• by Steve McClellan , Staff Writer @mp_mcclellan, April 13, 2012

Programmers knock themselves out to create seamless and customized packages

For years, critics have been predicting the demise of TV networks and the bedrock of their ad model, the 30-second spot. But far from being dead, TV nets continue to thrive. And they’re learning how to boost the value of the viewers that are watching shows outside live scheduling windows, where audiences are turning to watch in increasing numbers.

Networks and agencies, of course, are analyzing those shifts inside and out. Their future success depends on their ability to help advertisers understand and navigate those changing patterns in order to keep their commercial messages in front of target audiences — where and when they decide to watch. And while the 30-second TV spot is still considered one of the most effective forms of advertising, it’s more effective still when used as the foundation for multiscreen marketing packages that link to the growing array of platforms where viewers are consuming media.

And networks are adopting new business models as they refine their integration strategies. Case in point: CBS. At a recent media conference in New York, David Poltrack, the network’s chief research officer, said that over the past year, the network had increased its online ad loads in CBS programs to 14 ads per hour, far more than the four ads it had originally placed in online shows. The reason? Sister network CW made a similar move two years ago and found viewers accepting of the heavier online ad loads.

The question for CBS was whether its older audience would also tolerate the increased number of online ads. As it turns out, the viewers didn’t balk, Poltrack says, adding that the company’s sales department has been able to obtain online CPMs that are significantly higher than those achieved for broadcast TV.

The upshot, says Poltrack, “is that a viewer streaming our program online is now worth substantially more to us than a person watching that program in playback mode skipping many of the commercials. In fact, the value of the online viewer is now surpassing that of the live viewer as well.”

That’s also the case at ESPN, which is saying a lot given that its live TV audience comprises one of the most profitable networks on the air today. In addition to its TV networks, ESPN has strong online and mobile presences. “In many ways, we think the Internet or digital viewer is even more valuable than the TV viewer,” says Barbara Singer, vice president of advertiser insights and strategy at the network. Singer said that while the sports network’s TV audience is upscale, “our digital viewers tend to be even more upscale.” But the value goes beyond viewer profiles, Singer says, noting that even from an ROI standpoint there are certainly more narrowly defined client objectives that the digital audience achieves somewhat better than TV.

Indeed, live viewing is diminishing rapidly, according to a report issued by TiVo last month. Nearly two-thirds of the viewing on Web-connected TiVo units is now seen in playback mode or via on-demand video from Internet services such as Hulu and other online sites. The findings were based on the company’s analysis of second-by-second usage across 2 million TiVo devices. The analysis determined that only 38 percent of viewing is live across that TiVo universe.

“We all know the way consumers watch TV is quickly changing, especially when it comes to the growing consumption of Internet-delivered content,” says TiVo president and CEO Tom Rogers. “As people watch less live TV, the television industry is being challenged like never before to meet the needs of viewers. The reduction in time spent watching live TV has huge implications for commercial ad delivery, how consumers search and find programs, and the role of networks in the carriage of shows, all of which require the industry’s increased focus.”

While the TiVo data does reinforce the idea that many consumers enjoy the freedom of being their own program schedulers, that doesn’t mean that the video world is shifting to on-demand-all-the-time mode anytime soon, says John Spiropoulos, senior vice president for research at MediaVest, the Publicis Groupe media agency. TV shows have to be anchored to something, he argues, and what they’re anchored to now are TV networks, with their defined schedules and far-reaching promotional apparatuses — the primary way word gets out about programming.

“What drives TV viewing is patterned viewing,” asserts Spiropoulos. And today that is driven by networks that offer fixed daily schedules and heavy promotion. “With on-demand, that is completely gone, and there is no way to breed the pattern,” he says. “On-demand doesn’t work if you don’t know a show exists.” While the industry is working on strategies to address that, he believes it will be a long time before they are fully developed and implemented.

That said, tracking and communicating with consumers throughout the day as they flow seamlessly across the multiscreen landscape is essential to marketer success, says Spiropoulos. “As a marketer, if you’re not everywhere consumers are who might be interested in your product, then you are failing. You have to be there and be there now.”

And in a fragmented landscape, scattershot marketing doesn’t cut it, he says. Not only is it wasteful, it’s risky, he adds. “It’s a disservice if you’re bombarding consumers with messages who aren’t interested in your product.” In the digital era, he says, in addition to integration strategies, “targeting becomes much more important.”

The networks are acutely aware of all of that. Singer notes that only a “very tiny minority” of clients don’t implement cross-platform advertising agreements with the network, while most have integration ad packages that embrace multiple platforms. For nearly two years now, the sports network has used a multiplatform research technique called ESPN XP, which is designed to help clients optimize their integration strategies by better understanding the network’s audiences and how they consume media and respond to commercial messages. The network first used it for the World Cup Soccer tournament in 2010 and then for the National Football League and college basketball telecasts. And Singer says the technique has been so beneficial that ESPN is working toward making it a more standard research approach for measuring the network’s content lineup.

