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Combat Connected TV Advertising Wastage Now!

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The rising popularity of advertising on connected TV (CTV) is, arguably, the hottest topic in our industry today.

According to Insider Intelligence, U.S. advertisers spent $14.44 billion on CTV in 2021, an increase of 59.9% over 2020. Programmatic trading of this inventory is a key contributor to its growth and is well on route to becoming the default infrastructure for CTV advertising.

 The size of the prize is huge. CTV programmatic expenditure in the United States is predicted to reach $8.67 billion in 2022, up from $6.73 billion in 2021 and a “mere” $4.36 billion in 2020. However, there is a big black hole forming at the center of this new CTV programmatic galaxy, and as the expenditure grows so does the hole.

The hole is wastage. In other words, the amount of advertising inventory that goes unfulfilled due to avoidable reasons such as technical faults, ineffective targeting, and underperforming campaign outcomes. By our estimates, the current size of this void is about 15% of the total CTV programmatic inventory today. That translates into $1.3 billion of lost revenue in 2022 in the U.S. alone. 

Here are my top 3 reasons and recommendations for working to combat CTV programmatic waste.

1. See the Forest of Insights from the Trees of Data

If the digital revolution has given us anything, it is data: the ability to reconstruct the history of the virtual world in a way that we can “relive” it in near full fidelity. Data now emits in the digital universe like light does in the physical one.

Streaming providers, ad operators, traders, planners, producers, developers, and everyone in between can now understand exactly what has happened and what IS happening at any point across their viewership graph in almost infinite detail. With this all-seeing ability streaming businesses large and small can “know and grow their future” by fully understanding their past.

Operators need to recombine their Audience, Revenue, and Content (ARC) data into their holistic, symbolic, and operational wholes (ads, ad breaks, viewing sessions, etc) to be able to look across every viewing experience they deliver and learn what is working and what is not.

This is a devilishly hard problem to solve, but the prize of greater, and sustained, growth from programmatic via understanding how it actually works is more than worth taking on the challenge. 

2. When It Comes to Monitoring and Optimizing CTV Ad Yield, the Tail Is Wagging the Dog

Perspective is everything, and right now rev ops teams at streaming media platforms are looking at their world backwards, from the inside out. 

Data is currently collected as fragmented and disparate sets supplied by the system vendors, of which there are many in a programmatic chain.  Akin to trying to glue a shattered teapot back together, the end result is often malformed, missing many pieces and is far from functional. 

Consider the following scenario: An ad ops team at a streaming service spots hints from their ad server analytics that their fill rate is decreasing, so they make contact with their ad server vendor. They’re told everything’s in order so next, they raise their concerns with their dynamic ad insertion (DAI) provider, who tells them that they’ll look into it but from their point of view, everything seems to be working, now on to the SSP, and so on.

Although at the system level all components check out, the holistic view can’t be achieved, and therefore no one, yet everyone, is at fault. 

In the end, the streaming provider runs around in circles over days and weeks getting nowhere, all the while valuable programmatic revenue is lost.

It is certainly not easy to reposition your vantage point to one that evaluates your ad tech and programmatic trading from the outside looking in, but it is essential in order to improve troubleshooting and decision-making (especially where pricing is concerned) to realize the full value of your inventory.

3: Standards? What Standards? 

The CTV landscape is fast expanding and early adopters are rushing in, staking their claims and circling their wagons. In this new world, there is a real lack of standardization. After all, standards can be the antithesis of competitiveness. But they are bridges that provide interoperability and allow markets and industries to scale well past the sum of their parts.

Programmatic CTV is no exception. Borrowing much from programmatic trading on the open web, it noticeably lacks the common technologies, languages, and standards that have been born and perfected there. There are cursory nods to some trading standards like VAST and VPAID but in the "non-web"world of Programmatic CTV that is not much better than lip service. 

Media owners entering this arena need to come armed with the understanding that you will need to distribute and participate in a very fragmented market, all the while not being able to rely on a common set of standards.  

Google, Apple, and Roku all have their own proprietary coding and playout platforms (not to mention ad policies). Server-Side Ad Insertion technology is highly proprietary and unique; each defining an impression as they will. Even the primary ad servers offer different levels of support for the more prevalent standards like VMAP and VAST.

As CTV grows in popularity and programmatic becomes the primary source of ad revenue, problems around measurement and monitoring are only going to become more painful and expensive if action is taken early and robustly.

[Editor's note: This is a contributed article from Watching That. Streaming Media accepts vendor bylines based solely on their value to our advertisers.]

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