Complying with the California Consumer Privacy Act (CCPA), should be top of mind for every company in the ecosystem. The regulations that support CCPA have only been released for public comment, so it's going to be a big challenge to develop your compliance plan while the law is still being fully fleshed out.
The next battleground for both independent and “owned and operated” DSPs is the convergence of TV and digital media. This dramatic transition is well documented in Forrester’s recent “New Wave” report on cross-channel video platforms. Our very definitions of what “programmatic” and “DSP” mean has to change for the world of video. Many of the assumptions which underpinned the first generation of programmatic advertising—namely an infinite supply of display media best sold through real-time auctions leveraging widely available user/device-level tracking—no longer hold true in the television-converged media landscape. TV is supply-constrained, its inventory is bought and sold primarily through annual upfronts, and measurement comes from audience panels like Nielsen (versus individual devices). In order to compete, DSPs must acquire or build the next generation of ad technology, a very costly and time-consuming process that will further accelerate consolidation and raise the barriers for new entrants.
Bringing privacy-compliant solutions to market and delivering on the promise of brand impact while protecting the consumer will be a top challenge in 2020. We are actively working on solutions that fit this bill and can foster more adoption of programmatic in the OTT industry. Over time, we believe that TV advertising will become more targeted and frequently traded programmatically as brands shift their budgets into OTT, or risk missing a large portion of their audience who are no longer found on linear.
The role the cookie plays, along with tracking and measurement restrictions, will be a major challenge to both the buy and sell side going into 2020. If we consider Google’s stance on building a more private web, it would appear they are reluctant to block cookies outright but rather create a scenario where the end user understands exactly what data is collected and how it will be used, leaving it up to consumers to block tracking as they see fit.
From the resulting cookie re-classification and tracking scrutinization, there will naturally be a drop-off in the volume of high-quality, targetable inventory, which will create heightened competition amongst buyers. Moving back to a contextual environment will be a reality, but there could potentially be a scramble for alternatives that may not be fully realized yet.
It all comes down to the consumer experience. Samsung Ads’ latest research revealed a trend of platform surfing, where consumers switch between linear, subscription video on demand (SVOD), and ad-supported video on demand (AVOD) interchangeably throughout the entire day.
This fragmentation of the TV ecosystem creates challenges for advertisers, for example with reach, frequency capping, and cross-platform measurement. Media buyers and brands need to build advanced TV plans that complement their linear TV buys without over- or under-saturating the marketplace. Still, there are many reasons for advertisers to be excited, as advanced TV is finally delivering the TV measurement and attribution needed for effective campaigns.
Combatting oversaturation of the general OTT market is certainly a big challenge. While new entrants in the VOD space mean greater options for advertisers, it also means more testing to learn which partners can deliver results. Platforms will likely fall into a competitive stride next year, looking for ways to rise above the pack. Whether differentiation comes from advanced targeting technology, marquee spots alongside premium content, comprehensive measurement reporting, or procedural transparency, platforms will have to show up in 2020 and really deliver to sway the hearts of buyers.
There are two topics already gaining traction that will need to be addressed thoroughly in 2020. First, while there is a clear story surrounding the need to push ad budgets to CTV, there is still no unified way to measure audience size across a varying group of apps and devices. Of course, measurement tools exist, but these tools and data vary from platform to platform. Advertisers are pleading for a formalized process before shifting dollars, despite recognizing the opportunity.
Another battle is content transparency. Advertisers today typically have visibility into where their ad ran at the app name and genre level, however, they are asking for more insight into what show or episode the user was watching. Conversely, content partners want to hold onto this visibility and protect their viewers. They perhaps even fear that this level of granularity will minimize their monetization growth, plus, let’s also throw in the obvious element – does today’s technology even allow for this level of granularity?
As an industry, we need more thought leaders at the roundtable to create an open, transparent dialogue to address these challenges head on.
We anticipate advances in technology and standardization that will facilitate consistent quality measurement – including viewability and brand safety – across CTV platforms and providers. The need for independent, quality authentication of OTT/CTV is imperative. DV’s Fraud Lab expects ad fraud across this emerging media to increase in volume and sophistication in 2020, fueled by scarce inventory, high demand, and premium CPMs.
One of the biggest challenges that the OTT market faces, which will continue to intensify into next year, is inventory fragmentation. The continued proliferation of new ad-supported streaming services, including the growth of entirely new cohorts of market participants, creates a challenging environment for buyers, particularly around managing key areas like measurement, frequency, unified reporting, inventory rights, and a scalable workflow. Partners who can help buyers manage these key issues across the ecosystem will continue to grow in importance.
Ad tech in the CTV/OTT space remains convoluted, and an imbalance of standards and capabilities impacts the ways in which publishers can meet the demands of marketers. Data usage, targeting, measurement, and privacy will need to evolve in the coming year, along with capabilities around ad delivery, yield, and optimization. There are many things that publishers like Vevo must consider as we look to distribute and syndicate our content across various platforms, especially given the presence of walled gardens. Each distribution partner has their own nuances when it comes to content delivery and ad serving, and this variation complicates our process for engaging with marketers. As the landscape continues to evolve, we will lean heavily on our ad tech partners to help us navigate the space.
A major hurdle in 2020 will be ensuring ads appear on the right channels so as to stay current and minimize wasting ad budgets. Privacy will continue to be a big challenge as personalization becomes even more important.
Japan’s five major free-to-air broadcasters recently announced plans to begin simultaneously streaming their linear programming in 2020. This is a game-changing opportunity for the industry to grow PMP revenue, but advanced tech (including SSAI) will be needed to monetize live OTT streams at the necessary scale and programmatic efficiency.
In 2019, the industry saw an increase in regulation that we will continue to see next year and years to come. Privacy guidelines will evolve as a result of not only GDPR and CCPA, but the need to keep pace with changes in media and technology. These laws will have a material effect on the way our industry targets audiences and could impact scale against marketers’ audiences as a result.
The continuing changes to privacy regulations that will impact data collection, buying strategies and measurement will lead to new challenges that must be solved. Companies must set themselves up for long-term success rather than building castles in the sand on “quick win” strategies that will face more scrutiny from industry watchdogs and browser regulations (e.g. device fingerprinting). To build a sustainable future advertisers must seek a connected marketing and advertising stack that governs the collection and use of data across all touchpoints.
Header Bidding for video has been a constant source of discussion and debate throughout 2019. Ultimately, Header Bidding looks to democratise access to publishers’ inventory, unlocking the true powers of Addressable advertising across video by allowing programmatic demand to compete with direct sold demand. Header Bidding for Video will provide better value for buyers where relevant, allowing for more precise and succinct targeting and being able to access a desired audience at scale. 2020 looks to see the extension of Header Bidding for video onto devices that utilise Server-Side Ad Insertion (SSAI) extending the democratisation of inventory to Connected TV’s and In-app video. This will be a major evolution for the buying and selling of digital video as the full utility of data led campaigns and strategies will be available at unprecedented scale, couched within brand-safe, professionally produced content on the largest screen in the house. The value exchange has never been higher and the brands which embrace these advancements in ad-tech will have a strategic edge at the beginning of a decade poised for change.
A challenge in 2020 will be addressing the newly found trends of 2019, including the rise of connected TV. The adoption of these new digital platforms, whether incremental or complementary to your existing media plan, enables buyers to reach more viewers across more screens than ever before.
This means the user experience has become paramount to our overall digital strategy. Discovery has great plans to lean in with our partners, like SpotX, for creative solutions to issues that are currently detrimental to the user experience. We believe the solution must come from collaboration.