TV Gets With the Programmatic Program

Industry’s use of Web-style techniques varies across the advertising landscape

Why This Matters

WHY THIS MATTERS
TV programmers are continuing to experiment with digital ad techniques honed in the world of Internet video.

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By borrowing from techniques honed in the white-hot world of digital video, TV advertising is gravitating toward programmatic models that bring buyers and sellers together in an increasingly automated fashion.

While ad reps will be relieved to know that programmatic methods won’t overtake the traditional way TV ads are bought and sold anytime soon, progress is being made as agencies, vendors and programmers continue to experiment with and deploy new Web-style approaches.

What follows are examples of how programmatic techniques are starting to be stretched across the TV advertising landscape.

Cox Jumps In

Cox Media, the ad sales arm of Cox Communications, is well beyond the toe-dipping phase. It has taken the plunge.

“All of our inventory is available programmatically now,” says Mike Zeigler, VP of business development and operations at Cox Media. “There is no carve. We don’t consider it remnant business. We get rates out of programmatic that oftentimes rival our other sales channels.”

Cox Media’s programmatic activities go back a ways. It initially began to use impression-based ad sales more than two years ago, through a deal with Google, which helped the Cox Communications unit deliver a certain number of impressions over a specific time period regardless of where the ads aired in the MSO’s footprint. Google later withdrew from the TV ad market, leaving a void that Cox Media has since filled with the help of several partners, including Clypd, AT&T AdWorks and AudienceXpress (the programmatic division of Visible World). “Programmatic is an emerging sales channel for us,” Ziegler says. “It’s very important and it’s our fastest-growing sales channel.”

It’s also a tool Cox Media can use to secure a competitive position amid a growing group of rivals that are all trying to attract ad dollars.

Programmatic models “allow us to network ad impressions to compete directly with digital,” Ziegler says.

Programmatic has grown beyond an efficient way to sell unused ad avails into a popular option for premium ad buyers, he adds. But programmatic hasn’t replaced human beings at Cox Media, which relies heavily on a traditional sales force.

Do those reps feel threatened? Ziegler says he hasn’t seen evidence of that, but acknowledged it’s natural for salespeople to keep an eye on shifting trends and to ask questions about how emerging technologies might affect their existing client relationships.

“Ultimately, the value of transacting directly with one of our reps is the advice and the high-touch service that they provide,” Ziegler says, noting that programmatic is a means for transacting high-frequency business, but doesn’t hold the same value proposition as the feet on the street.

“But it’s inevitable that automation will occur,” he says, adding that ad buyers and agencies increasingly want to go directly to inventory owners.

ESPN’s Premium Play

While some of the early forays into programmatic TV tie in automated ways to pitch remnant inventory, ESPN is taking a different approach with its initial efforts. Its offer is as a premium opportunity.

ESPN’s first programmatic TV execution, launched in December, carves out a special advertising unit within flagship news show SportsCenter that does not affect its standard units. In those instances, the anchor tells viewers that the show will resume soon as the camera zooms into one of the multitude of video screens on the SportsCenter set, which then presents the 30-second spot within the show itself.

TurboTax is the first advertiser to jump on the opportunity, though ESPN is also holding talks with other advertisers about it.

“We’re excited about the idea that we’ve created a unique execution, and something that feels very premium,” says Eric Johnson, ESPN executive VP of global multimedia sales.

ESPN, in tandem with partners such as Clypd, is using a programmatic process to sell those ads. While there’s still some manual work involved, it’s conceptually a programmatic buy that uses auction-type selling.

ESPN views this as a first step, believing the process will become smoother and more streamlined in the months ahead. In the meantime, the network is in education mode.