There is a lot of scuttle talk about the changing TV
landscape from the advancement of TV Programmatic to the demise of dayparts,
upfront and even our current currency. It made for a lively discussion at the
recent AOL Open Series on Programmatic TV. The event featured a panel of media executives
from across the spectrum including Dermot McCormack, President AOL Video and
Studios, Jaime Power, Senior Partner at MODI Media, Dana Hayes Jr, Group Vice President of Global Partner Development for Acxiom and Dan
Aversano, Senior Vice President, Client & Consumer Insights at Turner
Broadcasting. The panel was moderated by Dan Ackerman, SVP, Programmatic TV at
Adap.tv.
Programmatic TV is not what you think according to Ackerman.tv,
who explained, ”Programmatic TV is here to stay. Sixty percent of brands will
apply programmatic techniques to broadcast TV by 2016. But Programmatic TV is not
RTB. It is not the way operates in digital space. It is data aggregation and
accountability.”
I love panels that spark a bit of controversy and this one
provided quite a few dissention points. Ackerman spoke about three areas of linear
television disruption taking place today - in Content, Distribution and Monetization.
The one area that can bring a discussion
to a boiling point is monetization. No one likes to have their planned and
predictable bread and butter disrupted.
While
Aversano believes that the time has come to transition from the current Nielsen
currency, Power is not convinced. She said, “TV is traded on broad demographics.
Now we are trading on consumer behaviors which is something that we could never
do before in TV. But this is just a complement on traditional TV and not a
replacement.” The discussion took off from there:
Power –“Nielsen
is the currency. Until someone comes up with another way to measure television
we stick with the current currency. The foreseeable future is Nielsen currency.”
Aversano – “I
don't know if you need a standardized currency. Some say that is crazy talk but
who are we to say to P&G that they use a certain measurement. We have to be
okay with that.”
Power – “How
do you scale without standards?”
Hayes – “We
have deals today that are leveraging their CRM data, Rentrak, etc. it is a
nightmare but…”
Ackerman – “Are
you set up to trade in a non-currency environment?”
Power – “There
is no way to trade at scale without a unified currency.”
Aversano – “People
do it in digital today. We need a world class revenue management system to bring
supply and demand together.”
Power – “Good
luck to you guys.”
Hayes – “I
have a Switzerland response. You can think about digital people based targeting
for TV but there is too much money and too much risk today in TV. But smarter
agencies and marketers are leveraging now for the future.”
While it is
not easy today for television to shift to a digital model, this shift may occur
in the future as larger and larger percentages of televisions in homes are
connected. So, in my opinion, it is only a matter of time for the entire TV buy
/ sell model transitions to something more akin to what we see in digital… and
even digital may evolve. Ackerman pointed out that even today, “every network group
is developing their own audience and targeting products. They are having real
business impacts and we are seeing shifts of guarantees.”
These shifts in guarantees underscore the real macro trends of supply and demand. Ackerman explained, “The reported TV ad impression growth is misleading. 40% of U.S. households have VOD subscriptions and there are many more programming choices. The impact is fragmentation. The core demo of TV is A18-49. It is the backbone of trade today but it is declining. It is not doom and gloom. It is transition. Adults 18-49 impressions are declining but ad inventory is increasing resulting in slight growth. There are more 15 second spots. So there is less content, more ads, more ad messages. There is an assault on value.”
No one has a lock on how the future will pan out. But if we look objectively at the state of TV we might see that further fragmentation and higher ad loads could spell the eventual end of business-as-usual. In a final stroke, Ackerman asked the panel for one prediction – what will be the biggest headline in the 2017-18 upfront? The answers - McCormack predicted, “Upfronts are dead.” Power said, “I disagree (that upfronts will be dead). Data will be more actionable. More driven.” Hayes believes, “Programmers that do better TV measurement will win.” And with the last word, Aversano predicted, “Day parts are dead. There will be new ways to structure inventory, driven by data and analytics.”
These shifts in guarantees underscore the real macro trends of supply and demand. Ackerman explained, “The reported TV ad impression growth is misleading. 40% of U.S. households have VOD subscriptions and there are many more programming choices. The impact is fragmentation. The core demo of TV is A18-49. It is the backbone of trade today but it is declining. It is not doom and gloom. It is transition. Adults 18-49 impressions are declining but ad inventory is increasing resulting in slight growth. There are more 15 second spots. So there is less content, more ads, more ad messages. There is an assault on value.”
No one has a lock on how the future will pan out. But if we look objectively at the state of TV we might see that further fragmentation and higher ad loads could spell the eventual end of business-as-usual. In a final stroke, Ackerman asked the panel for one prediction – what will be the biggest headline in the 2017-18 upfront? The answers - McCormack predicted, “Upfronts are dead.” Power said, “I disagree (that upfronts will be dead). Data will be more actionable. More driven.” Hayes believes, “Programmers that do better TV measurement will win.” And with the last word, Aversano predicted, “Day parts are dead. There will be new ways to structure inventory, driven by data and analytics.”
It will be
interesting to see who is right next year at this time.
This article first appeared in www.MediaBizBloggers.com
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