Rethinking Programmatic Advertising: The Case for In-House Ad Sales in Broadcasting

The programmatic trading ecosystem has been a game-changer in the world of digital advertising, offering a streamlined, automated process of buying and selling ad inventory. However, this system may not be the ideal fit for broadcasters, especially those in the FAST (Free Ad-Supported Television) Channel industry. The allure of outsourcing ad sales to third parties is tempting, but it comes with significant drawbacks.

The Pitfalls of Programmatic Trading for Broadcasters:

1. Loss of Control: By relying on third parties, broadcasters lose control over their business cash flow. The revenue share model often means waiting months for payments, which can hinder operational fluidity.
2. Diluted Revenue: Programmatic trading typically results in a fraction of the potential revenue. In-house ad sales, on the other hand, can lead to payments within days and a more concentrated inventory, ensuring a 100% fill rate.
3. Higher Earnings Potential: Direct ad sales can yield more than double the revenue for the same audience statistics compared to programmatic trading.

The Growing Disparity in the Ad Industry.

Ad agencies are thriving under the current model, often at the expense of content channels. The wealth gap between these entities is widening, and while no single company can rectify this imbalance, a shift in strategy could be the solution.

A Strategic Shift for FAST Channels.

By selling a high percentage of advertising internally and using platforms like Kapang adx for backfill, FAST channels can reduce risk and foster the growth of an internal ad-sales structure. This approach allows for a gradual transition away from reliance on programmatic trading.

Injecting Oxygen Back into the Industry.

Ad-tech firms are currently claiming a lion’s share of the revenues from FAST Channel television and video content. To revitalize the industry, broadcasters must pivot away from the “lazy” outsourcing model. Kapang adx offers a lifeline by enabling channels to sell their own direct Private Marketplace inventory. With self-service tools and in-person sales techniques, broadcasters can reclaim revenues and combat the greed prevalent in the programmatic ad-tech industry.

Conclusion on Ad-tech taking over.

The programmatic trading ecosystem has its merits, but for broadcasters looking to maintain control and maximize profits, an in-house approach to CTV sponsorship and ad-sales is compelling. It’s time for the industry to reassess and embrace strategies that prioritize financial health and autonomy over convenience.