Programmatic CTV Still Has a Lot of Growing Up to Do:But Why?

Programmatic ad targeting has enticed connected TV advertisers, thanks to its digital capabilities. The ad targeting automates the ad buying and delivery process. It also offers granular targeting options and real-time performance measurement.

Statistics say that around 87% of CTV ad inventory is transacted programmatically, and the number is likely to increase to 89% in the next two years. Despite its popularity among modern advertisers, Programmatic CTV is a complex ecosystem, and its fragmentation can make it difficult for advertisers to reach their target audiences efficiently and effectively.

Before we tell you why programmatic CTV has a lot of growing up to do, let’s tell you why it has become so popular among advertisers these days

We are living in a connected environment. It is easier for us to move from network primetime, adapt to the mindsets of the consumers, and create a personal primetime reflecting their preferred choices. However, we are still far from that point.

CTV is purchased through direct sales or from publishers. The ratio of direct and programmatic buying stands at 60/40, which is in favor of direct transactions. While the move towards programmatic CTV has accelerated, it still lags. As per a report, 94% of CTV inventory is still available to be purchased programmatically.

It is time to understand the benefits of programmatic streaming. Some of the benefits include:

1. Control

With the advent of automatic content recognition, you can account for linear viewership with digital exposures. It allows the programmatic buyer to control holistic reach and frequency inclusive of linear at the glass level. The advertiser can send messages to the viewer opts-in devices such as a mobile phone to help close the time of the transaction.

2. Flexibility

Programmatic CTV offers flexibility and operates in a market with very little need for commitments. The advertisers with shifting budgets can easily accommodate themselves, and they do not have a better way to transact rather than programmatic CTV.

3. Real-time targeting

Another benefit of programmatic CTV is real-time targeting. Ad makers can easily insert an ad right between a TV program to reach their desired audience. Such ads are hardly ignored. As viewing time shifts from linear to streaming, advertisers can take advantage of the CTV audiences that are available programmatically. Programmatic buying enables real-time targeting.

4. Reporting

With programmatic CTV advertising, advertisers will have data and reports at their fingertips. They can enjoy automated reporting and attribution on demand. In CTV advertising, viewership occurs in-app and the data is available with limited functionality. With a shift to programmatic advertising, advertisers can look at the views and easily understand what action the customers took.

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While these benefits are inevitable, there are areas where programmatic CTV lags. The areas to be improved are:

1. Transparency

With programmatic CTV advertising, advertisers will have data and reports at their fingertips. They can enjoy automated reporting and attribution on demand. In CTV advertising, viewership occurs in-app, and the data is available with limited functionality. With a shift to programmatic advertising, advertisers can look at the views and understand actions taken by the users.

2. Pricing

Another area that needs to be sorted is pricing. The pricing balance among linear TV, CTV, and programmatic CTV is needed. Expert must find ways to balance the costs incurred during the software installation and balance it against the efficiency of the same.

There is a need for a common currency that needs to be established so that advertisers and marketers can have their pool of savings.

3. Frequency Capping

It is one of the pain points of programmatic CTV ads that the industry has yet to work on. Part of the reason for this bottleneck is that advertisers are not aware of what they are putting their money into. An inventory overlap between programmers and their distributors confuses the buyers. Things are not very straightforward, and we must untangle them for the success of programmatic CTV.

There are other challenges as well in executing programmatic advertising, but these are the most notable ones.

Modern TV audiences offer advertisers a great chance to unlock the power of TV with the precision and accountability of digital, but this can be achieved only when we move to programmatic transactions. Programmatic CTV is still in its early stages but paired with more control and real-time accessibility, the powerful medium can be unlocked.

Wrapping Up

While programmatic CTV holds a future in its hands, there is still a lot of work to do to improve its efficiency. We know there is immense potential to be unlocked for advertisers and viewers alike, and we will see this field rising in the upcoming years. For now, we can go with the trend and adopt new feature as much as we can.

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