Forrester: Programmatic TV Will 'Evolve Pragmatically'

Programmatic TV adoption is on the horizon, with multiple firms investing in real-time TV-buying capabilities. The prospects for stronger adoption rose with news of the AT&T and Time Warner merger, and will continue as more users move toward OTT TV.

Still, “whatever happens in TV, it’s not going to look like what happened in digital,” said Jim Nail, principal analyst at Forrester, speaking at AdExchanger’s Programmatic I/O’s conference last week.  “The challenges that need to be addressed in TV are not those that digital has to deal with.”

Nail noted that digital’s difficulties online included excessive inventory and a lack of effectiveness in direct selling, while in the TV industry there is a stronger supply-and-demand balance, as well as much more high-value inventory.

Those moving into programmatic TV will also have to deal with seller reluctance from traditional buyers not yet convinced of real-time benefits.

There are also issues with measurement. TV has a deeply embedded process that cannot be effortlessly modified to fit the digital models now in use. Also, the data available to online marketers is not yet standardized with TV interfaces.

Further, ad-buying practices are not in tune with what is expected in the TV space.

Still, the way TV advertising is bought will become more real-time, as impressions, conversions and creatives quickly become digitized, Nail said.

He did have a solemn note for those in TV buying: “Entry-level digital buyers who are in the TV space need to find new jobs. When these systems get integrated, they will be out of a job.”

How quickly that will happen is up for debate, and will surely depend on variables defined by the TV industry. In the end, “TV will evolve pragmatically, not programmatically. Programmatic TV will have to solve for different problems than were solved in digital -- there will be a hybridization of the best TV and digital approaches,” said Nail.

In essence, TV will move in the programmatic space focused on audience targeting, not necessarily optimizing for the real-time nature of buying as we saw with online programmatic.

1 comment about "Forrester: Programmatic TV Will 'Evolve Pragmatically'".
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  1. Ed Papazian from Media Dynamics, November 1, 2016 at 10:28 a.m.

    A well thought out and sobering perspective from Jim Nail. I would also add that aside from seller reluctance to participate meaningfully, programmatic TV will make little progress in key sacred cow/"must buy" areas ---like sports, news and primetime entertainment-----as these are not nearly as CPM - driven as time in other dayparts. Also, the upfront concept, with its "corporate" buying approach, rather than brand by brand negotiations, must be defeated or greatly altered before programattic TV can provide whatever targeting benefits it may have. That's unlikely to happen ---even in the long run.

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