By Dan Ackerman, AOL
Another television Upfronts season is behind us, and while the key trends to emerge were far from surprising, they were certainly exciting from a technology standpoint. From the progression of programmatic TV to the emphasis on partnerships and quality content at scale, here are five insights from this year’s season.
Data is still king.
In 2016, data continued to permeate every conversation at the Upfronts. But, unlike last year when the focus on data was explaining why it’s valuable, this year, it was more about how data insights can be activated and packaged for extracting greater value. Whether you’re dealing with CRM data or cookie data for consumers in their stores and on their apps, advertisers on both the buy and sell side were especially keen on how data-driven insights could be packaged into a single, unified ad experience.
Capturing all that data and extracting its value remains a huge challenge, however, making back-end technology, such as multi-touch attribution, even more crucial.
Programmatic TV is becoming tablestakes.
This need for back-end technology to process data-driven ad buying is only fueling the growth of programmatic for linear TV. With every Upfront season, programmatic continues to occupy a bigger piece of the pie. In 2014, programmatic TV ad spending was just $50 million out of a total $70 billion TV ad market, according to eMarketer. But the research shows an upward trend, with programmatic TV reaching $11.48 billion by 2019, making up about 13 percent of television advertising spending.
This trend isn’t hard to understand, as advertisers and networks want to bring data-drive automation and the intelligence of programmatic and digital ad buying to linear television. There’s so much to be gained from better decision-making for hyper-targeted campaigns. And programmatic empowers networks to figure out how to optimize less valuable inventory that’s , undervalued by the panel based age gender demographic currency,too, to maximize sell through and yield.so nothing is wasted.
Past Upfronts provided more of a learning opportunity for programmatic, highlighting its potential, but we’ve moved past that. The focus this year was more on implementation and best practices — and that was exciting.
Measurement & analytics are critical.
The focus on programmatic implementation means the bar is raised for measurement and analytics. This was evident throughout the Upfronts. It’s so important to get campaigns to a specific population of consumerserson, through the right channels. Brands, advertisers and networks have started moving away from the broad demographic buckets of age, sex and race. The conversations are now are more like, how do you reach young, millennial males who buy Nike shoes every three months and order pizza on Fridays.
Consequently, the value of inventory is much greater, since the data is more important to marketers and TV networks than the typical blunt data buckets. Each upfront will contain more dialogue with audience data, which we’ll swap in for less-revelatory demographics.
Content partnerships for distribution.
Another big trend we’re seeing is in content on the distribution side. Networks and new media — Snapchat is a good example — alike are more willing to build partnerships with one another, instead of focusing only on driving people solely to their own platforms.
Everyone recognizes that you can’t ignore consumer behavior, and consumers are going to access content where and how they want it. There’s no going back from that.
The focus is on quality content.
That said, as technology delivers more targeted experiences across more channels, the demand for premium content from TV networks is only going to grow. The industry keeps talking about a slowdown in digital ad spending by the year 2020, but that’s more of a reaction to the current state of advertising, which is seeing tremendous progress and advancement. Ultimately, ad spend comes down to the quality of the inventory.
But premium content is still hard to come by, and that’s going to drive ad spending in greater part. The early days of programmatic were focused on data, but we now know it’s the content and context combined with that data that’s key.
We still need to figure some things out — standardization for measurement in mobile video, for example, which represents a huge, untapped market — but we’ll get there. The opportunity here is tremendous.
Dan Ackerman is senior vice president of programmatic TV at AOL.