company was acquired by Rubicon Project in March, 2015. Prior to joining Chango, Alex directed the newly created Hearst/ iCrossing joint business, integrating premium editorial content with digital expertise. He also held a Managing Director role at iCrossing, overseeing a $20MM portfolio of clients, including Sears, Lands’ End, P&G, HSN, and LEGO. Before iCrossing, Alex led the Toys''R''Us strategy and operational transition from the Amazon.com partnership to its current standalone operation, and directed online marketing for the resulting $500MM online business. Alex began his career in business strategy consulting at Wunderman/ Y&R. He holds an MBA from Yale University and is based in New York.

Related Topics

Connected TV and OTTPerformance Marketing

Get the daily newsletter digital marketers rely on.

Processing...Please wait.

See terms.

ATTEND OUR EVENTS

The MarTech Conference logo.

June 7, 2022: Master Classes

September 28-29, 2022: Fall

Start Discovering Now: Spring

Learn More About Our MarTech Events

The SMX Conference logo.

June 14-15, 2022: SMX Advanced (virtual)

November 14-15, 2022: SMX Next (virtual)

March 8-9, 2022: Master Classes (virtual)

Learn More About Our SMX Events

Webinars

Benchmark Your Social Media Performance For a Competitive Edge

Take a Crawl, Walk, Run Approach to Multi-Channel ABM

Content Comes First: Transform Your Operations With DAM

See More Webinars

Intelligence Reports

Enterprise SEO Platforms: A Marketer’s Guide

Enterprise Identity Resolution Platforms

Email Marketing Platforms: A Marketer’s Guide

Enterprise Sales Enablement Platforms: A Marketer’s Guide

Enterprise Digital Experience Platforms: A Marketer’s Guide

Enterprise Call Analytics Platforms: A Marketer’s Guide

See More Intelligence Reports

White Papers

The State of Influencer Pricing

How to Measure Influencer Performance

Reputation Management For Healthcare Organizations

Unlock the App Marketing Potential of QR Codes

Realising the power of virtual events for demand generation

See More Whitepapers

Receive daily marketing news & analysis.

Processing...Please wait.

Topics

  • Transformation
  • Operations
  • Data
  • Experience
  • Performance
  • Management
  • All Topics
  • Home

Our Events

  • MarTech
  • Search Marketing Expo - SMX

About

  • What is MarTech
  • Contact
  • Privacy
  • Marketing Opportunities
  • Staff

Follow Us

  • Facebook
  • Twitter
  • LinkedIn
  • Newsletters
  • RSS

© 2022 Third Door Media, Inc. All rights reserved.