Myth buster: Connected TV advertising’s major misperceptions

By Tim Peterson

For as much as connected TV advertising has matured in the past few years, the emerging medium maintains a mystique that has given rise to myths that must be dispelled. Here is a sample of some major myths regarding CTV advertising.

Technically, CTV doesn’t have a cookie problem because the web’s de-facto identity technology doesn’t work on CTV. But CTV does have an identity issue in the form of the IP address.

The IP address is CTV’s version of the cookie, both in how it provides an identity backbone but also in how vulnerable that backbone has become amid increased privacy scrutiny. “The IP address as a standalone identifier is going to end up like the cookie,” said Jay Prasad, chief strategy officer of identity technology provider LiveRamp.

Not only do privacy laws like the California Consumer Privacy Act categorize the IP address as personal information, but Apple and Google have taken aim at limiting companies’ ability to access the IP addresses associated with people’s devices, which would allow companies to identify people through a controversial method called device fingerprinting. “If you’re associating an IP address and then using that to try to understand somebody, then that’s the definition of fingerprinting,” Prasad said.

Considering that the third-party cookie continues to persist, the IP address may as well. However, given regulatory red flags popping up around the IP address, companies would appear to do well to wean themselves off it asap and work on adopting CTV ad strategies reliant upon contextual targeting and/or first-party data.

Myth: Premium CTV ad inventory isn’t sold programmatically.

Programmatic has a reputation for referring to remnant inventory, which would appear to be antithetical to TV-quality ad time. But, despite being a computer-based method of buying, programmatic is not so binary.

TV networks and streaming-only sellers like Amazon, Roku and streaming pay-TV provider FuboTV make their top-shelf CTV inventory available for programmatic purchase. Usually, this takes the form of programmatic guaranteed (PG) and private marketplace (PMP) deals so sellers can maintain some scarcity and not open themselves up to the lowest bidder in the programmatic open auction. “Programmatic, when it’s done directly, that’s the majority of what we see from a CTV perspective,” said Diana Horowitz, svp of ad sales at FuboTV.

But these top-tier ad sellers do also open up their premium CTV inventory to the programmatic open auction when private programmatic buyers have not snatched it up.

“There’s a lot of premium inventory that the networks are saying is only available [via traditional direct deals] or PG, and we get reports back from our programmatic buys that tell us the opposite. There’s a decent amount of premium inventory available through PMP or the open exchange,” said one agency executive.