By John Egan
In a sign that programmatic ad buying is on the rise, two of the country’s biggest operators of TV stations are stepping up their commitment to this evolving technology.
As Sinclair Broadcast Group prepares to absorb Tribune Media’s TV stations, observers are watching how the bulked-up owner of local stations will affect programmatic buying. Meanwhile, another owner of TV stations, Fox, is diving into the programmatic game.
Earlier this year, Sinclair had floated the idea of creating a programmatic-buying co-op made up of TV station owners. That concept reportedly is on hold as Sinclair concentrates on the Tribune deal.
“Even without the more near-term advertising co-op, TV buying executives say having two big TV station groups working together — Tribune and Sinclair — can give national spot TV advertisers enough U.S. coverage to make large programmatic TV station deals,” according to MediaPost.
Sinclair has 173 local TV stations under its umbrella, and Tribune owns 42. It’s unclear whether Sinclair will be required to sell off any of those stations to gain regulatory approval of the deal.
As Sinclair moves ahead with the Tribune combo, Fox Television Stations Group is jumping into programmatic buying with its 28 local TV stations through a partnership with WideOrbit. Fox says it’s the largest local broadcast group in the U.S. to commit publicly to programmatic ad buying.
The WideOrbit deal enables Fox stations to offer programmatic ad buys under three models:
- An open marketplace to offer programmatic buying with Fox-controlled ad inventory.
- A direct program to automate deals with certain buying partners.
- An integrated system that lets direct response ad buyers place orders programmatically.
“Based on our tests over the last year, we are convinced that programmatic advertising will be a complementary additional sales channel for our stations,” says Jim Burke, president of sales for Fox TV stations. “Opening a programmatic sales channel is a clear win for everyone involved in the media-buying process.”
Sheila Kloefkorn, president and CEO of KEO Marketing, a B2B marketing agency, says programmatic digital advertising allows better targeting of prospects, delivers more relevant ads and leads to higher-quality conversions.
“By automating the digital ad buying and placement process, you remove ad buyers and salespeople. Without humans in the mix, purchasing becomes more reliable and less costly. You can also generate greater insight into consumer behavior and optimize your key performance indicators (KPIs),” Kloefkorn wrote in a post for Forbes.com.
Despite those benefits, programmatic ad buying declined 12 percent in the first quarter of 2017 compared with the first quarter of 2016, according to Digital News Daily.
“For many years, the transition of dollars from direct ad buying to programmatic seemed inevitable, and impossible to roll back,” Todd Krizelman, co-founder and CEO of MediaRadar, told Digital Daily News.
“But the near-constant drumbeat of concern over brand safety and fraud in the first six months of 2017 has slowed the tide. There is more buying of direct advertising, especially sponsored editorial, and programmatically, there is a ‘flight to quality.’ Investment is moving actively into private marketplace programmatic.”
The broadcast industry isn’t the only area being changed by programmatic advertising. At DMA’s &THEN marketing conference Oct. 8-10 in New Orleans, one of the sessions, “Programmatic: The Next Chapter,” will be devoted to the future of programmatic buying. Leaders from Kepler, Coca-Cola, iCrossing and Sirius XM Radio will discuss missed opportunities in today’s programmatic landscape, as well as data implications and internal adaptation. Coca-Cola will share their future-looking approach to programmatic production.
This article is brought to you by &THEN, DMA’s annual event. Click here to join the leaders of the marketing community and explore how data transforms marketing in New Orleans, October 8-10. Save over $300 when you register online.