In his presentation at the media conference in New York, Poltrack argued that any analyses of the future prospects of the networks have to take into consideration the entire ecosystem in which they exist, which includes program productions, numerous digital platforms, and other outlets. He noted that during premiere week this season, cbs.com attracted 7.5 million unique viewers, which was up 50 percent from the same week in 2010.

And ad completion rates for cbs.com and the broader aggregation of Web sites known as the CBS Audience Network, are “consistently high,” Poltrack says. In the second quarter of 2011, he notes, viewers of full online episodes stuck with the ads 96 percent of the time.

The CBS experience mirrors the performance of the CW Network, which began its so-called convergence strategy of selling integrated ad packages across TV and online (the latter with a load of spots equal to the broadcast run) two years ago. In that time, the CW has seen double-digit increases in the number of online series episodes streamed per week, with 92 percent of viewers watching the ads loaded into those episodes.

And research has also shown that the duplication in audience between broadcast and online is small — around 7 percent in 2010. As one source notes, “overnight TV ratings don’t come close to telling the whole story anymore.”

The CW has been at the forefront of integrated marketing efforts since 2006. One of its most recent efforts was unveiled in late January — the network developed an interactive game that ties client Kia, the Korean carmaker, to the network’s hit show Nikita. The game, called “Nikita: Code Breaker,” which features series star Shane West, enables fans to engage in missions, crack codes and ultimately discover top-secret government documents. The game offers new missions each Friday, the day the series airs.

The game’s missions showcase the Kia Optima’s graphics and technology, including utilizing its GPS coordinates to locate targets. The game will run for the duration of the series’ second season. There’s also a sweepstakes tied to the campaign that offers a chance to win a visit to the Nikita production set. Kia also sponsored the development of Nikita apps for the iPhone and iPad.

“Warner Bros. Television is always looking for ways to bring its fans more opportunities to engage with their favorite shows,” says Lisa Gregorian, chief marketing officer of Warner Bros. Television Group, a partner in and producer for the network. “And what better way to reward Nikita fans than to give them the chance to be armchair operatives and assist with missions?”

Earlier this season, the CW and Microsoft search engine Bing unveiled a multiprogram and multiscreen integrated marketing campaign called “TV to Bing About,” designed to dovetail with the network’s tagline “TV to Talk About.”

One of the ideas behind the campaign was to tap in to viewer interest that goes beyond watching programs as scheduled. The network produced 50 pieces of “behind the scenes” original content about CW shows. For example, interviews were conducted with Ringer stars Sarah Michelle Gellar and Ioan Gruffudd, and Hart of Dixie star Rachel Bilson and executive producers Josh Schwartz and Stephanie Savage. A roster of other CW stars and producers were also filmed talking about their programs. Other creative elements were interspersed within CW shows on-air, including lower-third search screens, logo bugs and teaser ads for the upcoming video vignettes.

The content aired during the season premieres of programs and as part of longer vignettes that appeared across Microsoft’s online channel lineup including msn.com, Wonderwall and Bing, as well as on cwtv.com and on the network’s Facebook fan page. It also lived on a custom Web site, cwtv.com/bing.

And other networks are tracking their audiences as they migrate across different platforms as well, and working closely with advertisers on integrated packages designed to enhance both reach and engagement.

Comcast’s NBC is a good example. While most of the headlines have focused on the company’s struggle to draw a primetime audience, the company boasts 100 million fans and followers of shows and talent across the NBCUniversal portfolio.

NBCU builds digital water cooler

John Shea, NBCU’s executive vice president and chief marketing officer of integrated media, likens today’s fan communities to the proverbial “water cooler” that people used to gather round at the office to talk about the previous night’s viewing. “It starts with good content,” he says. “In the integrated media space, our job is to hook advertisers and partnerships creatively into this array of programming that the consumer is devouring in a number of different ways.”

To illustrate, Shea cites a holiday campaign that his unit executed for the Nook Color e-reader. “The client wanted a way to make this reader feel very personal to our audiences, particularly in the female space,” he says. So the network produced a series of spots that were “very different,” depending on the network or platform and the audiences that they attract.

For WEtv, the network produced a spot featuring two of its stars, Melissa and Joan Rivers, who talked about downloading fashion magazines in a way that reflected the banter they engage in during their show, Joan & Melissa: Joan Knows Best?

On Web site iVillage, the site’s book-club editors recommended titles that visitors might want to send to friends as gifts. And a microsite was created where readers could go to do a deep dive into various features of the Nook Color.

The various extensions were anchored by 30-second spots that ran on the networks. The 30s, says Shea, anchor all the campaigns that the integrated media unit puts together for a client. “They do more of the heavy lifting.” But in a world where “consumers surround themselves with media content in a variety of different forms,” the extensions are essential. “It’s more about the fact that we have all of this new technology driving interest and engagement and awareness.”