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Automated guaranteed helps buyers and sellers manage inventory

What Is Automated Guaranteed?

November 18th, 2016   ||    by Melanie Brown   ||    No Comments

The advertising industry is now home to a ubiquitous trend toward programmatic ad-buying technologies. The digital ad space has always been quick to adopt new technological trends and processes, but television has traditionally been a bit slower on the uptake. A practice called “automated guaranteed” has become the latest programmatic development to seep through the invisible divide between digital and television advertising. The practice is currently used by digital publishers as a tool for automating the direct sales process, and now TV broadcasters are jumping into the fray as well.

So What Is It?

Basically, automated guaranteed is a way to reserve inventory on a particular channel for a set period of time. A contract between the advertiser and the publisher lists the ad spend, the amount of inventory, and the cost per thousand (CPM) rate. The advertiser can then use these agreed-upon metrics to programmatically insert ads across the publisher’s inventory based on data and insights from current campaigns.

Programmatic solutions took off among digital advertisers and publishers as a way to make buying and selling online ads through digital ad exchanges much easier. Automated guaranteed then came into play in order to efficiently supplement programmatic ad buys that, while done easily and quickly through real-time bidding (RTB), may not achieve the number of impressions needed to fulfill a campaign.

How Does It Work for TV?

The industry at large can agree that for advertisers, a campaign run only on linear television is no longer enough. More people than ever are watching their content online via their smartphones, Internet browsers, or apps on connected TVs. Since the goal is to expand advertising reach to the outermost edges of a program’s audience, campaigns have to be multi-dimensional.

Programmatic solutions first entered the scene to provide efficient, data-driven campaigns, and now automated guaranteed is being used by TV advertisers as a way to supplement their linear TV campaigns. To make up for the fragmentation of audiences across screens, advertisers are using digital video buys to hit their target gross ratings points (GRPs).

Similar to an upfront buy, the advertiser negotiates a set rate for a set amount of inventory from a publisher or network over the course of six months or a year. The advertiser then has the flexibility to mete out that inventory according data covering the performance of its linear or programmatic TV campaign.

What Should You Look Out for?

There are some points of caution around these buys. Since automated guaranteed is such a new venture for television buyers, the kinks around transparency and pricing are still being worked out. According to Digiday, ad sales and operations are often quite separate, meaning sales’ promises aren’t always easy to keep.

When embarking on an automated guaranteed buy, it’s important to work with the publisher on how the campaign’s prioritization is going to work. Since allocation of the purchased inventory is governed by the advertiser’s existing results, and also by the availability of inventory, getting exactly what a campaign needs may not be as easy as simply dipping into the reserve.

It’s also important to note that pricing is variable. You can negotiate a set rate for a range of inventory, but some of that inventory is going to be more valuable than other parts—it’s in the nature of an ad exchange or unwired network. Be sure to address this with the publisher as well, and make sure your supplemental campaigns are well balanced. This new tool has the potential to expand the transparency and efficiency programmatic has become known for.

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