Programmatic TV Is a Premium Play

NEW YORK — Programmatic TV “is not a race to the bottom,” Zachary Chapman, ESPN’s vice president of digital and publishing sales, said on a panel at the “Advanced Advertising: Profiting From a Targeted Audience” event here last Wednesday (March 11).

Rather than as a means to squeeze more value from underperforming inventory, panelists at the Multichannel News and B&C-sponsored event said the use of programmatic-style technologies and processes to sell and buy TV advertising should be viewed as a way to drive premium value across a broader scope.

ESPN has been using an automated approach to sell separate inventory — isolated, 30-second spots that appear on-set during SportsCenter, the network’s flagship show. ESPN will only sell that inventory if the bids it receives come in at the right value.

“The idea is to drive the market to a higher price … based on audience and automation,” Chapman said on a panel moderated by B&C business editor Jon Lafayette. The ads sold via that programmatic process have resulted in a “significant premium,” he noted.

Selling TV advertising programmatically is still a nascent concept, but it has already begun to show up in national tentpole television events, including the recent Super Bowl and the Oscars, using systems from WideOrbit and TubeMogul.

While it’s too early to say if those efforts generated a specific lift, it did successfully show that the automated, machine-to-machine process could work for such major TV events, Jes Santoro, senior vice president of enterprise sales at TubeMogul, said.

Advertisers that took part — Mondelēz, for example, bought two local 15-second spots on NBC in Erie, Pa., that ran during the Super Bowl — also extracted some other value out of it: positive PR for being an advertising innovator, Eric Mathewson, founder and CEO of WideOrbit, said.

Programmatic TV also gives advertisers and their agencies the ability to be more nimble and to use their “scatter dollars to be more opportunistic,” Simulmedia vice president of product marketing Ari Osur said.