Wednesday, May 14, 2008

TV is dead. Long live TV.


In early 2001 I gave a speech entitled "The Future of Advertising" at a chapter meeting of the American Marketing Association.  (I know, I know...even Nostradamus would have been embarrassed to use that title.)

I'm in the way-back machine because some recent headlines reminded me of something I talked about that day:  the advent of addressable TV advertising.  I spoke breathlessly about interactive TV (remember Wink?) and some emerging chatter about addressable TV.  My instincts may have been right but my timing was way off.

Seven years later that chatter about addressable TV advertising is now a full-fledged dialogue.  New companies such as Invidi Technologies can now provide cable operators with the tools to target specific commercials to specific viewers.  Industry initiatives such as Project Canoe, a consortium of cable operators, are working to create a universal model to deliver, price and measure addressable advertising.  The future is coming.  Any day now.

What's behind this recent momentum toward addressable TV advertising?

First, the moon and stars are finally aligning.  Like the Web, TV is now a digital medium.  Let that sink in for a moment and it becomes apparent that it is time to rethink its potential.  Combine its new digital delivery platform with the fact that viewership, while increasingly fragmented, is stable and large and we have a significant opportunity to reinvent TV advertising.

Second, the cable operators have a significant economic incentive to innovate.  They currently capture only $5 billion of the $70 billion marketers invest in TV advertising.

Third, and perhaps the most powerful driver of change, is pure fear.  And to cable operators fear is spelled g-o-o-g-l-e.  The folks who brought targeted advertising to the Web with AdWords are now exploring the potential to bring targeted buying and pricing to TV through a test with EchoStar's Dish Network.

Marketers and agencies should actively support these initiatives.  Addressable advertising will give us the ability to continue tapping TV's unmatched power to brand through sight, sound and motion with much greater precision and metrics.  Sounds like a win-win.


1 comment:

David Esrati said...

David- the addressable TV isn't a TV and it's here already: i-P-h-o-n-e, that's right, iPhone.
Not only is it the ultimate 1-1 relationship, where it can know your preferences in search, in who your friends are- but, it's also GPS aware.
TV is dead. IPTV is the answer- on demand, on target, with the ability to actually address your needs, wants and desires.
The question will be the balance between privacy and value of advertising "support" to pay for your programming.
Look at the NYT reader- with its small banner ad at the bottom of the screen- customize it to me, by geolocation- and only pay if I click through.
That's the future.