Advanced Ads: The Roots Deepen

As a growing number of greenshoots demonstrate, advanced advertising is taking root in markets across the country, helping to prove the tremendous potential for ITV applications that will ride on the EBIF and tru2way platforms.

And these early successes aren’t limited to major markets. Lawrence, Kan.-based Sunflower Broadband has been working with local and national advertisers on advanced advertising solutions since 2006, when it staged one of the industry’s first trials of dynamic VOD insertion. (For more information on Sunflower, read “Dynamic VOD Ads Advance” in the May 2010 issue.) Since then, it has been working with dozens of local advertisers who use dynamic ads inserted into VOD and linear channels to telescope from the ad to long-form commercial content in the system’s VOD library. “These are people who are actually interested in your product,” said one advertiser. “You’re not trying to overwhelm them with a commercial.”

Added Patrick Knorr, Sunflower Broadband’s general manager, in a recent SeaChange case study: “It’s a per-impression model where people get to target, like they do with Google. com, and get accountability, like Google offers. Except it’s video, it’s right in front of the TV, and you know that people watched it.”

These reactions from the ad community also were reflected in the recent “addressable advertising” trial in Baltimore conducted by Comcast Spotlight and Starcom Mediavest Group. Overall, homes receiving addressable advertising tuned away 32-percent less than homes that received non-addressed advertising. The trial also demonstrated a 65-percent greater efficiency by sending ads only to relevant groupings the advertiser wanted to reach, based on the per-spot costs of addressable and non-addressable ads.

Several MSOs also have seen results from the “pre-EBIF” applications that allow digital video customers to telescope from ITV buttons appearing on linear channel content (including spot ads or contained within banner ads on interactive program guide pages) to advertiser-sponsored VOD assets. These examples include cable systems using video mosaics and telescoping assets supported by Rovi’s Passport Guide and Comcast’s video-rich navigation system.

“In one trial, homes receiving addressable ads tuned away 32% less than homes receiving non-addressable ads.”

In addition, cable operators and television networks are working together to monetize network programming being viewed on demand. By combining rapid VOD delivery systems with Nielsen’s C3 ratings system for measuring timeshifted content, the industry is demonstrating the value of network programming being viewed on demand.

And the importance of measuring time-shifted content continues to grow. Nielsen’s “Three Screen Report” found Americans spent nearly three hours per week watching time-shifted content in 4Q09, a 23-percent increase compared with 2008. In addition, recent 2010 TV viewing analysis from media agency RPA indicates C3 ratings are higher than live program ratings across all major demographic groups.

With organizations like Magna Research forecasting VOD-enabled households to expand from 47.3 million homes in 2009 to 65 million in 2015, the advertising community is taking notice. A recent survey conducted by Parks Associates found that more than half of the 30 percent of media planners or advertising buyers who purchased VOD advertising in 2009 already were planning to spend more on VOD ads this year. Moreover, some researchers are projecting VOD ad revenues to skyrocket to more than $542 million by 2012, up from a mere $12 million two years ago.

Estimates like these, fueled by the implementation of advanced advertising technology, are a great reason for cross-pollinating these early greenshoots in cable markets across the country.

Richard Buchanan (left) is vice president and general manager/Content Services, and Jon Shaver (right) is director/Content Development for the Comcast Media Center in Denver.