Is TV Buying Next In Line For Brand In-Housing?

As connected TV advertising grows, the ability to buy TV inventory programmatically would in theory create the opportunity for brands to bring TV buying in-house. But are brand advertisers taking up the opportunity?

Several DSPs VAN spoke with said they have seen more business coming from brands. “It’s definitely happening, but it’s definitely early days,” said Cadi Jones, commercial director EMEA at Beeswax. “In Europe it’s very much in an exploratory phase, especially when it comes to CTV, less so when you’re talking about BVOD [broadcaster video on-demand].”

Dave Castell, general manager EMEA of inventory and partnerships at The Trade Desk agreed. “In-housing TV is definitely something that we’ve seen to some extent,” he said. “Certainly, recent developments in tech make it easier for brands to go it alone.”

Both said the trend has been particularly prevalent among direct-to-consumer (D2C) brands. As VAN has previously reported, D2C brands are increasingly turning to TV to both extend their reach and to run brand-building campaigns.

D2C brands, many of which initially find customers via in-house digital campaigns (often largely run on search and social media platforms, which tend to have relatively straightforward self-serve tools), will be more likely to want to handle TV buying themselves, since it’s what they’re used to.

And Castell says some broadcasters are actively seeking these brands out themselves. “Some savvy broadcasters are aware of it and are forming deals with D2C brands who perhaps don’t have an agency but want to operate at scale,” he said.

Since D2C brands are new to TV, it means there’s a substantial opportunity for broadcasters to tap into new money. “This isn’t about broadcasters cannibalising their existing customer base, it’s not about Coke spending money directly instead of through their agency,” said Jones. “This is about brands which haven’t historically been able to enter into the TV market suddenly being able to reach people through that medium, and getting quite excited about that.”

It isn’t restricted entirely to D2C brands though, and as in-housing has been more common among bigger brands with more resources, we might see more large brands moving in the same direction. But both Jones and Castell said there’s still a number of barriers for brands considering in-house buying for IP-delivered TV.

“The European broadcast market has a range of particular idiosyncrasies,” said Castell. “This ranges from the way that advertising is bought and sold, to the complex nature of measurement, not to mention the actual technical delivery of content, which is often bespoke to each broadcaster.”

Jones meanwhile said cost is a big factor, which is made worse by high tech fees. “If you’re paying a DSP 10-20 percent of media, that suddenly adds up to a huge amount of money. If you think it’s bad in digital on a £2 CPM, if you’re paying ten times that or more, you’re suddenly losing a huge amount.”

But as brands work around these problems and experiment with buying CTV and OTT inventory themselves, will they try to do the same for linear TV?

Carol Reed, SVP of global buyer development at OpenX, says CTV opens up some new opportunities in linear TV advertising. “What’s interesting is that this trend is creating the possibility for a feedback loop to connect back to linear TV buying – taking the data application and insights gleaned from addressable and digital, and using that to model where money can be optimised on linear buys,” she said.

And some broadcasters, including ITV, have talked about working more directly with brands. But this doesn’t necessarily involve cutting out media agencies from the buying process.

ITV CEO Carolyn McCall explained her aims on a recent earnings call. “We have good relationships with advertisers, but they are welcoming the business conversations we’re having with them in a tougher environment where we are able in many different ways to help them improve their businesses – in terms of footfall, in terms of price,” she said. “We’re doing certain things with them where if we just had a media interaction with them, you’d be talking about spot advertising. That’s where the direct relationships become very valuable, because you get much closer to their businesses.”

And Reed believes that the nature of linear ad sales, where inventory is largely bought up front for fixed prices, means agencies will likely continue to play a crucial role. “I expect that most brands will continue to rely on agencies for their negotiation clout and ability to secure inventory at a more efficient cost,” she said.

But brands might become more demanding in what they expect from media agencies for linear TV buying. “I believe that we will see more marketers lean in heavily on pushing the data agenda behind TV – asking for TV buyers to think more about data insights and performance, and forging a more holistic approach that target users seamlessly between their overall video strategy (inclusive of both linear and addressable TV) and their data-led programmatic efforts,” she said.

Castell agrees that in the TV world, it’s likely that the role agencies play will evolve. “There’s no real drive to cut agencies out completely,” he said. “There will always be a need for agencies, as they evolve to become a more consultative partner for brands. It could be that they’re used for different things – and that may well be cyclical rather than a permanent move.”

“Ultimately, when it comes to scale, agencies still have the massive leverage and expertise to give brands a cutting edge, and that doesn’t just go away,” he added.

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