Reporter's Notebook: Ad:Tech San Francisco

by Tobi Elkin, May 25, 2004, 12:00 AM

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SAN FRANCISCO -- Online publishers and portals want to beg, borrow or steal media dollars from marketers' TV and other offline media budgets, but exactly how they do so? Broadband video advertising is at least one strategy, according to publishers, portals and technology providers attending the Ad:Tech trade show here.

Their rationale: If the eyeballs are online, so should the dollars should be. Just how to aggregate TV audiences online was the topic du jour on Monday during the conference session "Leveraging Interactive Broadcast and Broadband."

Chas Edwards, vice president-business development, CNET Networks, said consumers find TV commercials online less intrusive than when the same spots are viewed on TV. He cited Yankelovich research showing that 64 percent of consumers find TV ads extremely annoying and 77 percent of TiVo users skip commercials. Edwards said CNET would eventually replace most of its graphics with video.

ESPN Motion Director and General Manager Ed Davis, and AtomShockwave CEO Mika Salmi both said their video products were designed to be downloadable in order to maintain control over the quality of the video delivery. Davis said a new feature on ESPN Motion would enable users to send video clips to friends who haven't downloaded Motion. Despite the fact that the application must be downloaded versus the company streaming it, ESPN's Motion product has been popular with advertisers and users. ESPN.com is selling Motion inventory during the broadcast network and cable upfronts. In fact, one-third of the ad inventory on ESPN.com is earmarked for Motion, according to Riley McDonough, VP-advertising, ESPN.com.

Microsoft's MSN, by contrast, is in no hurry to sell MSN Video Service inventory. "We are now preparing our sales force for general sales [of the MSN Video Service] but our business is not guided by the broadcast TV upfront," says Stephen Moss, general manager, advertising and sales, MSN. Moss, who's been heading the east and central regions for MSN ad sales, has recently segued to a larger role, managing national field sales.

Moss says MSN took a conservative approach to selling the video service which launched in January, "This wasn't about seeing how many advertisers we could sign on as quickly as possible; our goal is to manage the process well." Disney Travel and Sprint PCS have recently begun appearing on the service and MSN's streaming video evangelist Todd Herman says "6 or 7 new advertisers will start to appear" on the service in coming weeks and months. MSN's deal with Fox Sports, the portal's deal with ESPN expires June 30, is also likely to spawn new advertisers for the Video Service.

The rise of consumer control, a la TiVo and the Web, is fueling online creativity, according to participants on a panel called "Leveraging Interactive Broadcast and Broadband, Impact of Brand Exposure Duration." Karim Sanajabi, executive vice president, Carat Interactive, showed attendees a campaign the agency launched for Adidas. The "Impossible is Nothing" campaign featured video ads that ran on MSN and Yahoo!. Sanajabi said the effort generated 5 million views and lifted brand awareness by 6 percent. Carat's campaign promoting MTV's Sunday Stew yielded a cost-per-thousand of $3.17 and generated a 50 percent increase in viewership.

Maven Networks CEO Hilmi Ozguc showed an Internet video campaign promoting the film "Master and Commander" which generated a 26 percent click-through for ticket purchases. Maven technology powered downloads of the movie trailer and behind-the-scenes footage. A campaign to promote Virgin Music artist Ben Harper offered a "send to a friend" feature whereby senders could get a free, previously unreleased single to download. Ozguc says the online promotion helped triple Virgin's fan database for the artist.

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