• by Jeremy Ozen , March 10, 2014

Think about video ad buying: it’s usually coordinated through a buyer with very specific criteria in mind.  For the most part, ads are placed on certain websites, apps, and platforms directly by the buyer, or at the very least through an ad network that has pre-purchased such inventory.  With a limited amount of truly premium online video inventory, it can take a while to coordinate the logistics and make sure the right ads appear in the right location at the right time. 

Think about programmatic ad buying: it can be executed on a tight turnaround, without the use of an intermediary.  It requires availability at scale and data overlaid on that scale to yield optimal results. 

If presented with nothing more than the information above, you might think that programmatic video buying would be impossible.  But in fact, programmatic buying of premium inventory such as online and location-based video (and one day maybe even connected cars and digital billboards) is not just possible -- but more importantly, smart.

Limited Inventory

While video inventory is growing, there simply is not as much of it as there is display inventory.  Availability will inevitably continue to increase as viewing habits shift.  In the meanwhile, however, what we have is not only scarce, it’s also decentralized across multiple networks.  Buyers need to know exactly which networks to contact when they’re looking to buy video ads.  Not just who sells video inventory, but who sells the right video inventory for their audience and goals.

If all of that inventory were accessible via programmatic platforms, buyers would be able to get a snapshot of what is available, where and when, and how much it costs.  The efficiency of this model would allow for faster deployment of campaigns, and make room for more responsive campaigns that could be modified quickly according to consumer engagement.

Data-Driven

Because video inventory is limited in availability versus standard display inventory, programmatic should not be regarded as an opportunity to drive video prices down.  This is just simple supply and demand economics.  In addition, video is not a direct response medium where price is an integral element for success.  Instead, we should focus on the other major benefit of programmatic: the ability to make data-driven purchases.

All programmatic platforms offer some kind of algorithmic targeting.  Display algorithms are optimized for reaching customer conversion or acquisition goals.  In contrast, programmatic video algorithms should be tailored to reaching the right audience.  Given the high CPMs in video, it is even more important to use data to make sure a 15- or 30-second spot is getting in front of the right eyeballs -- each impression is worth that much more when a video is being served. 

Say, for instance, that a certain location -- physical or digital, a mall or an app -- has proven effective for video ads, but only at certain times of the day.  Working solo, a buyer would have to look at all available inventory one-by-one to find out the same information that the programmatic platform already has compiled and ready to deploy.  Targeting can get more granular than that with the right data, allowing companies to target their video to certain demographics, professions, and interests, ensuring that every dollar spent on video advertising is money well spent.  Plus, most programmatic providers offer detailed analytics of reach and ROI, something a buyer would be hard-pressed to compile and analyze on his own.

Now Available

While there’s plenty of video inventory that has not yet hit programmatic platforms, there’s also plenty that has, with more being added every day.  As video inventory grows (both online and location-based), it will become harder to manage on a case-by-case basis.  This will make the push toward programmatic even stronger.  So perhaps it’s time to start moving in that direction now: getting in early will mean greater success as programmatic video buying becomes the norm.