TV Gets With the Programmatic Program

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

Johnson says the idea has been very well received, though there’s a learning process underway because the market still has differing views as to what “programmatic” means. As that gets sorted out, ESPN’s approach presents few risks, because it’s offered as an isolated 30-second spot outside traditional ad pods.

While the network doesn’t have plans to expand its programmatic ad inventory anytime soon, ESPN execs will look to apply more data and analytics that can result in more targeted advertising opportunities.

Super Bowl Pay Dirt

Anyone looking for a clear indicator that programmatic is ready to play on one of TV’s biggest stages need only check how the technology fared on Super Sunday.

Billed as the first Super Bowl broadcast- TV spots sold through programmatic technology, Mondeléz International bought space to run two 15-second ads for the Oreo and Ritz brands during the big game Feb. 1 on NBC affiliate WICU in Erie, Pa. The ads, which ran shoulder-to-shoulder, were purchased via TubeMogul’s programmatic platform, and through WideOrbit, its partner for the local broadcast inventory.

Seizing on the opportunity of the game, WideOrbit opened up a window into the inventory and established a bidding process.

“This was not a faux spot,” Eric Mathewson, founder and CEO of WideOrbit, says. “It went through the programmatic channel we have architected for the future.” WideOrbit has been finalizing a programmatic advertising system for local broadcasters that will expand to radio and cable networks later this year, Mathewson says.

The more-automated programmatic process did give Mondeléz International access to reports and affidavits on the spots the day after the game, rather than requiring the company to wait for third-party monitoring systems to deliver that data. Such deliveries tend to take 30 to 45 days, Mathewson says.

As designed, that quick turnaround will benefit buyers and could ultimately make such deals more attractive. “We think TV is undersold… and underappreciated by the buyers,” Mathewson says. “It’s more effective than people give it credit for.”

While this was a first, Mathewson predicts many more ads will be sold programmatically when the Super Bowl hits the big 5-0. “My guess is that there will literally be hundreds of them next year,” he says.

In addition to bringing more automation to the process, programmatic elements also extend to using data in a way that can help advertisers better target their products to potential buyers.

Mixing Art and Science

Adap.tv, the advanced ad unit of AOL, has overseen an array of programmatic-facing campaigns with that goal in mind and has seen some success in the early going.

Among recent work, Adap.tv hooked up with Art.com, an online retailer of posters, prints and framed art that had plenty of experience with digital advertising, but was looking to expand into TV in order to reach an audience it hadn’t touched online.

“The challenge was to reach a differentiated audience and to bring new customers in,” says Dan Ackerman, Adap.tv senior VP of programmatic TV.

To do that, Art.com tapped into Adap.tv’s Audience Path platform to create a programmatic TV plan that reached across the media landscape, ultimately resulting in a six-week campaign that touched three national broadcast stations and at least two-dozen cable networks.

Adap.tv, buying inventory on behalf of Art.com, created the campaign by analyzing about 200,000 customers, then profiling them using a proprietary scoring mechanism that stripped out personal identifying information, and generated two customer segments—young tech-savvy women, such as newlyweds and new home-buyers, and an older group of women determined likely to be redecorating their homes.

Art.com drove 77% more orders via the campaign, compared to more traditional demographic buys that targeted women 25-54, according to Adapt.tv.

Though Adap.tv is starting with a small base, its programmatic-TV efforts are growing at a high rate. Ackerman estimates the company will end the first quarter with more campaigns and dollars tied to its programmatic efforts than it did through the majority of 2014.

Related: Top Buyers and Sellers See Benefits In Programmatic Approach

Related:TV Ad Tech’s New Players

Related: For Programmatic Ad Tech, Efficiency Is Key Driver

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.

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