Television & Cinema

Programmatic to Make Gains in Connected TV, OTT Video

US advertisers will spend $14.88 billion on programmatic digital display advertising in 2015, a 47.9% gain from 2014. Investments will rise by 37.6% next year to $20.41 billion—or 63.0% of all US digital display ad spending, eMarketer predicts.

Digital video is the fastest-growing area of programmatic investment—it will grow 204.3% this year—but overall, programmatically traded dollars will account for just 28.0% of all US digital video ad spending in 2015, according to a new eMarketer report, “Digital Display Advertising: Nine Things to Know for 2015.”

In spite of heavy demand for premium programmatic video ad inventory, many of the bigger networks and publishers in possession of such high-quality content and advertising spots continue to eschew participation in programmatic, because they have little incentive to do otherwise.

While eMarketer isn’t optimistic these suppliers will completely change their minds in the next 12 months, it does expect to see connected TV and other over-the-top (OTT) video sources begin to funnel new inventory and advertising opportunities into programmatic.

Though many lump set-top boxes such as Roku, Apple TV or other IPTV-enabling devices such as Google’s Chromecast and Amazon’s Fire TV Stick into the programmatic TV category, they are technically considered sources of digital video given that their content is powered via the internet, though it is ultimately viewed on the larger screen. With significant demand driving programmatic TV forward this year, such a distinction is noteworthy since many believe these addressable set-top boxes the first frontier for its implementation.

Today, advertising options available through these devices are limited in general—let alone in programmatic. But eMarketer anticipates that will begin to change this year. And with the momentum behind the allure of reaching an addressable TV audience, we expect the majority of that inventory will be made available programmatically.

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