Advertisers Plan First Enhanced TV Meeting, Generate Keen Interest, Some Anxiety

A group of some of the nation's largest television advertisers plans to meet next month to begin formalizing an agenda for what is expected to be the most ambitious tests yet of so-called enhanced TV advertising formats. The group, which now includes about a dozen marketers, including such heavyweights as Kraft, Procter & Gamble, Unilever and Wachovia, is being organized by a new subcommittee of the Association of National Advertisers, will be the first of its kind, combining the resources and sharing information in an open market forum to jump start Madison Avenue's involvement with such things as addressable television, video-on-demand, and digital video recorders.

The effort, which is being spearheaded by the ANA and which has been endorsed by its influential Television Committee has also attracted the interest of a wide variety of outside players who have a keen interest and some anxiety about how the effort is developed, and especially on its prospects for generating successful results.

The players, which include top executives at some of the largest ad agencies, members of the entertainment, media and technology industries, say the effort could become a new catalyst for the next generation of TV advertising at a time when many believe the traditional TV ad model may be broken, or nearing a breakdown. But they also are concerned that if the advertisers don't take the right next steps, and if the efforts of the ANA's enhanced TV tests don't bear something material, it could set the enhanced TV advertising agenda back years.

"There have been so many high-profile interactive TV test-beds that have failed over the years. Everything from Warner-Amex's Qube, to Time Warner's Full-Service Network, to more recent efforts like ACTV, OpenTV and WorldGate, that there is a real concern that if we don't take the right next steps," said one executive hoping to influence the outcome of the ANA initiative.

While many of those earlier efforts may have been premature, they were also seen as a waste of time and money for some national marketers that yielded few genuine insights about how to interact with consumers in an interactive TV environment. In fact, those failures have helped make the term "interactive TV" a pejorative in advertising circles, one reason the ANA effort is being called enhanced TV.

In truth, the latest effort appears to be motivated more by a sense of imperative, or maybe even foreboding, than out of curiosity for a new way of communicating with and interacting with consumers. The sense is that the fundamental ways in which consumers consume media and are exposed with advertising is changing and that advertisers are losing a grip on that process. The wakeup call has been the new impetus in digital video recorders (DVR), which are being rapidly deployed by cable and satellite TV operators, and which give viewers an unprecedented degree of control. But it is also a recognition that other technologies, especially video-on-demand, could become and advertising deal-breaker if not developed in a way that involves an advertising business model.

In fact, it has largely been the indifference of the gatekeepers of those technologies, particularly VOD, which has the ad community most concerned. Cable operators, while interested in developing more of a relationship with Madison Avenue and figuring out ways of exploiting VOD and addressability to make advertising work better and become more relevant to their subscribers, have largely made it a back-burner issue because of the more immediate revenue potential of marketing services directly to their subscribers.

Despite the leadership efforts of companies like Comcast, whose new Spotlight unit is testing and deploying new forms of addressable TV advertising services, the fear on Madison Avenue is that cable and satellite TV gatekeepers ultimately may not need advertising to have a sustainable and lucrative business model.

To make sure that doesn't happen, the ANA initiative, which is being chaired by Unilever media chief Brad Simmons, and which is expected to involve many of the ANA's top TV committee members, is implementing a unique strategy that will amass the spending power of a group of major advertisers who will for the first time share their learning among themselves and with the industry at large.

"Some advertisers have tested some or all of the emerging models, but for proprietary reasons , the results are not widely shared. This inhibits the learning, which could accrue to all interested parties. Since little information from these trials is broadly shared, they are not gaining traction with the advertising community," wrote ANA president-CEO Bob Liodice in his blog this week. Liodice and other members of the ANA declined to comment on the status of the project until all of the members participating in the effort have signed off, but given the complexity of organizing the effort, it does not appear that the ANA will meet its initial goal of beginning some testing in the second quarter of this year.

That's not because of a lack of interest in the project. At least a dozen ANA members are expected to participate in so-called "test cells" that could last upward of a year each. The findings of those tests will be measured, shared and redeployed in ways to gain additional insights, and ideally, the involvement of additional players.

To date, the ANA effort has been leaning heavily on one outside player, Carat Digital executive Mitch Oscar, who also manages his own consultancy Hocus Focus. Oscar has been the main point person on the project, but the ANA is believed to have been solicited by and has reached out to a number of outside players, and is said to be considering the involvement of yet another high-level enhanced TV guru, or maybe even a big research group such as the Yankee Group or Forrester Research, to play a role.

Another big question that has yet to be resolved, is the potential role of an advisory committee that would be comprised of other knowledgeable executives from top Madison Avenue agencies, such as Starcom MediaVest's Tim Hanlon, or players from technology, entertainment and media companies. The ANA is expected to form such a committee, but doesn't want to formalize the idea until it can be presented to members participating in the project, most likely during the initial agenda meeting.

Other players who have been actively involved, include Art Cohen, a long-time interactive TV executive, who is also the head of the Interactive Television Association; as well as Shelly Palmer, a television programming producer who is head of the advanced television committee of the New York chapter of the National Association of Television Arts & Sciences.