Commentary

Digital Video: Time To Tell Traditional TV Advertisers Your Compelling And Easy-To-Understand Story

by Wayne Friedman , Staff Writer, February 4, 2011

Digital video executives still know what traditional TV advertisers want: the right message at the right time, perhaps with competitors placed in different commercial pods or not in the show at all.

Forget about "behavioral targeting" and "return on investment" and all the bells and whistles the Internet seems to promise marketers. Let's go with the easy stuff.

"Traditional TV has too many ads," wrote Jason Kilar, CEO of Hulu, on a recent blog.

Clutter. Every media agency, advertiser executive and television executive has heard the groans about this for years. More importantly, the word elicits an immediate emotional reaction. Everyone hates advertising clutter - both buyers and sellers. Non-program time keeps rising -- 14-15 minutes per hour on broadcast networks, a bit higher on cable networks.

Jon Nesvig, Fox TV's recently retired president of advertising sales, tried to give advertisers what they wanted a few years ago by drastically cutting back ad inventory on some shows. The experiment didn't exactly work, but it was a valiant attempt to solve the problem.

With so much in flux when it comes to the digital video world -- a variety of audience metrics, formats, ad networks and digital media packages, just to name a few - it was somewhat a breath of fresh air to hear Kilar stick to the obvious and simple: digital video platforms have way less clutter that traditional television.

The average amount of non-program time on big-time TV shows that re-air on digital sites is around five to six minutes for an hour show. That is one of the prime reasons sites like Hulu can command three to four times the CPM of other national TV platforms like broadcast, cable and syndication -- and why Kilar says Hulu will double its advertising take this year to some $500 million.

It definitely makes sense to start shouting this message now in the months before the TV traditional upfront market begins -- one which pulls in around $18 billion from all the national TV platforms.

Digital video platforms, like Hulu and TV.com have been around for a few years now. That, in itself, can give marketers some comfort -- any may one day finally push traditional TV marketers to move bigger pieces of their media budgets to premium video sites.

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2 comments about "Digital Video: Time To Tell Traditional TV Advertisers Your Compelling And Easy-To-Understand Story ".

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Jay Oconner from World Colours Network Inc., February 4, 2011 at 5:42 p.m.
HULU.com could become the Web’s MSO if they would open the gates for Content Owners to use Product Placement Brandcasting technologies which would allow a viewer to purchase anything seen via streaming video. WCN your Brandcasting Partner is working to help change the model for IPTV as a extension of the Broadcast options while it lasts. Viewers are tired of subsidizing reruns and if a subscription option is going to work there must be a innovation which make it advantageous to make that additional investment. As one commented on the referenced blog said, he prefers to watch the Daliy Show on the Daliy Shows.com. For that user to be swayed you have to activate the show in ways that even the audio is mapped to additional information including merchandising opportunities. In all there must be Alliance and Collaborations formed to allow producers to get financed and Artists and Actors including all the supporting cast down to the Craft Service workers benefit from a new revenue stream that Advertisers will flock to when they understand the power of the data exchange knowing who clicked on their product and how many made a instant purchase decision.
We look forward to comments, questions and total engagement of all stake holders in Entertainment and Media.
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Doug Garnett from Protonik, LLC, February 4, 2011 at 5:43 p.m.

This is interesting thinking. But I wonder if there's a different potential side to clutter. Perhaps what agency types see as "clutter" is merely the way advertising must work. And that cutting it back might make advertising in that medium less effective. Remember, Hulu is only reaching the completely wackiest of early adopters - not even an early majority.

Because wrapped up in this theory is the strange idea coming from the tech world that we're going to be able to "target" so well that we will be able to predict which ads a given consumer will care about.

That's bunk. Even if I hone in with laser-like perfection and consider 100 consumers who perfectly fit a very refined target audience, I'll be lucky if 3 of them are in a position where they care very much when my ad shows. The other 97 could resent my intruding on their space.

So I hear what Hulu's suggesting. But I also think they're wrong. The current system on TV, on the web, on social media, outdoor, in print --- everywhere --- works because people see a range of things and choose which ones matter to them.

Underlying this argument is an absurd arrogance from advertisers and internet companies who think we can pick on behalf of consumers. This type of arrogance is nothing new in either of field. But I'd hate to see our arrogance once again destroy something that works quite well for consumer and advertiser alike.

In fact, it's convenient that creative & media directors get to blame clutter. Looks to me like the real problem is their TV advertising is meaningless to consumers.

At my agency, we often find that a few million dollars put behind our product oriented TV advertising causes dramatically more brand impact (and retail sales) than much budgets 5 to 10 times bigger when put behind traditional "statement-style" brand advertising.

Perhaps they should care far more about returning meaning to advertising than inventing this new model that really won't change much - except drive up TV ad prices.