Digital Radio Goes Programmatic

It comes as no surprise to see digital radio (audio) numbers escalating. Nevertheless, all the bells and whistles to follow bring forth some interest.

eMarketer estimates that by 2017, “Digital Radio listenership will grow to 57.8% of the population”. Mutually, ad dollars being spent in the digital audio sector will also grow. However, those ad dollars might be spent in a slightly different way than usual.

The International Data Corporation (IDC) expects for one in five radio dollars (approximately $4 billion) to be booked programmatically by the year 2020. As defined by Prohaska Consulting programmatic buying is, “the process of executing media buys in an automated fashion through digital platforms such as exchanges, trading decks, and demand-side platforms (DSPs). This is an alternative to the traditional use of manual RFPs, negotiations and insertion orders to purchase digital and other platforms.”

So, why is digital making this switch into the programmatic world? Well, simply put, it’s easier and more detailed.

Easier – no longer do buyers have to ask for a proposal, negotiate for the best price, and send in an insertion order in order to make a buy. Now, buyers’ impressions (radio spots) are purchased automatically through a bidding format.

More detailed – Programmatic allows for layers upon layers of targeting with the use of app-login data, first-party registration data, and other third-party data.

So instead of just targeting a person who probably listens to alternative music during the hours of 6am – 8am, advertisers can now target that 28 year old male who loves alternative, drives to work between 6am – 8am and has also been eagerly searching for the perfect diamond ring, wedding venues, houses on the market, and all-inclusive resorts. That extra piece of information opens tons of doors to advertisers to specifically target the soon to be married male in contrast to a 28 year old male who loves alternative and lives in his parent’s basement. 

Unexpected DVR Trends

I remember when my family first got a DVR; I was a young teenager with two very frugal parents. However, when the cable company offered a free trial, my dad bit the lure and after a few months we were hooked.

Even as a kid, I remember hearing the buzz about how DVR would ruin the television industry and take away from the advertisers. Surprisingly enough, data from Nielsen and the Video Advertising Bureau report a different story.

During the first quarter of 2016, time-shifted programming (recording television and watching it at something other than the original air time) has dropped 12% among viewers 18 and older.

For years, estimates had been that viewership would be roughly 50/50 between time-shifted programming and live programming. However, data from first quarter 2016 shows that 77% of viewing is done live while only 23% comes from DVR viewing.

Other demographics have seen a decline in DVR viewing as well. Those aged 50-64 have dropped 6% while people 65+ have declined 7%.

So, why aren’t people watching as much prerecorded television shows as they used to? After all, it does give you the power to fast-forward through all those commercials. Perhaps the industry is simply shifting. One theory is that the rise of digital media is to blame.

In my mind, this is great for advertisers. Most digital streaming video has opportunity for advertisements without the ability to fast-forward.

Fear not! Viewers are still watching television and they’re still watching their DVRs. Advertisers can still reach their audience during shows; it just might be through their laptop or smartphone screen rather than on “the tube”. 

Managing Makegoods and Broadcast Buys This Political Season

What’s worse than seeing political ads nonstop? If your answer is something other than, “having your ads pre-empted due to political ads nonstop” then it’s almost guaranteed that you don’t work in the media industry.

Borrell Associates Inc. has estimated that during the 2016 election season 5.8 billion dollars will be spent on broadcast television. And yes, you did read that right, that’s billion with a “b”. To top that, broadcast television advertising makes up roughly half of the total advertising spend for political this year.

So how do we prevent these pre-empt spots? Evan Brown points out some strategies in his article, “Working Around the 2016 Political Advertising Season”. Here are a few:

1.      Buy early! Typically stations use a “last-in-first-out” method, so the sooner, the better on those broadcast buys.

2.      Avoid buying five spots per week for a standard program like morning or late news. This gives the station absolutely no flexibility in your placements.

3.      See if 15 or 10 second spots are less likely to get bumped. Political ads are commonly 30 seconds in length.

4.      Accept the fact that the spot you paid $100 for last buy will now be double and adjust accordingly.

5.      Keep on top of your makegoods. Despite receiving them all day, every day, it’s important to respond rapidly to have the best chance to re-placed spots.

Hopefully these tactics can be of assistance in reducing the amount of makegoods into a more manageable task. As The Little Engine that Could would say, “I think I can, I think I can”, so stand strong broadcast television media buyers, there is light at the end of the tunnel!

Native Advertising: Accepted by Millennials but Questioned by Baby Boomers

You might be asking yourself, “native advertising, what’s that?” no worries, 42% of the adult population is clueless, too. Native advertising is defined by YouGov as, “the practice of placing videos or articles on a website that appear similar to the site’s regular content, but are actually paid ads that promote a product or company.” Remember the last time you were on a news related website and saw a couple stories with a label such as “sponsored” or “advertisement” next to it? Well, that is native advertising.

According to YouGov, millennials are the most welcoming when it comes to these advertised articles whereas older generations are worried about this paid content.

However, when users risk losing free access to website content, the older generations are more accepting of the ads.

Regardless of the immediate perception, native ads don’t seem to be going away any time soon. In fact, BI Intelligence estimates that by 2018, $21 billion will be spent on this form of advertising alone.