From Ad Buy to Delivery: How Programmatic Is Streamlining the TV Ecosystem
In recent years, legacy media companies and streaming platforms have mostly amassed content, technology, and audiences independently of each other. The result is a fragmented experience for advertisers and audiences that leaves room for improvement. Convergence around planning, execution and measurement is needed to make this experience more efficient for all parties.
Magnite’s Chief Revenue Officer, Sean Buckley, recently sat down with industry experts from Fox, Disney, and Warner Bros. Discovery to discuss how the modern TV ecosystem can collaborate to create a more streamlined path forward.
Programmatic is simplifying the ad sales process.
Programmatic offers brands a more efficient path to purchase, enabling marketers to access streaming TV inventory from one point of entry. With programmatic powering streaming TV, brands are reaching addressable audiences at scale via a simpler ad-buying process — which is perhaps why more video ad dollars are transacted programmatically. In fact, the amount of money US advertisers spend on digital video programmatically will surpass linear TV ad spending this year, per eMarketer. Furthermore, nearly 9 in 10 digital video ad dollars will transact programmatically for the next few years.
Panelists echoed this tilt toward programmatic buying during this year’s CES. As SVP of Ad Sales Planning and Operations at Warner Bros. Discovery, Jill Steinhauser shared, “I don’t think we had one conversation this last upfront cycle that didn’t include programmatic, whether it was taking your guaranteed budgets upfront or running them through Programmatic Guaranteed deals (PGs). The request for biddable inventory keeps coming. Ease, flexibility, and a clear ROI, that’s what we’re looking to offer our buyers via programmatic pipes.”
Many streaming platforms are currently working with a mix of biddable and direct inventory, and programmatic buying helps platforms measure and benchmark all of their inventory holistically.
SVP of Data Strategy and Sales Innovation at FOX Corporation Dan Callahan added to this point, sharing, “Operationally, systematically, and business-wise, a linear trafficking system and a digital trafficking system work very differently. Ideally, the tech stacks would work together and allow the left hand to know what the right hand is doing. Programmatic is part of that.”
Live linear is a bright spot for streaming TV.
Live TV is often seen as the crown jewel of TV, especially when it comes to sports. Live sports programming works hard for advertisers. According to Magnite’s research, viewers who stream live sports show higher levels of engagement with TV advertising and are highly receptive to ads. Nearly half of live sports streamers (49%) agree with the statement, “TV ads are an important part of my TV-watching experience.”
As linear and streaming TV converge, streaming companies are leaning into live TV content on their platforms to great effect.
SVP of Addressable Sales at Disney Advertising Jamie Power shared, “The more choice and control we can give to advertisers so that they can capitalize on big sports moments, the better. At Disney, we work with companies like Magnite to ensure our tech stack supports live sports and event viewing.”
Steinhauser echoed that programmatic ad buying also offers a lot to live sports viewing. “Traditionally, even in the digital landscape, live sports have been sold heavily direct. But there’s no reason why we can’t sell biddable inventory at maximum yield within those live streams. With programmatic, we’re lighting up more sports-based live impressions.”
Measurement and attribution continue to be north stars.
As more agreement happens around standardized measurement and alternative currencies, streaming platforms can better “show their work” to advertising partners.
“Our hope is that improved measurement will help us tell a better story about the audience in its totality,” Fox’s Callahan explained. “Regarding currencies, change is imminent. The question is – how long before we establish an apples-to-apples benchmark for measurement alternatives?”
With improved measurement and more accessible inventory, media platforms are getting a greater share of ad dollars. This has enabled streaming platforms to become bigger stakeholders, ceding investment away from social platforms and walled gardens.
“At Disney, we’ll support everyone from a local florist to a Fortune 500 brand,” Power said. “On our self-service platform, we have deals that range across all sizes and scopes. Streaming’s opened up a lot of TV inventory that was harder to access before.”
Both interactive and classic ad breaks work — as long as they’re high quality.
The consumer experience is changing in a more streaming-centric world, but classic advertising tactics aren’t going anywhere. Media companies are leaning toward the flexibility to serve ads at optimal load and duration time to users.
As Warner Bros. Discovery’s Steinhauser put it, “You can flex breaks; you can create new ad units; you can go a little non-standard for special sponsorships and whatnot. We can’t afford to lose our audience, so we have to push back on churn. Even in an ad-lite model, which is still extremely short of a traditional linear load, you never want to create a bad ad experience.”
That said, classic ad experiences have staying power. Instead of chasing a trend, do what works. Callahan shared, “We offer different ad breaks, overlays, and QRCs. However, I do think traditional advertising – fifteens and thirties – also work. There’s something to having those unified formats that are accessible and adaptable across all platforms versus chasing a unique integration.”
Magnite’s Buckley highlighted that regardless of ad format, quality is king. To meet audience expectations, it’s more important than ever for streaming platforms to avoid poor ad quality, duplication, and waste.
Overall, as ad sales and delivery in streaming environments become more consolidated, advertisers and publishers stand much to gain. Advertisers can access a library of premium video inventory in a cleaner, more unified way, and publishers can monetize their content more effectively.
“This year, we’ll continue to deliver premium content that we know will convert against our clients’ goals,” Power said. “We have the benefit of an amazing portfolio of assets. Our tech stack is set up to help our platform use our content to deliver on advertisers’ KPIs.”