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Programmatic TV: Moving across the pond



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June 22, 2015 | 5 min read

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Earlier this year, almost 115 million Americans watched the New England Patriots beat the Seattle Seahawks in a nail-biting clash to win Super Bowl XLIX. While this record rating share made history, it wasn’t the only thing to affect the TV advertising industry that weekend.

A week before the Super Bowl, a premium spot during the Super Bowl came up for grabs in Erie, Pennsylvania – a rustbelt city on the shores of Lake Erie more known for plastics production than advertising innovation – and Mondelez grabbed the opportunity. But it didn’t make its purchase using old –fashioned methods. Instead, the company bought the ad programmatically, making Oreo the first brand in the world to air an ad that was targeted through software via programmatic TV (PTV). From campaign ideation to delivery took just one week, shaving at least two months off the standard length-of-time required to book and air an ad.

Following the ad buy, Laura Henderson, associate director of media and communications at Mondelez told AdWeek that the purchase of the Oreo ad “is just a glimpse of the future of automated TV ad buying. (The purchase) is more about showing what’s possible and showing where this is all going.

“This pilot will help us learn how to transform media buying with leading-edge technology. Data-driven buying is the future of TV and media.”

While Mondelez has not used programmatic TV to purchase another ad since the Super Bowl, it has not ruled out the possibility. Others, however, have since followed Mondelez’s lead with nine spots purchased programmatically by ad agency DigitasLBi using the TubeMogul platform for the Oscars telecast.

So what does this mean for television advertising? Until now, innovation and change in advertising has largely focused on creative, with campaign purchasing methods changing very little since the early days of prime-time. As online video and mobile becomes increasingly hyper-targeted, brands are looking at TV (arguably the most powerful brand-building medium available to advertisers) and demanding similar levels of focus.

This month, TubeMogul released a white paper discussing programmatic TV for the UK market, which is expected to be the next destination where PTV will make an impact. As part of the research, TubeMogul interviewed a collection of brands, broadcasters and media agencies to determine the viability of PTV along with the challenges and opportunities offered by this new buying method.

Martin Galvin, digital trading director of Mediacom says: “From our experience, programmatically traded media is more efficient. And as a media agency, we clearly want to eke out maximum efficiency on behalf of our clients.”

But the UK market is vastly different from the US, primarily due to a lack of regional broadcasters with their own inventory to sell. There is no British equivalent to an NBC affiliate in Erie, PA. Add the dominance of a public broadcaster to the mix and what you get is a significant lack of premium inventory combined with huge demand.

Because of these differences, the volume of inventory available using PTV will always differ between the two countries, with access to premium spots easier to secure in the UK – at least in the short-term. Despite this, there are still interesting inventory options in the UK that are being opened up by the introduction of PTV buying methods. One of the biggest opportunities is access to ‘zero-rated’ programming.

Currently in the UK, ratings are compiled by BARB using data generated by a panel of just over 5,000 households. Over 30 per cent or programmes currently broadcast in the UK secure a zero rating, which doesn’t mean that no one is watching. It simply means that no one in BARB’s limited panel watched the programme.

Kevin Longhurst, head of trading and partnerships at G14 says: “Brands marketing certain products could take advantage of zero-rated shows or less premium ad spots to put together a TV campaign. I would argue that there are opportunities for gaming companies and men’s lifestyle products because plenty of consumers playing things like Call of Duty are awake (during low-rated broadcast times), potentially using the TV as a second screen.”

So, while premium ad buys are starting to take off Stateside, the UK offers a more targeted approach. TubeMogul does not see PTV as a replacement for traditional ad buying and selling models currently employed for premium television inventory in the UK. Instead, we believe initial opportunities will lie in where it adds value as a complementary marketing tool to supplement premium ad buys. Two countries, one common goal in efficiency.

Nick Reid, UK Managing Director, TubeMogul



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