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Competitive advertising strategies for programmatic television

Author

Listed:
  • Ivan Guitart

    (EM - EMLyon Business School)

  • Guillaume Hervet

    (EESC-GEM Grenoble Ecole de Management)

  • Sarah Gelper

    (TU/e - Eindhoven University of Technology [Eindhoven])

Abstract

Programmatic television advertising technologies allow advertisers to detect the placement of competitor ads and schedule their own ads almost in real time. This paper investigates how managers can improve the effectiveness of their ad schedules by considering the relative placement of their ads with respect to competitor ads. By analyzing a dataset of more than 43,000 own-brand and 49,000 competitor TV ad insertions, we propose and estimate the effects of four ad scheduling strategies on online conversions. The best strategy is to place ads in isolation, either when competitors are not advertising at all or advertising on other stations; this avoidance strategy results in the greatest effectiveness of own-brand ads and delivers conversions from competitor ads. If an avoidance strategy is not possible, brands should advertise more heavily than their competitors. Doing so mitigates the substitution effect of competitive advertising, which occurs when competitor ads outnumber own-brand ads. Our analyses show that adopting programmatic television technology would have led the focal firm to increase the conversions from television advertising by 59%.

Suggested Citation

  • Ivan Guitart & Guillaume Hervet & Sarah Gelper, 2020. "Competitive advertising strategies for programmatic television," Grenoble Ecole de Management (Post-Print) hal-02312409, HAL.
    • Handle: RePEc:hal:gemptp:hal-02312409
    DOI: 10.1007/s11747-019-00691-5
    Note: View the original document on HAL open archive server: https://hal.science/hal-02312409
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