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  • Writer's picturegervelis

Is There An Upcoming Supply Shortage In Premium TV Ad Inventory?

It’s an exciting time for digital media and It’s no secret that we are in a new age of audience based marketing, powered by data. One of the biggest disruptions in the media space is the new techniques that OTT (Over The Top) and Programmatic TV bring to our tool belts. We have seen how the social giants have dominated ad budgets with self-service programmatic audience targeting in the native world. I believe that this new wave of OTT and Programmatic TV will have an equal impact on advertising budget.

As advertisers race to influence audience through this new medium, I must ask the question, will there be an upcoming shortage in available ad inventory within the OTT and Programmatic TV space?

Contributing Factors to the Upcoming Shortage

1. Earlier this year NBCUniversal announced a 20% cut in TV commercials across all of their channels. FOX also announced a 40% reduction in TV ads during its Sunday prime time scheduling. It is basic supply and demand, with a reduction in premium audience inventory, the cost of media will go up. Also, with less inventory available advertisers will seek other premium channels to influence audiences.

2. Subscription to ad free OTT services (Amazon Prime, Netflix, Hulu, Roku, Apple) are on the rise. Consumer eyeballs are moving toward ad free video content and this trend is not slowing down. In Q2 2018 Netflix added 5.15M subscribers to reach 130M globally, and Hulu added 3M paid subscribers this year, reaching 20M in the USA. Major OTT players have yet to launch ad models inside of their subscription services. Yet another blow to the supply of premium inventory.

3. In May 2018 CBS announced a partnership with Nielsen to introduce dynamic “programmatic” ads to make TV commercials more relevant. Disney also launched a new suit of new products called Luminative that includes programmatic TV. Facebook boosts over 5M advertisers due to their programmatic capabilities. I’m betting that programmatic TV will attract more advertisers to a depleting amount of premium inventory. Digital platforms like 4C Insights are already capitalizing on the ability to offer advertisers premium TV ads served to the same audience as their social ads reach. Engaging an audience using TV and Social, from one platform, is a game changer.

With the premium audience access in short supply and the demand raising, it’s not foolish to predict that the cost for audience access will increase. Increasing costs will drive advertisers to seek new ways to engage audiences. Fortunately, two major sources of premium inventory are being introduced to the market.

Emerging Markets in Digital Media

  1. Podcast Media: 73 million people in the USA subscribe to podcasts, this number is up 24% from 2017. Last year IAB said that Podcast advertising will grow to hit $220M in 2018. Even with this new addition of ad inventory it will not offset the upcoming supply shortage in the TV world.

2. Programmatic Radio: Spotify and Pandora are dominating the programmatic radio space, and Pandora just launched their audio programmatic marketplace to the world in late July. This growing medium will offer advertisers another premium ad experience to influence their audiences.


With consumer eyeballs moving to OTT and premium networks reducing the amount of TV ads may introduce a shortage in supply of premium TV inventory in the upcoming years, thus increasing the cost of media. As advertisers search for new ways to engage audiences Podcasting and Online Radio will experience a raise in demand for their inventory. Ad tech players are capitalizing on the new ability to engage audiences using access to TV inventory that OTT and network players that are moving to programmatic are providing.

It’s an exciting time for digital media, and it seems that the consumer is the winner with less ads and more ways to experience premium content!

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