Ad Spending On Local Video To Expand $5B By 2021

A new ad forecast from BIA/Kelsey “Programmatic is Coming to Local TV in 2017,” predicts that spending on local video to target local audiences will grow by $5 billion: from $32.6 billion in 2016, to $37.6 billion by 2021.

The report said a large portion of the digital video and local TV growth will come from programmatic spending. This will occur as programmatic becomes more of a factor in broadcast and MVPD (multichannel video programming distributor) video platforms, with a portion of the video spend directed to linear video platforms.

“Our latest research reveals the landscape of programmatic players is growing more complex, as companies offer more cross-platform and cross-functional solutions,” stated Rick Ducey, managing director, BIA/Kelsey. He said the developments are supported by new alliances and partnerships.

“When you step back and examine the possibilities, any movement of local TV toward programmatic buying and selling will significantly impact the amount of spending and could win more spending that might have gone to digital,” he stated.

The research assesses the local programmatic TV space at the start of 2017 and analyzes five key factors that need to be addressed:

Data-driven audience targeting: Marketers and agencies are demanding more than simply gender/age audience measurement at the local level. The current mix of data at the household level is a start, but the market wants more.

Household-level targeting: At the local level, there’s no system offering targeting to households. Programmatic trading is always at the DMA level. Addressability or advanced TV buying is offered by MVPDs but it's not yet connected to programmatic. Cable buys may be based on the DMA, but can only deliver the subscribed homes’ footprint within these DMAs.

Data quality and transparency: Varying data quality, data modeling, governance, architectures, integration, and quality assurance issues are concerns. Duplication of panel data across providers licensing the same data creates challenges. Two big issues are the cost and quality of data.

Workflow integration: Advanced integrations across different workflow software among and within buyer and seller communities is necessary.

ATSC 3.0: Looking ahead, ATSC 3.0, the new standard for local broadcast TV, will offer new data capabilities for targeting audiences. The next step is how to plan for it. This technology supports personalized content delivery including programs and ads, but relies on a larger ecosystem -- including an installed base of media gateways, connected TVs and mobile devices with ATSC (Advanced Television Systems Committee) tuners.

Next story loading loading..