By David Benady, Special to Advertising Week Europe
European TV stations band together to create programmatic alliances. But can automated ad buying ever replace gut feeling?
Programmatic online video is expected to become a €2bn industry in Europe by 2020.
Persuading broadcasters and publishers to pool their inventory to strengthen their position in the online advertising market has been a major achievement in Spain and France. The move has boosted their market power against global giant YouTube. But creating such an alliance is not something broadcast regulators would allow in the UK.
SpotX brought together ITV, France’s La Place Media and Atresmedia from Spain to discuss the implications of programmatic video alliances and also debate the relative merits of online video advertising versus TV ads in a workshop titled “The €2bn Video Advertising Imperative,” led by SpotX managing director for the UK and southern Europe, Leon Siotis.
Beatriz Medina Layuno, digital sales director of Atresmedia, one of Spain’s main commercial broadcasters, described the creation of programmatic alliance Aunia, a programmatic private video marketplace that unites selected inventory from Atresmedia and rival Mediaset. She said it was hard to persuade the bosses at Atresmedia to form an alliance with their main rival.
“In broadcast, digital is a tiny proportion. When we came up with idea of a movement with main competitor, everybody said ‘why do this?’ They hate each other and they were scared of regulators. The point that convinced them was that this expands our power against the agencies. We needed to be strong on supply side,” she said.
Meanwhile, Arthur Millet, managing director of La Place Media, described how this co-operative programmatic venture came about. “Five of the biggest media players in France banded together to create a joint venture, La Place Media, to grow their programmatic revenues through a data-sharing arrangement. If we bring all inventory to one point we can have more pressure and higher value,” he said.
ITV’s group commercial director Simon Daglish said it would be unlikely for UK regulators to allow a programmatic alliance between TV stations. He announced that ITV had started working with SpotX, though played down the likelihood of programmatic becoming a major part of ITV’s TV ad sales. He also took the opportunity to give a stout defense of TV advertising, which he thought could not be replaced by online programmatic.
“Regardless of what you hear, the big moments still exist in TV,” he said, pointing out that 11.1 million people had watched ITV’s “Britain’s Got Talent” last weekend. He described how department store chain John Lewis launched its hit 2013 Christmas campaign “The Bear and The Hare” during ITV’s hugely successful show “The X Factor.”
“The John Lewis viewer is a C4 viewer, not an ITV viewer. But John Lewis chose to launch that ad in the middle of ‘The X Factor’ because of the reach and the cultural phenomenon it could create by having that big bang moment.” He said this was not about taking a targeted approach to finding the right audiences – the offer of programmatic online advertising – but was about understanding human nature and how people react.
He said he worried about programmatic advertising, which uses data to slice up audiences and addresses ads to ever smaller and more specific segments.
“What TV does so well in the UK is to hit a mass audience very quickly and builds your brand, which no other medium can do. If you start cutting that up into a thousand different segments, you lose that innate ability and that would be a shame,” he said.
However, Millet pointed out that programmatic is not just about slicing up audiences, it also automates the whole online ad buying process.
“The question is time – advertisers want to gain time. When we say everything will be programmatic, it is automation,” he said. And he added, “You need, when you launch a brand, a big share of voice, but you still need to target the right population. If you have tomorrow the tools to have both at the same time, launching a product and having this big share of voice and can reach all the population you want to reach at scale, you are going for the market.”
Many people predict that all TV advertising will eventually be sold programmatically. But it remains to be seen whether mass-market broadcasters such as ITV will ever do away with their sales teams and replace them with automated systems. More likely, programmatic will expand the arsenal sales teams have at their disposal.