The power of reaching consumers via the largest screen in the house is already well established. What marketers now need to know, in order to truly take advantage of ad-driven CTV, is how to achieve cost-effective scale.

Currently, most CTV ad slots are purchased in a similar fashion to traditional linear TV – via direct insertion order (IO). This ‘white glove service’ has proved effective for many years, and relies upon marketers contacting broadcasters and platforms directly, and agreeing the predetermined details of a campaign – such as cost, run-time, creative – in advance.

However, as CTV has grown, so has the need for a purchasing method that grants marketers the ability to achieve optimal ROI on CTV. Programmatic purchasing has evolved alongside CTV and now meets this need to provide marketers with a buying experience similar to that of digital, to more effectively maximise the potential of their ad budgets.

The evolution of programmatic CTV

In its early usage, the auction-based programmatic purchasing method was mostly utilised in order to sell unused ad inventory in digital environments. But as CTV publishers and platforms continue to permeate audiences, and buyers take to the increased control of the purchasing process that programmatic enables, the amount of spend in programmatic CTV has grown – spend increased by 97% in EMEA between 2020 and 2021 alone. As demand from buyers has increased, CTV publishers have responded by making more of their inventory available for programmatic trading.

Where programmatic CTV has differed from its digital counterpart is in its increased use of private marketplace deals. At its core, programmatic buying is an automated auction that allows buyers and sellers to be connected rapidly. Deals can be achieved via an open auction, where any number of parties can take part in the process, or via private auctions, where a publisher invites trusted advertising partners to participate. Additionally, there are preferred and guaranteed deals, offering priority access and pricing on pre-negotiated terms.

Private market auctions have flourished in CTV due to the nuances of the channel. TV ads are the most trusted among UK consumers, and it is therefore no surprise that CTV publishers want to keep a close watch on which brands are advertising on their platforms to ensure high quality ad experiences. For marketers, CTV is also unique in that data activation is often coming from the supply side of the programmatic chain, enabling marketers to access the rich first-party data of media owners and device manufacturers.

Tailoring your buying

While increasing amounts of spend is moving to programmatic, direct purchasing via an IO  also allows an effective way to transact for both buyers and sellers, and in many ways provides a similar offering. Buyers are guaranteed a quality ad slot while having clarity over delivery, while also able to harness CTV publishers’ premium inventory for a set price.

However, for buyers and sellers looking for flexibility in their transactions, programmatic purchasing can offer some additional perks. Guaranteed programmatic deals, for example, act in a similar way to direct IO — selling for a fixed price with a specific amount of inventory. But, additionally, doing so programmatically enables buyers to retain the benefits of utilising a DSP, giving users increased control — easing workflow and allowing for optimisation mid-flight — and  more holistic reporting.

But, while programmatic purchasing may technically be able to offer these benefits, advertisers might currently find their programmatic choices restricted by publisher capabilities and offerings. Buyside appetite for programmatic executions shows no signs of slowing, so ultimately CTV publishers and broadcasters who are amenable to programmatic routes stand to benefit.

Taking buying to the next level

Programmatic ad buying in digital environments is at a crossroads. With third-party identifiers set to be phased out, there is an increasing importance being placed on first party data — and as a result, on the owners of this data, such as publishers and device manufacturers — to ensure effective targeting and measurement.

Traditional measures such as Barb have provided advertisers with a base level of insights in order to effectively run campaigns. However, the emergence of technology like automated content recognition (ACR) – a privacy-first, anonymised alternative content identification technology – and first party data from platforms and device manufacturers gives buyers more granular insights to drive their campaigns at scale and speed.

These insights can then be fed back into a marketer’s buying strategy, allowing for fine-tuning of campaigns in-flight. Furthermore, utilising programmatic CTV can turn the medium into the cornerstone of an omnichannel campaign. This approach – which gives marketers the ability to run a cohesive, holistic campaign across multiple devices – allows for optimal targeting and retargeting throughout the sales funnel. By identifying and retargeting exposed audiences across devices, with differing creative, marketers can better tell the story of their campaign and grab consumer attention.

For marketers looking to generate the best ROI, and gain maximum reach and impressions via CTV in a cost effective way, finding a balance between direct and programmatic deals is vital. While there are currently similarities in both purchasing methods, as publishers compete for ad spend investments, the additional flexibility of programmatic and offer of tailored purchasing options will become a differentiator. In turn, the greater autonomy, transparency, measurement, and targeting capabilities will become central to every campaign on the channel, and buyers will increasingly be looking towards programmatic CTV.

The companies say the partnership is designed to “unlock new insights and allow for seamless activation against high-performing audiences within a clean room environment” which will be powered by M1, Carat agency’s proprietary data and identity platform.

NBCUnified launched in January of this year, and is intended to be a fully interoperable platform, enabling marketers to connects data spines –from agencies, third-party technology platforms, industry-wide initiatives, consortiums – in privacy-secure way.

Heather Stewart, General Director, Global Media and Marketing Services, GM, said: “At GM we seek to deliver world-class customer experiences at every touchpoint and to do so on a foundation of trust and transparency. As marketers, that means responsibly engaging with audiences in ways that make sense and can add value to their lives. Leaning into more sophisticated addressable media opportunities, like the one we’re announcing here with NBCU and Carat, gives us a leading-edge in connecting with consumers today.”

John Lee, Chief Data Officer, NBCUniversal, commented: “The future of media is built on a foundation of first-party data, and our unique, three-way partnership with General Motors and Carat’s M1 platform is an important first step into that future.

With this integration, GM will be the first brand to come to market combining the power and depth of their first-party automotive data with that of NBCU’s first-party data on consumer media consumption that comprises over 200 million consumers and 80 million households, creating more powerful insights and higher performing target audiences for activation.”

The initiative will enable advertisers to match their first-party IDs to some of the most commonly used IDs in the TV advertising ecosystem, supporting ID solutions from companies such as Merkle, OpenAP, Blockgraph, Experian, LiveRamp, and TransUnion. The initiative will also support device identifiers such as cookies, mobile IDs and CTV IDs.

FreeWheel argues that privacy regulations and future cookie deprecations are causing companies to rely on first-part data solutions, often built on proprietary identifiers. As a result, the identity landscape has become highly fragmented. FreeWheel believes that creating interoperability between publisher, operator and carrier data will ‘de-fragment’ the industry.

Mark McKee, General Manager, FreeWheel, said: “We are doing this to simplify workflows and create scale by driving interoperability across many of today’s leading ID solutions. The industry is growing more complex – from data points to endpoints, and everything in between. As an ecosystem connector, we hope to make the premium video space more seamless, efficient, and ultimately, more effective for both media buyers and sellers alike.”

Jon Whitticom, Chief Product Officer, FreeWheel, commented: “FreeWheel creates interoperability across various industry ID solutions, as well as traditional device IDs, utilizing advanced privacy methodologies and minimizing data leakage.

“This enables a buyer or seller to build a segment in nearly any ID space and execute using FreeWheel technology to provide the connective tissue across the television industry enabling them to better reach their audience accurately, and at scale.”