Advertising

Advanced Advertising 4.0

9/19/2011 12:01 AM Eastern

Group M’s Bologna: Addressable Ads Finally Approaching Scale

NEW YORK — After six years of everyone in the industry talking about it, including
himself, Michael Bologna, director of emerging communications for
GroupM, said addressable advertising is finally starting to resemble scale.

“By the end of this current year, we could see scale in addressable advertising
upwards of 15 million homes and that’s important to our business,” Bologna
said.

Bologna calls the ability to target not just core demographics, but specific
households and eventually individual viewers “the holy grail of television,” with
improved targeting and reducing waste equaling a better return on investment
for advertisers. But to achieve real scale, that 15 million households will have
to grow to 40 million, to the point where all digital video recorder boxes have
addressable capability, he said.

“Only then will we be able to take a commercial that was purchased nationally
and divide it and cut it up addressably across all the participating
systems,” Bologna said in a question and answer session with B&C business
editor Jon Lafayette.

But achieving that scale is going to take more than just time, especially
working with advertisers accustomed to a traditional cost-per-thousand basis.
With hyper-targeting, Bologna has found the planning -— who to reach, how
often, et. al. — to be the hardest part of the process.

Another major hurdle is that interactive advertising still lives within each
local cable operator’s system, requiring clients to repurchase schedules on
networks and programs they have already secured nationally to support the
interactive functionality.

“There’s nothing quick, short or easy about coming up with a targeting scenario,”
he said.

— Andrea Morabito, Broadcasting & Cable

Providers Fight for Playing Field Positioning

NEW YORK — In one of Canoe Ventures’ first appearances in a public forum
after executive shuffling in July, newly appointed chief product officer Arthur
Orduña
said several new products are in the pipeline, including an electronicfulfillment channel and a suite of interactive in-program applications.

Orduña was among the executives on the “Achieving
Scale with One-to-One Marketing” model, moderated
by B&C business editor Jon Lafayette.

“The last two and a half years have been blocking
and tackling and building out the platform,” Orduña
said, and the company is testing new products such
as the ITV applications, which include in-show polling
and trivia questions. Initial results, he said, are “extremely
positive,” with more information to come later
in the fall.

Executives from Comcast Spotlight, Zenith Media
and Google joined Orduña in discussing initiatives and
solutions to meet clients’ demands in the era of advanced
advertising and ITV, with addressability on the forefront of marketers’
minds.

Addressability is not part of Google’s capability right now, said Mark
Piesanen
, director of strategic partner development at Google TV, but “as the
inventory shapes itself in an addressable fashion, we hope to be players of
that as well.” Piesanen also noted that Google is tapping into the audience in
the “peripheral” inventory.

The cost of advanced advertising — including the research costs and the
expense of the tools to create such solutions — have marketers worried that
the waste will overrun any ROI. Bruce Goerlich, chief research officer at Rentrak,
said waste has become very complex in the wake of advanced advertising,
due to the difference of where, when and how consumers view content.
“Only large [research] databases are going to allow you to look at all those
different things,” he said, referencing both census-based and survey-based
data collection.

With advanced advertising becoming more prevalent, some wonder if ITV
will become the standard. Robert Ivins, vice president of data development
at Comcast Spotlight, said: “It’s not necessarily turning television purely into
one-to-one play. [T]here is real opportunity in the next few years to refine,
make better and to start adding some layers” to the existing advertising landscape.

Even with the forward-looking nature of advanced advertising, Sean Reardon,
senior vice president, strategy and planning director, Zenith Media, said
the question is not, “what is the next thing we have to watch?” but rather
“when is it going to enable speed to that scale?”

— Lindsay Rubino, Broadcasting & Cable

Economy, Lack of Ratings Hampers Advanced Ads

NEW YORK — Lack of audience measurement and the poor economy are
hampering advanced advertising opportunities on new video distribution
platforms.

Participants on the “One Message, Many Screens — Targeting Ads In a Multiplatform
World” panel said platforms such as the Web and mobile phones
are fertile areas for ads. Trying to communicate the value and the reach of the
new platforms to potential buyers is difficult, though, according to Jeff Siegel,
senior vice presidnt of worldwide advertising for Rovi.

“One of the challenges of advanced advertising is not only the difference
in terminology about what our experiences are, but you certainly have differences
in what the metrics look like and how you report it, so commonality is a
real challenge,” he said.

He added that the company has data that proves consumers are interacting
with its product — that 86% of people go to the guide to find programming
— “but [it’s] difficult to translate that data back to a GRP, and that’s the challenge
of the conversation.”

But Frank Foster, vice president of IPTV solutions for AT&T AdWorks, says
it’s not that difficult to determine
how effectively a
campaign is reaching
audiences.
“You can’t have
perfect be the
enemy of better …
you don’t have to
come up with this
thermonuclear,
more survivable
solution [to make
money].”

Jen Soch, senior vice president of activation and director for advanced TV
for SMGx, said that the uncertainty of the current economic climate is also
slowing down the move toward new platforms. “We’re still going to need a lot
of things to move money into new areas, especially in this economic climate,”
she said. “As we move forward we need more research and accountability …
we can add more [measurement] enhancements to get us further down the
path.”

— R. Thomas Umstead

Microsoft’s Porter Says Industry Is Ripe for New Methodology

NEW YORK — With the economy and the stock market in flux, marketers may
become wary of deviating from standard advertising practices. But David
Porter
, Microsoft’s video advertising evangelist,
says that now is the time to push these advanced
methods.

In a Q&A session with Multichannel News technology
editor Todd Spangler, Porter said that the latest
Nielsen data shows that TV viewership still continues
to grow (to four hours daily.) “That’s a real testament
to America’s love affair with TV,” said Porter. “As long
as the viewer is there, TV is a fantastic business.”
Porter also said that TV spending is up, with cable
leading the way with 12% growth.

For audience measurement, Microsoft, he said,
relies on more than standard demographics, instead
targeting viewers based on lifestyle, behavior, and purchase-
based activity. Porter argued that this method
helps them find “pockets of viewers in unsuspecting
places,” thus the commercials are seen by a higher viewing percentage of the
target audience. “Targeting does not have to be addressable, it can be more
precise than mass media,” he said.

Porter, who exited the cable industry in June when he left Cox Communications
for Microsoft, said that with the amount that cable operators have on
their plate (retaining their subscriber base, inking carriage agreements), they
need to partner with different participants in order to move forward. “They
don’t have to have a ‘build-it-ourselves’ mentality,” said Porter.

He argued that there will always be the primetime, mass-appeal content
on TV, but what goes overlooked is the leftovers. “We’ll always have the premium,
primetime content,” said Porter. “But then there’s all the rest of the
content on TV.”

— Tim Baysinger, Broadcasting & Cable

September