How premium programmatic video is evolving

Leo O’Connor, senior vice president, advertising, Paramount

Change in the advertising and media industry often feels slow and chaotic — but when viewed with perspective, change happens relatively fast and follows a logical path. This is certainly the case with programmatic advertising and the rise of streaming. 

Audiences want the freedom to watch content however they want, whether live or on-demand, on TV glass or their phone. And they’ll find a way to watch it in the best way possible, whether that’s subscription video on demand (SVOD) or a free-ad supported TV (FAST) platform. 

Meanwhile, advertisers want effective targeting and frequency management tools to place ads against high-impact, brand-safe environments, and that can be accomplished with programmatic-enabled connected television (CTV) solutions. Advertising on CTV offers marketers access to platforms with premium content bolstered by data-targeting capabilities. 

The execution of programmatic advertising on CTV — for instance, in an episode of ‘CSI’ viewed on Pluto TV, a FAST platform — is far more complex than the banner version of programmatic where this technology was born more than 15 years ago. On CTV, multiple auctions are conducted in real-time, stitched into ad breaks, subject to competitive separation and frequency caps, and displayed to the end user. The technology that powers programmatic ad auctions is now operating at scale against the most premium long-form content available: full-episode television, on the big screen, in the living room, via CTV. 

CTV programmatic offers premium scale, speed and simplicity

When watching traditional TV, viewers are accustomed to ad breaks hand-stitched by a human being, which is the norm for linear television. This user experience is the bar for streaming platforms: broadcast-quality ad breaks executed programmatically. 

The growth of programmatic in the CTV space has happened because it is beneficial to both buyers and sellers. Marketers recognize the value of advanced targeting, centralized reach and frequency management — and publishers recognize value from greater demand variety, which increases yield and improves the ad experience.

Programmatic solutions also allow advertisers and platforms to execute deals quickly. For instance, buyers can be set up on Paramount’s EyeQ platform and purchase premium long-form video at scale within 24 hours. The speed and scale of CTV advertising is a big draw for advertisers across categories, including packaged goods, beverage, auto, insurance and retail — especially as marketers increasingly seek turnkey solutions.

Balancing the needs of marketers and publishers on CTV

Marketers often cite flexibility as another benefit of programmatic buying. Real-time bidding, after all, is the underpinning of programmatic transactions, and the capability is certainly there for investment to be paused or redirected on a dime. 

That said, CTV must strike a balance between this real-time flexibility and the predictability publishers and marketers need to operate a stable business. Across every hour of every day, streaming platforms must have a foundation of predictable ad creative to serve audiences high-quality ad breaks. And that is impossible if all demand is variable. For marketers, access to predictable, stable ad avails is critical to managing reach and delivery. The upfront is the clearest example: buyers can lock in predictable ad inventory in advance.

Because of this, it is essential that, as an industry, CTV continues to evolve programmatic transactions to bring the best of “real-time” together with planned, guaranteed investment. There have been promising strides toward this reality in coordination with advertisers and tech partners, with the hope that 2023 and beyond will bring innovation in programmatic while keeping the value of the upfront intact. It is critical for the health of the CTV ecosystem.

Sponsored by: Paramount Advertising

More from Digiday

How to have hard conversations as a manager: The Return podcast, season 3, episode 4

To get a better understanding of why the people part of management is so important, we spoke with Julia Toothacre, a career strategist.

How Digitas North America’s Leah Askew is looking to rein in the agency’s programmatic supply sources

This year the agency plans to exit the programmatic open market and only purchase auction packages through PMP deals with a limited number of SSPs.

Publisher execs talk AI licensing deals, new applications for AI in latest earnings calls

Publicly-traded media companies touted new deals with generative AI tech companies and other new applications for the technology in their Q1 2024 earnings calls.