Commentary
Programmatic TV Market To Double
- by Daisy Whitney , Op-Ed Contributor, July 8, 2016
The programmatic video market continues to grow at a rapid pace. The latest estimate pegs programmatic TV spend to more than double over the next few years, according to a new report from eMarketer. Ad spend on programmatic TV should hit $2.16 billion next year, up from $710 million this year, the researcher said in its first-ever report forecasting programmatic TV. What’s more, it’ll double again and reach $4.4 billion by 2018.
Bear in mind that programmatic TV is still a drop in the proverbial bucket of overall TV ad spend, but its growth trajectory is significant and worth watching, especially since the race to dominate programmatic is on in digital video. Currently, programmatic TV represents 1% of total TV dollars, but that share should rise to 6% by 2018, the eMarketer report said.
Other studies estimate the TV market for programmatic to be bigger. In a report from last year, IPG Mediabrands Magna Global had predicted that $10 billion in TV ad budgets would be delivered through programmatic platforms by 2019, representing 17% of TV budgets.
Meanwhile, programmatic continues to be a huge player on the digital video scene and is on track to reach $5.5 billion in spend this year, accounting for 56% of the digital video ad market, said the researcher.
Expect programmatic spend in digital to continue to grow. In the first quarter of this year alone, the amount of premium video inventory available on a programmatic basis rose 22%, according to Ooyala’s Q1 2016 Global Video Index.
Looks like this article has popped up again. I grow weary of pointing out that programmatic buying for linear TV remains in its infancy and will remain so unless it is adapted to the needs of both sides of the equaltion---buyers and sellers.
Ed evolution of television supports numerous chapters in growth phases . For example a short time ago in 80s it was all about network quality and ratings . Then along comes comes Fox , CW , Cable, plus Syndication competition and programming expands in and choices as all fight to gain ,or hold shares .
Well , here comes the technology for so many more channel devices . However , production ( software) is more expensive while fighting movies domination on the best talent . So, Lifestyle Television emerges and expands . No different when the pressure is own traditional networks to expand themes and reality . Result , very few shows last more than few weeks . At least programmatic is meeting groups with same profile behaviors . Thus the gateway to better targeting ,
rick, I certainly am all for progress and am known as a major critic of what passes for TV programming as well as media planning and buying these days. I also agree that the expansion of channel availability as well as alternative platforms allows for fine tuning in content appeals not possible in the days when the average viewer had only 5-7 channels to pick from. However fine tuning---or "lifestyle" targeting-- has its limits. If as a programmer you cut it too fine, no matter what platform and business model you use, you have to balance the selectivity aspect with content costs and your need for revenue. As a result, broader---though not necessarily "mass", let alone universal----has a huge advantage over tiny but very selective, where making a profit is concerned.
By the way, you stated that few TV shows last more than a few weeks. Where did that come from? A typical primetime broadcast network series that isn't cancelled during its first season---about 30-35% of the shows-----lasts 3-5 years and many are chugging along much longer than that. The same thing applies to a far greater degree for broadcast network/syndication early AM, daytime, news, late night as well as many, many cable programs. Indeed many of these shows--whether we like them or not---are setting new longevity records every year. Now rating fragmentation is another matter, but so far, advertisers are willing to pay enough to support most TV shows, even if they attract fewer viewers per commercial minute on a year to year basis. By combining many shows and program sources linear TV advertisers still get reasonablly high reach levels and digital has not been able to compete in this vital arena very effectively. You can't keep pounding away at small, selective slivers of the consumer population, without your ads becoming redundant, "wearing out" and losing their effectiveness. Hence, the focus remains on broader reach, not just targeting efficiency.