Netherlands Media Day
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1 Netherlands Media Day 27 November 2015 Hilversum Niko Waesche 1
2 When programmatic TV is discussed today we see confusion, fear and uncertainty Questions surrounding programmatic TV Confusion What is programmatic TV really? 2. Fear Programmatic might adversely impact the broadcast business model. 3. Uncertainty How quickly will change happen and are there unknowns in the future? But we also see opportunity. Broadcasters who take the data initiative will not only benefit from new growth opportunities but can improve the audience experience. 2
3 The programmatic industry is largely to blame for the confusion that exists, and these kinds of charts do not help. Source: Lumascape. 3
4 When we speak of programmatic today, we cannot focus on DSP and SSPs alone any more but need to include DMPs Segmentation Other third party data (purchase) Cross media data (TV) Activation Publishers/Media (Premium) DSP (Demand) SSP (Supply) CRM/other systems (booking capacity) In House Agency Systems Real-time campaign results Advertisers Audience Grid/DMP Programmatic/Adtech Consumers 4
5 Programmatic TV does not really exist, we should talk about Addressable TV Differences between Addressable TV and Programmatic Video Addressable TV TV inventory sold in more granular segments. For example, SKY AdSmart (geo-targeting, household composition, advertiser data). TV planning can also be synchronized with digital content and advertising in smart ways. Programmatic Video Facebook, YouTube AVOD/ OTT For example Hulu (with Oracle and LiveRail). 5
6 Many exciting projects today have the objective of combining broadcast TV with digital in smart ways Combining broadcast TV with digital Simulmedia Buying undervalued TV inventory, driving analytics across viewer data and reselling for a higher price. TVSmiles Linking TV advertising to digital and extending advertiser s value. 7TV (ProSieben), Zattoo, Molotov and Magine Running the TV programme on an app. Media planning systems Including richer data in TV planning SW. 6
7 What we will see is that with time is that free TV programs will be embedded in digital apps on all devices, all the time. Free TV will be embedded in digital Digital TV 7
8 We need to take fears seriously that revenues will erode and margins will decline when programmatic takes over. Raisin picking of most attractive viewers CPM of 35 for 100,000 viewers and 5 for the rest (1.9m) = 13,000 for an ad vs. CPM of 20 for 2m viewers = 40,000 for an ad There is a clear awareness that adjacent revenue streams such as media for equity, ecommerce and subscription revenues need to be developed. 8
9 Based on our findings, we are not afraid for the future of the TV industry Nothing creates intent and long term brand effects better than TV Cross-media combinations Many studies show that television and online advertising works hand in hand moving consumers from intentions to purchase Here, a GfK analysis which measured traffic flows across several media and online visits to a major ecommerce site Especially powerful combinations are achieved when branding (TV) and performance (real time bidding and search) are combined. Over 40% of web site visits due to advertising were triggered by this cross media strategy Under 5% of visits by TV, search or real-time bidding each as singular effect of that one media channel alone 63% 37% All visits on site Other Advertising No interaction Interaction TV Other Display Retargeting Search 22% 15% Effect type TV 5% 1% 9% 7% 2% 1% 5% 4% 3% 9
10 Uncertainty, however, remains. The power of TV is uncontested, but this does not mean we can be complacent TV is big, but data is bigger than TV Revenue growth Reduced costs Audience experience Improved ad targeting Churn reduction Content licensing/ creation Locational relevance Content discovery personal -isation Cross selling/ ecommerce Targeted promotions 10
11 However, different types of players are competing for consumer data advantage The battle for consumer data Digital platforms ecommerce giants Subscription entertainment Programmatic/ data collectors Consumer brands with in house DMPs/ DSPs Snapchat Google Facebook Apple Twitter Amazon Zalando Spotify Netflix Radium one Bluekai Axiom Deutsche Telekom P&G Kellogg s Cross-device Profiles Preferences Location 11
12 And the gloves are off Fighting for the data advantage Apple allows ad blockers on ios Amazon removes Chromecast and Apple TV from its shop Facebook publisher ecosystem and Data collectors tapping into ad network location based data Google launches Android TV Apple re-launches Apple TV 12
13 Matching technologies and data are important beyond the media industry John Battelle argues that what is adtech today will evolve into a far more encompassing platform for personalised processing of transactions Walk into a retail store Sit down at a steering wheel Enter a doctor s office Today's example: Seven Eleven savings app for stores Today's example: Via Michelin guide to restaurants and hotels Today's example: MyFitnessPal food logging and exercise tracker Source: John Battelle, "Why the banner AD is heroic, and adtech is our greatest artifact," November 17th See also: K. N. C., "The backlash against big data," The Economist, Apr 20th
14 There is a consumer backlash against the use of personal data Ad blockers and the Customer Commons movement Belgium USA UK Sweden Germany Poland Use of ad blockers (%) Greece 0% 10% 20% 30% 40% 14
15 There are three possible trajectories that transaction platforms could develop into Three trajectories for personalised transaction platforms 1 Customer Commons 2 Data Fortresses 3 The Wild West Source: Creative Commons illustration from an online course of Barbara Buchegger and Christian Nosko. Fortress from Dragoart 15
16 In the end, the consumer will decide where to turn the dial Consumer choice and personal data Maximum convenience Minimum convenience Minimum privacy and security Maximum privacy and security 16
17 17
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