By Parker Herren | February 26, 2024.
AI, data and streaming have created new complexities for TV buyers
The phrase “content is king” is certainly no longer as true as it was in the heyday of “Must See TV.”
As streaming-first TV strategies continue to become central to advertisers’ 2024 marketing plans, the pivot is reshaping how media buyers invest in TV.
Increasingly, there is a shift to separate streaming buys from broader TV ad strategies, resulting in a media buying landscape that looks completely transformed compared to years past. Amid audience data, biddable inventory and automated workflows, the TV shows themselves, once central to ad-buying decisions, seem to be an afterthought in the modern age of TV investment.
This comes also as marketers seek to lean into tech capabilities inherent to digital platforms as a way to cut costs in a marketplace that some buyers told Ad Age is the softest in decades.
Buyers recall the bygone days of broadcast dealmaking, studying new programming from upfront shows and determining what could become the next big hit.
“We used to, on Friday morning, sit with the programming grid and red, yellow and green-light what we wanted to buy so we knew the next week when we were going to market what we wanted on our plans,” said Carrie Drinkwater, chief investment officer for Mediahub Global. “Those days are over.”
Now, buyers are strategizing media plans around a theoretically infinite supply of digital inventory, planning by the equation of what audience is watching on which platform. Automated programmatic platforms now have the job of color-coding where campaigns run. And it all may be upended again when the unknown potentials of AI fully emerge.
Here’s a look at some of the ways TV ad buying is evolving this year.
AI
Each agency holding company has been making investments in artificial intelligence—some to analyze data and others to build client management platforms. But in the realm of media investment, AI is more old hat in the land of programmatic buying and predictive modeling. Emerging uses of the tech, much of which has been focused around image and video generation, or chatbots, haven’t impacted the day-to-day of media buyer life, said Drinkwater. And for jobs that AI might have future implications, such as media planning, the tech isn’t yet sophisticated enough, according to Drinkwater.
“When I think about the day-to-day, the task-oriented stuff, whether it’s billing or traffic—it’s so nuanced in terms of one wrong unit and it could cost you half a million dollars,” said Drinkwater. Instead, she said the immediate impact for agencies is more obvious in the realms of creative and data analytics.
“AI can tell you a lot about the past,” said Drinkwater. “I don’t feel like it can tell you everything you need to know about the future yet.”
Audience is king
The phrase “content is king” is certainly no longer as true as it was in the heyday of “Must See TV.” Now, audience data reigns as TV buying shifts away from linear to streaming and digital platforms, where an advertiser will typically pay a platform-level CPM, or the cost per 1,000 impressions, and match it with data to reach the desired audience.
While some buyers have outlined specific percentages of media dollars spent on audience-based buys, one buyer who spoke with Ad Age on condition of anonymity said in the current marketplace, 100% of client investment is audience-based because it goes through the same workflow, whether that means the buy is hyper-targeted or looks more like the broad demographics of old.
“We’re watching closely on if [the industry] has gone too far” into audience-based buying, said the buyer. “Is every impression created equal so that you just care about the audience? I’m not 100% sure that should go as far as it’s gone, or that it should be so much audience-only without other layers on top of it—audience plus attention plus context.”
To be sure, content still matters—one conundrum of the streaming industry is how to maintain the wave of subscribers who watch individual tentpole shows between premieres. And some streamers are creating more opportunities for brands to align with certain shows: Max has enabled brands to sponsor HBO series for the first time, advertisers have become part of storylines on Peacock and Netflix has generated excitement around co-branded sponsorships for new releases and live events.
But given the vast spread of content across distribution points in streaming, drilling into one show is too much of a limitation for a campaign’s reach.
Geoff Calabrese, North America chief investment officer for Omnicom Media Group, described content as the “carrot that draws people,” but said that “the view of what’s quality may have changed significantly. That’s what YouTube and TikTok are banking on.”
“Distribution points are where the audience comes into play,” Calabrese said.
The definition of TV has become blurry over the past few years, with legacy networks fighting to define content on studio streamers differently than digital video platforms such as YouTube and TikTok. And the fragmentation of content and viewers across distribution points has complicated buying. For example, it may be better to target a certain audience directly with streamers, or sometimes it’s better to do so through CTV companies that disseminate advertising across numerous channels.
Media buyers can then lean on programmatic to solve fragmentation across streaming distribution, joining buys across various platforms by audience data. But TV’s programmatic transition has been equally fragmented.
Automation
As the TV ad market remains soft, media buyers are tapping into more tech capabilities to make marketers’ budgets go further in TV. A primary tool for organizing media strategies is programmatic. While programmatic buying in TV is not a new practice, this year’s emphasis on streaming investment has seemingly raised the emphasis on automated platforms—as well as their limitations in TV.
In TV, programmatic buying is mostly divided down the line between streaming and linear TV. While some companies such as AMC Networks have brought the likeness of biddable inventory to cable, programmatic linear TV functions more for visibility. While broadcast and cable inventory can be bought through programmatic platforms, most network groups don’t allow the same real-time decision making to buy, cancel and shift investments as programmatic allows in digital advertising.
Rather, the visibility into linear buys alongside digital inventory allows a marketer to make decisions faster in the media around a linear campaign.
But while the ability to see a campaign in full is a benefit of programmatic, “the fees associated with activating programmatically often hold clients back because they see from a CPM basis that they are paying more or have less working media on specific buys than they would via a direct [buy with a media company],” said Calabrese. “So, we need to continue to push down on those fees and continue to show how much waste can be removed when working in programmatic environments.”
