Streaming is still in its adolescent stage in terms of business, and puberty frequently brings undesirable change.

From the rise of programmatic TV ad buying to the release of new ad inventory on Netflix, Disney+, and Prime Video, buying TV commercials has never been more hard, according to Eric Schmitt, a research director and analyst at Gartner.

As purchase paths expand, targeting becomes more ambiguous, and TV ad measurement remains a mystery.

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“There’s still a long way to go,” Schmitt adds, before the streaming ecosystem can realize the full promise of connected TV by attracting more ad dollars. To help with this process, he adds that some TV marketers are changing their approach to programmatic platforms, employing them for campaign management rather than just buying.
I met with Schmitt to pick his brain about CTV’s main pain areas and how marketers may reduce their TV-buying headaches.

ERIC SCHMITT: Buyers enjoy using demand-side platforms because they provide access to numerous pools of inventory, targeting, and reduced prices. However, buyers are having to make sense of the diverse audience strategies and reporting from several DSPs.

Signal loss exacerbates the problem significantly. Browser cookies have traditionally acted as a durable identification across ad channels, and TV buyers would utilize them to correlate ad exposures to online behavior. However, that skill is deteriorating, and there is a lot of probabilistic nonsense out there that isn’t coming true.

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Poor targeting is particularly noticeable for regional and hyperlocal advertisers attempting to reach consumers in a specific area. I frequently see advertising for tiny retailers that are not near me, which are wasted impressions.

What can TV advertisers do to make their life a little easier?

This is where marketers must be really attentive. Because programmatic sales have a high profit margin, agencies are highly motivated to drive additional purchases through DSPs. However, the targeting has deteriorated, so advertisers should still contact publishers directly.

Advertisers, for example, can purchase ads directly from publisher partners and then manage their campaigns using their favorite DSP.

More TV advertisers are using DSPs as a campaign tracking tool rather than for planning and buying, particularly those who prioritize location-based advertising over hyper-targeted ones.

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What about digital-native firms that wish to use streaming as a performance marketing channel?

Competent performance marketers are beginning to embrace streaming, even utilizing it to compare incrementality to the rest of their purchases. Their dollars are helping to mature the market.

At the same time, there is a significant distinction between CTV and over-the-top (OTT).

Because OTT includes devices other than television sets, such as phones and PCs, there is more signal and attribution, which will appeal to direct response advertisers. People still seldom interrupt their TV viewing sessions to go shopping, but when they do, it’s much more likely to happen on a mobile device rather than a TV screen.

What streaming trends will be dominant for the rest of the year?

The digital-native platforms are gaining dominance of connected TV, and it’s not only the newcomers to ad-supported streaming, such as Netflix and Prime Video. YouTube’s grip on the CTV market is becoming increasingly tight.

TV networks and internet platforms will continue to compete for streaming advertising dollars by attempting to differentiate themselves. Streamers are currently grappling with a particularly pressing issue: ad load.