These are the problems holding CTV advertising back

These challenges are coming under the microscope as more advertisers embrace the medium. A report from video adtech platform Extreme Reach found that premium publishers ran more than half their video ad impressions on CTV in the fourth quarter of 2018, a 154% year-over-year increase.

Matt Timothy, chief revenue officer of Extreme Reach, told The Drum that all advancements in addressability and programmatic buying are “meaningless” without good creative, so as more advertisers dive into the space, the ad delivery process needs fine-tuning.

“The question really is where along the chain isn't there a pain point? Getting the right formatted creative is challenging and it takes time. If you don't have access to that directly, there's a chain that you have to go through from the creative agency to the seller's agent to whomever to source it, and then it may not be formatted right,” said Timothy.

One company that may sit along that chain is an online video platform like Brightcove. Its product marketing manager, Lexie Pike, said it will sometimes transcode an ad when it comes in to ensure the file’s quality, like audio normalization and resolution.

The problem with manually formatting an ad means a company like Brightcove may have to run slate and burn an impression opportunity.

Pike said this happens because platforms aren’t speaking the same language, whether that’s ad formatting, ad ingestion or simply communicating what a brand is advertising against.

“Today, a lot of people do this in a proprietary way. You have to have a million macros for a million different platforms and it's really inefficient. It becomes just a very manual process. It's almost like we're moving backward. Rather than automating it all, you have to communicate with the DSP, the SSP, the Brightcove of the scenario, the player and sort of translate what all these parameters mean.”

Some of those parameters can be as specific of the aspect ratio of an ad file to broader concerns like frequency capping and competitive separation, or avoiding a cluster of ads from the same brand category.

Craig Berlingo, head of product at video management platform Telaria, said ad pods don’t often fit together perfectly, and viewers can associate a poor ad experience with the publisher.

Managing competitive separation and frequency capping in what’s usually a 90-second ad pod can be a challenge when CTV ads can range between six and 30 seconds, especially when it’s all put together in near-real time.

“There are a lot of different ways to slice and dice that inventory, and as an ad platform there's a tremendous amount of demand out there that we have to sort through, apply the business rules, and then figure out how best to use those 90 seconds,” Berlingo told The Drum.

According to Roku’s head of ad platform, Youssef Ben-Youssef, issues over something like frequency capping often arise because there’s a lack of communication among a crowd of players.

“On the technology side, different publishers use different platforms,” Ben-Youssef said. “Each platform doesn’t talk to each other, which makes some of the targeting, or some of the frequency capping not optimal.

‘[Frequency capping] is mainly driven by the fact that that publisher might be using an ad server to fill that first impression, and then maybe using a supply-side platform to fill the second impression. That ad server is not talking to the supply-side platform and each of them doesn't know what's going on.”

Ben-Youssef added that these competing businesses don’t have any incentive to talk to each other, so ad standards from organizations like the IAB are important. The IAB Tech Lab recently released Vast 4.1, a video ad standard intended to streamline the disjointed CTV ad delivery process.

Some Vast 4.1 recommendations include a universal ad ID that is maintained across systems and support for raw, high-quality files so they can be stitched into a stream at the appropriate quality. Ben-Youssef said he believes industry adoption of ad standards will only help improve monetization in CTV.