2016 was an exciting year for programmatic TV. The space is quickly maturing and money continues to flow in the television industry from the investment community. What originally was a buzz word has now turned into $21.9 billion industry according research firm, BIA/Kelsey.
Programmatic TV is an especially interesting topic for speculation because this technology is rapidly evolving as we know it. 2017 stands to be a pivotal year for programmatic TV with predictions such as eMarketer’s projecting that programmatic spending will increase by 127.8 percent to $710 million. Additionally, IPG Mediabrands Magna Global, forecasts that programmatic is expected to represent 17 percent and $10 billion of TV budgets by 2019, up from 4 percent and $2.5 of U.S. TV budgets in 2015.
We believe that the industry can expect to see some more accelerated adoption of programmatic TV in 2017. Here are some additional predictions for programmatic TV, that the industry can expect to see in the New Year.
Addressability will evolve.
Addressability will continue to grow and the cable industry will benefit from it more than the broadcast sector. All of the MVPD’s including Cox will continue to aggressively invest in addressable TV so that 1:1 marketing can be achieved at a household level. Broadcasters will also maintain partnerships with Smart TV providers so they can offer their own addressable solutions. Additionally, broadcasters will continue to invest toward ATSC 3.0. One recent example of how addressability is evolving and growing is the AT&T / Time Warner deal. In September, AT&T announced that the company would purchase Time Warner. In short, the industry went from one behemoth to two.
There will be new metric techniques available to measure and value audiences.
Traditional measurement companies including Nielsen and comScore will have more spending, behavioral and psychographic data. Additionally, while there will be new metric techniques available in 2017 to measure and value audiences, traditional types of data providers such as Nielsen will not disappear, but will rather be enhanced and improved.
The OTT market will develop and progress.
In 2017, the OTT market will evolve and as a result, there will be a rising number of people watching ads non-linearly through an OTT app or service such as Hulu rather than not linearly through the primary feed. In other words, this means that the viewing of TV and video content in non-traditional ways will continue to accelerate.
There will be an increase in local business that will be transacted on CPM.
Common goals for programmatic sales will change and evolve as scaled inventory is available and publishers and marketers begin to agree on new guidelines of engagement for this sales channel. This could include different guidelines around pre-emptions, payment terms as well as posting rates. Also, there will be an increase in local business that will be transacted on CPM. This will simplify some of the problems on rules and delivery.
The industry predictions and trends above are ones that we expect will be some of the leading themes in both the programmatic TV and television narratives in the coming year. With the future of programmatic TV looking to be a bright one, what trends do you think we will likely see in the television industry in 2017 and beyond as advertisers look to make their campaigns as effective as possible?
As evidenced at the Progress Connect Conference in Boston, programmatic continues to be the focus as everyone tries to understand what 2017 will bring.