Programmatic TV 101: What Your Marketing Plan Needs

In the past, TV media buying was carried out over phone calls between advertisers, agencies, and publishers and involved drawn-out manual processes. But with the advent of programmatic TV and the use of automated tools to buy TV ad inventory, media buying has become more efficient. Let’s cover the basics of programmatic TV advertising and how it affects your marketing strategy.

What Is Programmatic TV Advertising?

Programmatic TV advertising is the buying and selling of TV ad inventory through automated systems and software. Through its data insights and algorithms, advertisers can buy and serve ads in real time and at cost-effective prices.

TV inventory is increasingly bought programmatically, just as display inventory once shifted from primarily manual deals to programmatic. But that doesn’t mean buying display programmatically is the same as buying TV programmatically. Rather, TV is a unique channel that comes with formats and business dynamics that require channel-specific expertise.

How Does Programmatic TV Advertising Work?

There are various ways to buy TV ad inventory programmatically. For example, with programmatic guaranteed deals, a publisher reserves impressions for an advertiser, who pays a fixed price for them upfront. With private marketplaces (PMPs), a select group of advertisers compete via auctions to purchase a publisher’s inventory.

And with open auctions, a wide array of advertisers not selected by the publisher bid on the publisher’s inventory, and the buyer willing to pay the highest cost per one thousand impressions (CPM) wins the auction. This all takes place in less than a second.

How Is Programmatic TV Advertising Measured?

Programmatic TV advertising is mainly measured by impressions (the number of times an ad is served to a user), clicks, and desired actions including website visits or purchases.

Buyers can also use key performance indicators (KPIs) tied to business objectives. Common programmatic advertising KPIs include reach, cost per acquisition, return on ad spend (ROAS), and return on investment (ROI).

Should I Be Using Programmatic TV Advertising in My Marketing Strategy?

If you’re prioritizing maximum efficiency, reach, transparency, and measurability, programmatic TV advertising should be part of your marketing strategy.

Programmatic saves TV media buyers time, enables them to target specific audiences, and facilitates more data-driven measurement and optimization.

To make the most of programmatic TV, you need partners who understand the particularities of the channel, which isn’t identical to either traditional TV advertising or other programmatic channels such as display. At FreeWheel, programmatic TV is one of our focuses. Reach out today to learn more about how programmatic TV advertising can drive results for your campaigns.

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