With more TV buyers snapping up premium digital inventory, more dollars are shifting to digital, which is disrupting traditional ad sales operating models. Last week, Forrester predicted that digital ad sales will overtake TV for the first time in 2016. Convergence isn’t coming — for many, it’s already here.
So, how much longer can programmers afford to keep their digital and linear business in a silo?
Beyond offering a single audience ad buy, cable companies and broadcast networks have more to gain from unification: it’s an opportunity to streamline operations, bundle diverse media types, and ultimately provide buyers with an experience they can’t buy anywhere else.
Selling to a single audience shouldn’t be twice the cost
The demand for digital is growing, but so is the cost. Complex targeting and complicated delivery data reconciliation means that supporting digital sales is five times more expensive than traditional media channels. It takes more people, more touch points, and more technology to execute a digital ad buy. The prohibitive costs of running separate linear and digital operations is forcing change – I have seen networks respond by centralizing operational teams, integrating CRMs, and training their traditional TV sellers on digital ad sales. Unified operations can service multiple revenue streams, providing a more manageable cost structure.
Harness your supply chain – it’s your competitive advantage
Programmers can win by diversifying their product offering, but for many media companies,
especially those with multiple brands and business units, executing this can be daunting. Valuable inventory targeting data is often buried across disparate systems or managed by separate teams. Bundling this into a single offering often requires tremendous change management of people, process, and technology across the organization.
But, conquering the complexity of a fragmented supply channel creates a true competitive advantage. You can offer buyers a unique, integrated, cross-channel experience, which is something buyers can’t get from the major media giants.
Give your buyer’s buyer a one-stop-shop
As the sell-side develops a more competitive, unified ad buying experience, agencies will respond by consolidating their media buying operations, providing a more compelling “one-stop-shop” offering to marketers. Increasingly, marketers will no longer accept dealing with separate agencies for separate buys. Enabling a unified ad buy doesn’t just benefit your customer, it will help your customer be more competitive, too.
The need to combine digital and linear TV is part of a larger industry trend towards consolidation. Over the last year, we’ve seen the signs of convergence — through M&A activity on both the agency side as well as the technology vendors that support linear and digital technology. To stay ahead, media companies need to build their internal roadmap to plan for digital convergence, in which unified operational systems and bundled inventory will be key to future success.