Television’s digital disruption differs from cable for one big reason—advertising. When a wave of new networks swept over TV in the 90s, television advertising retained its core value proposition of controlled delivery to large audiences within quality, brand-safe entertainment. Contrast this with CTV advertising’s potential for uncertain delivery to fragmented audiences within, well, some type of content—or worse, ads never serving at all due to scammers spoofing CTV inventory. For the world’s largest advertising medium, this fundamental shift casts shade on the narrative of an ideal union between brand and performance marketing. But it is correctable.
When CTV first began attracting attention from marketers, exchanges turned to deals for help. By manually packaging inventory, supply platforms worked around the lack of TV-relevant real-time bidding (OpenRTB) signals and limited invalid traffic protections. Direct buyer-seller connections also emulated TV’s sales model, making it easy to port legacy practices online. In effect, deals became the proxy for inventory signals, quality control and security—no innovation required (just plenty of manual work).
Ad tech’s role? Simple: generate a deal ID for the buyer to target and confirm that the supplier configured its ad server to deliver. So, while rapid innovation was redefining internet-enabled TV from mail-order DVDs to streaming apps and evolving the experience from buffering wheels to instant viewing of live and on-demand content, ad tech was taking functionality it developed a decade ago to automate insertion orders and … repositioning it.
Exchanges first resorted to deals out of utility, but as CTV impressions double year-over-year, little has changed. Satisfied incumbents enjoy increased investment quarter after quarter as brands follow consumers, yet CTV continues to rely on programmatic’s pre-exchange, pre-header bidding waterfall rendition of yesteryear, and a marketplace in which sellers don’t define their products and buyers don’t know what they are buying.
If programmatic advertising is to be taken more seriously by the television industry, it must begin to close the gap between existing tools and the needs of TV buyers and sellers. Programmatic standards were established for web display, not commercial breaks, and without an identifier to connect viewers as they move from app to app, reach and frequency management and addressability remain CTV aspirations. Media owners can’t combine audiences for show or even channel-level scale, and buyers struggle to enforce basic campaign rules while inadvertently competing with themselves for the same impression from multiple sources.
Redefining connected TV
An OpenRTB spec that speaks the language of TV is actively in the works, but it must go beyond the lexicon to account for the intricacies of TV campaigns and the business challenges posed by TV’s digital transformation. Consider inventory signals. It’s no secret that CTV identifiers are badly needed, but media owners obfuscate content data to avoid sales conflicts with distribution partners and limit the risk of high-value commercials being commoditized. Expanded taxonomies don’t fully address these challenges, leaving buyers to search for “living room quality TV inventory” across a landscape dotted by bizarre apps and provocative programming with no means of telling one from the other.
Together, ad tech leaders and television executives can literally redefine connected TV, but until buyers know who they are actually buying from, a rich CTV marketplace won’t be realized. The SupplyChain Object was created to detect and deter fraud on the web and in-app—now it’s time to demystify the complicated supply path of CTV impressions with a common framework for server-to-server transactions. Index Exchange co-authored ads.cert 2.0 and the cryptographic security protocols designed to secure the CTV supply chain. Adopting these standards will give advertisers and publishers full visibility into each transaction and confidence in the legitimacy of each impression.
Television deserves to be enhanced by ad tech, not force-fit into an ad server. A dynamic CTV marketplace can replace inefficient inventory reserves, increase transparency and drive transaction costs down. A data-infused forward market can modernize upfronts and increase competition for premium supply while preserving the valuable relationships that have fueled TV for decades. CTV really can deliver that ideal combination of immersive brand experience and precision delivery for advertisers, and programmatic really can improve yield and sell-through for TV media owners.
We’ve got work to do, but we will get there.
Resourcefulness with imperfect tools jump-started CTV; now innovation must help television realize the true value of programmatic advertising.
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