2017 is The Year for Programmatic TV Advertising

This article was originally published on MediaPost

2016 will be a big year for linear TV demand.

Why? “With the U.S. presidential election and the Rio 2016 Olympics, linear television is likely to be tight next year, despite shifts in consumption habits. From the broadcaster and pay TV providers’ perspective, the need to move quickly on delivering audience-based solutions may be somewhat mitigated by the expected scarcity in the marketplace.  However, consumer viewing habits across screens will continue to evolve, thereby fueling marketers’ interest in cross-screen, data-driven and audience-based buying solutions.”

Now here’s a bold prediction: Ferber bets that 2017 will be the year that big dollars begin to flow to data-fueled, audience-based, automated TV advertising. 

“The 2016/2017 TV upfront will mark the start of serious discussions about audience-based TV buying. The result will be a year filled with advanced TV testing and a ramping up of technology infrastructure to prepare for future shifts toward programmatic solutions of various forms. All of this will set the stage for real dollar movement in the 2017/2018 upfront.”

Whether you love ‘em or hate ‘em, the TV upfronts and video NewFronts will continue to thrive. Why?

“As we move toward audience-based buying and multiscreen convergence, the continued relevance of a TV upfront and the necessity of the video NewFront is often questioned.  However, the number of media companies participating in the NewFronts continues to grow.  This speaks to the fact that certainty — i.e., that ability to buy fixed cost fixed volume inventory — still matters. 

“It’s becoming clear that RTB isn’t the answer for constrained, scarce markets like premium TV or video inventory.  Think about it. Macy’s can’t find out on Saturday that its campaign under-delivered for Friday’s one-day sale. There’s a premium to certainty — and that’s what both the upfronts and NewFronts offer advertisers.”

First-party data will become more actionable — and more valuable. 

“Advertisers sit on mounds of first-party data that could do more to drive business outcomes than any third-party data ever could.  But many have been reluctant to activate this data for a variety of reasons, including technology constraints and concerns over security. 

“Now, as solutions for using first-party data evolve, more advertisers will begin to activate their data in 2016.  As a result, advertisers will become more educated and involved with technology decisions, both directly and through their agencies, in order to ensure that their data is protected.”

Mobile will be the next distribution channel for linear TV. 

“Mobile is already the central connection point for most consumers, and its strength will keep on growing as it becomes another distribution channel for live, linear TV. With the ubiquity of 4G across the U.S., the ‘pipes’ into the home — once controlled primarily by cable and satellite providers — can now sit on the smartphone.  Content can then be streamed to the big screen or other devices. This will redefine and evolve existing pay TV providers’ business models.”

A growing interest in media-mix allocation will fuel greater consolidation of the tech stack. 

“Fragmentation of viewing across screens is the new reality.  In order to reach consumers at scale, advertisers need to begin thinking in terms of cross-screen models.  And for those that do, the resulting outcomes — including sales lift — are substantial.  But the deployment of multiplatform campaigns can only happen if siloed technologies and data converge.  Look for more consolidation between technology companies in the coming year, and an uptick in converged cross-screen advertising solutions.”

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