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Wiping a window clean with a squeegee: sell side transparency with the help of programmatic.

Sell Side Performance and How Programmatic Can Clarify Your ROI

December 30th, 2016   ||    by Susan Kuchinskas

Many would argue that advertising has never been more creative. But after weathering a couple rounds of economic downturn, companies have come to demand more than creativity from their agencies and marketing departments. Those on the sell side must prove the return on investment (ROI) of their initiatives.

Chris Kane of Jounce Media, writing for AdExchanger, notes there’s always been tension between the CFO—who is responsible for making sure the company’s money is well spent—and the CMO, who is responsible for creating marketing that will attract attention. Advancements in measurement and attribution have made it possible for both sides to understand when advertising and marketing expenditures are paying off. He writes, “Like any other business investment, marketing is now being held accountable to achieving financial returns.”

This emphasis on ROI has now come to television advertising, which has traditionally been an arena of lavish branding campaigns. A survey of advertisers with million-dollar budgets by Forbes Insights and Simulmedia found that companies are starting to employ digital measurement tools in order to calculate ROI on TV ads. Moreover, seven out of 10 expect to change how they measure the outcomes of their TV campaigns over the next few years, according to MarketingCharts.

Proving Value

There was another data point in the survey that should be a wake-up call to those on the television sell side: Only one in three companies surveyed believed that TV gave them the best ROI in comparison to other advertising types. Worse, 28 percent felt that TV gave them a lower ROI than other channels. The operative word here is “felt.” These marketing executives—and their CFOs—may be basing their media-buying decisions on the wrong premises.

Misconception creates a risk for broadcasters and station groups. If TV ads are “felt” to be ineffective, ad budgets may shift toward other channels. It’s also a risk for ad buyers, because they could miss out on an effective medium and not gain the full benefit of their campaigns.

An increasing amount of evidence shows that TV advertising does work. What the industry needs is more hard data about the effectiveness of television advertising. The sell side is responsible for providing that proof of ROI. Otherwise, when marketing budgets are cut, the unmeasurable channels—including TV—could be dropped.

Data Is Key

The Forbes/Simulmedia study also found that more marketers are placing TV ads that target a specific audience regardless of content, network, or channel. Audience size alone is still an important driver of ad sales, but traditional ratings systems may no longer provide the level of audience insight local outlets need. Those on the sell side have to look outside the box for new measurement tools, which can be problematic for local station groups with limited resources. This is where programmatic platforms like Videa’s can help.

Enter Programmatic

With programmatic TV buying, the sell side can offer advertisers the ability to reach those consumer segments most likely to be receptive to their messages at the household level. Measurement tools that will allow this are constantly improving. Programmatic can offer local television stations plenty of data collected before and after a campaign ends, along with fairer pricing. Media buyers can then use the data to understand the best and most efficient buys, providing them the transparency and ROI measurement they need to satisfy all those demanding CFOs.

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