Canoe Ventures, Linsanity & TV ROI
You know what they say about the best-laid plans: more often than not, they don’t really get you anywhere. That was the lesson of last week’s top media news.
On the one hand, you had the demise of Canoe Ventures, whose plans couldn’t have been better laid by its big corporate sponsors. And on the other, the totally unanticipated, stunningly meteoric rise to NBA stardom of an undrafted Harvard grad named Jeremy Lin. How’s that for a contrast? (And, yes for this avid hoopster, all analogies, metaphors, and business lessons these days pass through the Land of Lin.)
The effective sinking of Canoe (sorry) marks a significant milestone for our industry. We collectively have big hopes for addressable advertising, but the dream is not to be realized, at least not through Canoe. David Verklin and Kathy Timko -- both phenomenally smart and accomplished executives -- did the best they could. Verklin’s original vision was compelling and Timko’s execution was on target. But consortiums always present serious challenges, and in Canoe’s unfortunate case, its stakeholders were also its competitors. So this was a structural issue, not a strategic one.
I don’t believe for a moment that Canoe is the failed experiment some commentators have claimed it to be. Canoe made important headway in getting the broader industry excited about the power of Big TV Data and the potential reach of targeted TV advertising. Addressable advertising remains one of the most promising developments in television today, but the iTV industry has its work cut out for it, as Deloitte confirmed in a report this week. What we need to see now is a solution (or multiple solutions) that can bypass the technical, privacy, and structural hurdles of our industry to offer advertisers easy and reliable access to the right audiences.
And maybe we can get most of the way there by using single-source data to simply target the right networks and programs. The result? More ad dollars for networks and more efficiency for advertisers. As P&G’s CEO Bob MacDonald said this week in announcing $10 billion in cuts: "We want to increase reach, frequency, and the effectiveness of our advertising impressions to consumers. Even delivering a modest level of efficiency each year can amount to nearly a billion of savings versus just letting these costs grow at the same rate of sales. We're very confident we can do this while building the number and quality of consumer impressions each year."
Canoe’s problem was that even with $150 million of support from the biggest cable players, they couldn’t deliver on their promise, because they were applying traditional-media practices to an emerging-media problem. As I’ve written before, this is always going to be a losing battle. Innovation can’t originate with entrenched players committed to conventional technologies and business models. Too much friction.
In fact, I’d even go so far as to say that Canoe failed for the same reason that Jeremy Lin went unnoticed until a few weeks ago: The conventional approach to scouting and drafting left him to slip through the cracks.
Lin isn’t the first surprise star in sports, but he might just be the biggest. Talk about ROI -- look at the effect he’s had not only on the Knicks, but on our culture in general. Lin has singlehandedly ended our collective post-strike indifference to the NBA -- lifting ticket prices, television ratings, and global interest to their highest levels ever. He’s helped resolve MSG’s stalemate with Time Warner Cable, attracted new audiences to the game, and changed the way pro scouts look at players from smaller colleges -- all in the space of a few weeks.
Like Harry Potter, Susan Boyle, and even Mark Zuckerberg, Jeremy Lin arrived out of nowhere and made us question everything we thought we knew about how to find the right diamond in the rough. Lin’s the right person on the right team at the right time. And now everyone is trying to figure out how to find the next Lin, by using “best practices” to target the next undiscovered star. What’s that mean to us in television? Quite frankly, this is where the comparison breaks down. So let’s stop trying to understand and just sit back and enjoy the Lin Show. And use the best technology solutions to create a more accountable TV.