March 18, 2016

Mediatel "Why Programmatic Video Is Changing the Game" - James Patterson

http://mediatel.co.uk/newsline/2016/03/18/why-prog...

James Patterson

It's time for TV buyers to demand the same level of performance they've come to expect online, writes The Trade Desk's James Patterson.

As everything shifts to digital, the power of now - and the immediate gratification that comes with it - is especially relevant for TV viewers. Why succumb to the rigid scheduling of cable programming, when users can freely watch episodes - even entire seasons - whenever they want, at a lower cost?

This highly curated TV experience is causing viewers to rethink whether or not the cable cord is even necessary. In turn, advertisers are beginning to rethink how to reach them. With all the data available to marketers from consumer connected TVs and devices, linear TV advertising is becoming both ineffective and inefficient.

Although, there's no question that data-driven marketing is shaping the future of how we engage with ads, has a banner ad ever made you cry? Me neither. For this reason, television and video remain, and will continue to remain, the gold standard for brand advertising.

From Budweiser's infamous 'Lost Dog' ad to Google Chrome's 2011 'Dear Sophie' ad - video has a way of connecting to consumers on an emotional level that is difficult to accomplish with banner ads alone. Imagine combining the power of programmatic - precision, insights, and optimisation - to the creative resonance of video creative.

The good news is it's not a pipe dream, it's happening now. Programmatic video is already gaining a stake in the United States market, which is paving the way for the United Kingdom to follow suit. Here's why programmatic video is on its way to changing the game.

Spend is beginning to shift to programmatic TV

With the ability to buy and sell TV ads in real-time, messaging can be more relevant and targeted than ever before. Programmatic TV enables brands to reach consumers who are actually interested in their company, and in turn, efficiently stretch their budget.

Why cast a wide net of targeting to consumers who might be interested, when it's possible to know - with a degree of certainty - who will engage with your brand. As the technology and trend continues to grow, so does the programmatic spend.

In 2014, programmatic accounted for 2 per cent of US TV spend and grew to four per cent, or $2.5bn dollars in 2015. This number is expected to quadruple in growth by 2017, accounting for 17 per cent or $10bn, according to Magna.

Meet the cord-users, the cord-shavers, the cord-cutters, and the cord-nevers

As the TV industry evolves, viewership patterns are becoming extremely fragmented. Not only can users access TV/Film at any time on one of their average three to four connected devices, but many users are also changing the way they gain access to content.

There are cord-users (the people who remain loyal to their full package television provider), cord-shavers (the people who reduce their package and subscribe to one to two streaming services), cord-cutters (those who have jumped ship from television providers in favour of subscription services), and cord-nevers (the individuals that have never had a television package, and solely rely on streaming services).

Fragmented viewing means enhanced targeting possibilities

These subset categories of viewership mean it's harder for marketers to reach a broad audience at scale in one fell swoop. Instead, marketers have the power to know specific interests and preferences of their audience. The days of buying ad time with the intention of reaching broad demographics are numbered. In this world of user preference viewing, shouldn't ads reflect the user's interests, too?

The more viewership continues to fragment, the more precise and specific targeting gets. By using rich digital data sets in combination with TV data, advertisers can determine whether their ads are driving consumers to visit their website, and what actions they are taking once there.

In turn, marketers efficiently use their budget towards likely candidates and viewers have a better user experience with ads customised to their latest interest.

By now, the secret's out: programmatic is necessary for running a successful, and efficient, campaign. It has evolved and improved each medium, from desktop to mobile and everything in between, and is taking on the best - and possibly the most primed for change - for last. It's time for television buyers to demand the same level of performance they've come to expect online.