Up until now, the best time to advertise has always been when most people are watching. It is the reason that the Superbowl has the most expensive adverts in any year. It is also the reason that many of these are not targeted at any particular audience.
Programmatic in TV advertising could change this though, bringing the targeted aspects of online advertising through to TV advertisers.
Through algorithms and cross platform data integration, it is possible for companies to now have detailed knowledge of the kind of programmes that particular demographics watch. This can be incredibly precise, from 50-60 year old females who use iPhones to 12-18 year old males who like Kanye West.
With this kind of information, it becomes possible to target on screen advertising to suit these people.
The problem with this gaining more traction is simply that TV companies are making a lot of money from their advertising already. In order for effective programmatic programmes to take place, they currently require first considerable stock to advertise against, something that the internet has in abundance but TV ads do not.
This means that many TV executives are unwilling to make changes to how they currently schedule advertising simply because with the limited numbers of ad slots available, they have the opportunity to keep the prices high.
Using programmatic would mean that companies could bid for advertising space based on how relevant it is to their adverts. This is similar to how Google ads work in terms of putting in a maximum bid then placing ads based on who has the highest bid for that particular slot.
At the moment, there are some smaller cable channels who are using this method. This works well for them simply because they have a high amount of stock which is relatively low value compared to larger networks.
At the moment the UK market sells around 10% of its TV ad space through programmatic, whilst the US lags behind at roughly 1%, but this number is likely to increase in the future.
The reason for this growth is simply that marketers want to be able to sell their products to the right people at the right time. They have got a taste for this from their online efforts and now want to be able to mimic this through all forms of their advertising.
As this increases, it is always likely to be in the lower value brackets, where the advertising slots do not have the considerable price of other areas, but instead allows advertisers to target specific groups with the products that are best for them.
Are we ever likely to see programmatic advertising at the Superbowl? Not with the way things are going, but who knows, in 20 years we may be able to bid to have our name in lights across the world’s biggest sporting event.