While Disney offers some of the most premium content to advertise on, some media buyers are concerned that the company hasn't innovated as much as its competitors when it comes to advertising technology and audience targeting.
Several media buyers who work with Disney said that the company is behind its media competitors in its approach to programmatic advertising technology, which allows brands to buy advertising while leveraging software and data insights. It allows advertisers to figure out the best times and places to reach their desired demographics, as well as segment the audience into more niche groups besides age and demographic.
Disney on Thursday reported fiscal fourth-quarter earnings that missed estimates. The company posted revenue of $13.14 billion and adjusted earnings of $1.10 a share. The Thomson Reuters consensus estimate was for $13.52 billion and $1.16 earnings per share.
Though Disney CEO Bob Iger said in a statement he was pleased with the company's performance, investors have been wary after Nielsen reported ESPN lost 621,000 subscribers in one month. The media company said it was a "historic anomaly for the industry and inconsistent with much more moderated trends observed by other respected third party analysts."
Sports remains one of the biggest draws for advertisers, especially because it is one of the few programming options left that people watch live. It also reaches a coveted young male millennial demographic, a notoriously difficult group to market to. ESPN tested selling some "SportsCenter" ads programmatically in December 2014, according to The Wall Street Journal.
The use of programmatic advertising technology to reach even smaller groups of consumers across different screens is a growing practice, and many companies are betting it will be a big industry. Verizon purchased AOL and is in talks with Yahoo to grow its ad business. Meanwhile, AT&T is purchasing Time Warner in order to own both content, which could be used through its addressable advertising product AT&T AdWorks. The service allows brands to reach people on mobile, TV or any other device.
The sources also said that Comcast, which owns NBCUniversal, Fox and Time Warner's Turner have been heavily touting their programmatic ad offerings. One source added that although CBS is a little behind in programmatic right now, the industry expects that when it partners with Viacom, it will have a competitive edge above Disney in this type of advertising.
Disney said the following in a statement emailed to CNBC:
The Walt Disney Company has sold a portion of inventory programmatically for years and is invested in the use of data to help create better targeting as well as better advertising. One example of our data-driven innovation is ESPN's LiveConnect, which taps into the largest data-rich portfolio of sports fan insights in all of media to help brands reach fans through outcome-based advertising during key sporting moments. Other examples include the use of viewing and behavioral data to optimize traditional TV schedules, and a Disney-wide digital portfolio offering that allows clients to leverage 1st, 2nd and 3rd party data for enhanced targeting. These offerings have been successfully implemented by dozens of clients, and are increasingly in demand due to their positive impact on clients' sales.
Disclosure: Comcast is the ownerof NBCUniversal, the parent company of CNBC and CNBC.com.