• by Mitch Oscar , Charlene Weisler , November 6, 2015

Recently, Charlene Weisler and I allowed some of the prominent programmatic TV players to speak for themselves rather than through our vivisection of their value proposition. We started with data-ists Rentrak and Oracle Data Management Platform. This week we’ll continue with platforms TubeMogul and Videa.

For continuity, we’ve asked that the participants succinctly answer a series of queries:

1. Company description
2. Utilization of data for promoting the value of TV inventory
3. Early experiences and subsequent evolution of value proposition
4. Biggest hurdles and applicable lessons
5. Recommendations for adoption

A Platform’s Perspective

TubeMogul: Jason Lopatecki, Chief Strategy Officer

Videa: Brad Smith, SVP, Revenue and Operations

Question: Please provide a brief description of your company.

Jason Lopatecki: TubeMogul offers a self-serve software platform that enables brand advertisers to plan, buy, measure and optimize their global brand advertising campaigns across desktop video, mobile and linear TV. The platform both provides access to RTB-based inventory on ad exchanges, and enables direct buys from premium publishers.

Brad Smith: Videa is a supply-side platform that brings automation and data-driven targeting to the buying and selling of television advertising. We enable local broadcasters to monetize their inventory while opening new demand channels to enhance the value of spot television at scale. Owned by Cox and backed by a management team with television expertise, Videa’s technology provides stations with a data-driven platform that complements the traditional television buying process to deliver pricing and yield optimization as well as audience-based targeting. Videa enables advertisers and agencies direct access to purchase the entire schedule of local broadcast television inventory, including access to high-demand, premium programs.

When did your company enter into the programmatic space (digital, if applicable and TV) and for what reason?

Jason Lopatecki: TubeMogul launched its programmatic software platform in 2011. We focused on digital video across desktop, mobile, and connected TV. However, in response to advertisers who wanted to apply the benefits of automation and data-driven targeting to other channels, we launched PTV – the world’s first self-serve software platform that automates the buying of TV – in December 2014. Since launch, Mondelez International purchased the first-ever broadcast TV Super Bowl ad programmatically through our software, and DigitasLBi secured ad time during the Oscars. Cox Media, the advertising arm of Cox Communications, made local network inventory from their full footprint available to purchase through TubeMogul PTV.  We’ve also partnered with Site Tour in Australia to bring programmatic capabilities to digital out-of-home, and believe that eventually all other channels will be bought through software.

Brad Smith: Videa launched in beta in December 2014 and has worked with station groups, agencies and rep firms across the linear TV ecosystem to build an automated television solution that optimizes advertising campaigns and enables workflow efficiencies and data-enhanced audience targeting.

What did you learn from that experience that is applicable for your expansion into the programmatic TV space? (TubeMogul question)

Jason Lopatecki: We knew that advertisers wanted a single platform that could unify their entire brand advertising efforts. Marketers were incredibly receptive to the idea of planning and buying multiple formats, across multiple devices, from a single dashboard with the ability to quickly evaluate performance and shift budgets in real time. This led to a restructuring of how they did business, typically shifting from an RFP model to a self-serve model where traders with specialized training executed campaigns.

We designed our software with the user in mind, and created the educational infrastructure to ensure that anyone could leverage our software with the same flexibility and understanding as our internal platform teams. Extending our platform’s functionalities to television was the logical next step.

What have you learnt from your company’s local broadcast, cable and cross-media campaigns that is applicable for your expansion into the programmatic TV space? (Videa question)

Brad Smith: We know how TV advertising works, and we understand how valuable it is as an advertising medium.  However, the difficulty to plan and execute a buy has eroded some of that value from television.  Traditional TV advertising buying can take anywhere from a few days to weeks, and there are countless potential points of failure because of the manual nature of the process.  To buy locally, agencies have had to put significant human resources against the endeavor -- and even then, there’s no guarantee they will get what they actually bought.  We identified what is fundamental and essential to build into the programmatic platform.  We are creating the same ease of execution regardless of platform, and creating value for both the station and the agency.  

What have been your biggest hurdles as you endeavor to deploy more programmatic TV campaigns?

Jason Lopatecki: It is not uncommon to encounter legacy contracts where one agency is a brand’s TV buying agency of record and another handles programmatic buying. Some agency teams are combining not just TV and digital units into a larger “video” team, but are also putting programmatic specialists and media buying teams together.

We have found a lot of confusion in the market around what inventory is being purchased and how rates are calculated. This stems from transactions that have a mix of local and national inventory without clearly defining what inventory is what, along with non-transparent methods of impression calculation. Many TV networks and MSOs associate the word “programmatic” with downward pressure on prices and real-time bidding. Really, programmatic TV is more akin to the programmatic direct market in digital video advertising, where inventory is scarce and buys are typically done on a fixed-price basis. “Programmatic” simply means that marketers are using software to automate buys and make data-driven decisions.

There is also some confusion on the buy-side on the difference between “addressable” and “programmatic” TV. The latter simply automates the process for planning and buying, allowing advertisers to apply data to inform which networks, timeslots, shows and more to buy. True addressability is different, and is made possible through the MSOs and MVPDs enabling you to buy specific households. Ironically, much of the addressable TV that is bought from MSOs today is done on a managed-service basis.

Brad Smith: The biggest hurdle we have faced is the concept of mutual adoption in order to get scale.  While both the buy and sell sides agree there is a problem, changing legacy behaviors that are ingrained in the way business is currently transacted will take time. Videa is working to establish agreement on the parameters of transacting programmatically, and while stations have been willing to give it a chance, agencies are still doing business as they have always done.  It’s a bit of a chicken and egg concept, but both sides need to buy into these newly established parameters in order for significant dollars to begin to move over to programmatic TV platforms. 

Any recommendations for programmatic TV platforms, to help facilitate the use of the programmatic concept by traditional agency TV buyers and planners?

Jason Lopatecki: The way programmatic TV is bought should allow for an easy move from the currency TV buyers use today, while also allowing for greater flexibility in a new world of more-targeted audiences. That means offering TV buyers both traditional on-target CPMs for a specific age and gender, as well as an on-target CPM for a strategic target beyond simple demographics.

Supporting both in the interim allows the move between a purely demographic-based currency to a world where the currency will be addressable audiences. Given that we are in the early days of programmatic TV, advertisers should demand not only full reporting, but also a product demonstration -- as well as the ability to login and execute themselves.

Brad Smith: Videa has always believed it is important to coexist with existing sales channels at both the national and local levels.  This is why we see our relationships with the rep firms Mediaocean and Videology as vital. 

We want to provide the advertisers access to our clients’ inventory without disrupting their current workflow while layering efficiencies into the process.  People will continue to play an integral role in the selling and buying of television advertising, but we are enabling them with technology to make more-informed decisions.  It’s an ecosystem that we’re helping to become more efficient and maximize the power of broadcast television.

This post appeared as a previous version of Audience Buying Insider.