In the world of direct response, most marketers are familiar with programmatic TV — the use of software-based systems to plan, buy, measure and optimize television advertising. However, a sub-set of programmatic TV, known as addressable TV, is offering another alternative and an effective way to target audiences.
While programmatic TV can reach a more granular audience with a lower overall cost, addressable TV determines the audience composition in real-time and then chooses the most appropriate ads. This difference gives advertisers the ability to target audiences by calling upon first-party data. This allows ads to be delivered to viewers or households within the target audience with precision. Addressable TV segments audiences based on their geographic, demographic or behavioral characteristics. And, even more exciting in this multi-screen world, is that it is purchased on a cross-screen basis to help boost purchase intent, wherever the target consumer is consuming content.
Because of these immense benefits, the future of addressable TV is bright. Programmatic TV spending (which includes addressable TV) climbed 127.8% in 2016 to $710 million.
By 2018, programmatic TV will account for 6% of TV ad spending, according to eMarketer. Further, IDC Expects that programmatic TV ad spend will be around $17.3 billion worldwide by 2019.
In the US, overall TV market size is currently about $70 billion, with Magna Global estimating $10 billion for programmatic TV in 2019.
At Diray, we know the most effective marketing delivery channels are powered by real-time targeting and measurement. As a longtime expert in TV advertising, our team has included addressable TV as a bridge between online and TV advertising for our clients. The data we uncover from addressable TV campaigns enables us to model household data to further improve reach for our clients on traditional linear TV buys.
In this way, Diray targets the most effective and scalable demographics across channels to achieve a successful omnichannel approach. These campaigns provide an opportunity for digital display campaigns, linear TV campaigns, and programmatic TV campaigns to align and inform each other.
With technology advancing at such a rapid pace, it’s time for direct response marketers to include addressable television as part of an integrated media mix. If you’re looking to utilize programmatic and addressable TV, contact Diray today.
During our 30th anniversary year, Diray will feature blogs that look at where we have been, where we are, and where we think the industry is going.