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Why Automated Guaranteed TV Buying Does Not Equal Programmatic

September 12th, 2017   ||    by John R. Osborn   ||    No Comments

Like any labels for new business processes, the terms “programmatic” and “automated guaranteed” can raise feelings of uncertainty—and even apprehension. But knowledge is often the best form of empowerment. This is very true when it comes to local TV buying, where automated TV buying technologies are already streamlining and improving the work of both buyers and sellers.

Digiday defines programmatic ad buying as the use of software to purchase digital advertising, as opposed to traditional processes like requests for proposals (RFPs), human negotiations, and manual insertion orders. The Interactive Advertising Bureau (IAB), however, notes that “‘programmatic’ has become ambiguous shorthand for some or all of a diverse range of platforms, tools, and processes in digital advertising.” In other words, a universal definition of programmatic has yet to really emerge.

What’s What, Exactly?

Automated TV does not equal programmatic TV since within the term “programmatic” there are several methods that began with online display advertising and expanded into audio, video, out-of-home advertising (OOH)—and now TV.

The IAB details four types of programmatic and automation:

  1. Automated Guaranteed: Based on fixed pricing and reserved inventory.
  2. Unreserved Fixed Rate: Based on fixed pricing and unreserved inventory.
  3. Invitation-Only Auction: Based on auction-based pricing and unreserved inventory for certain buyers.
  4. Open Auction: Based on auction-based pricing and unreserved inventory for anyone to buy.

Of these, automated guaranteed is widely viewed as the future solution for the local TV sector—the type of programmatic TV buying most likely to take hold and grow over the next five years.

Besides making the transaction of local TV buys more efficient, all programmatic brings the ability to incorporate much more highly targeted audience data than traditional program ratings. Programmatic can reach a specific TV household—or even a person in that household—rather than relying on the traditional age/gender or viewed/didn’t-view measurements to deliver value to advertisers.

Imagine Ralston Purina being able to target only homes with dogs. Automated TV buying today is thus laying the pipes and opening the doors to transactions with greater audience addressability, which is surely exciting news for buyers and sellers alike.

Don’t Take It Personally

But let’s go back to the potential uncertainty and apprehension over what programmatic and automated TV might mean for advertisers on a personal level. The trick is to keep two things in mind. First, no one knows the future, and change usually comes in an evolutionary (rather than revolutionary), fashion. No one discards a profitable business model for a new one without adapting and testing its viability first. So there’s time and room to grow with these changes. Second, there will be many new opportunities for those willing to learn and expand within that evolution.

So settle in and embrace the future—not with worry, but with plenty of curiosity and expansiveness instead.

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