Two Little Buttons Change TV Advertising

One of our own Rainmakers HQ Partners, Kolar Advertising and Marketing’s Carolyn Fisher, was quoted in the January 18th issue of the Austin Chronicle.  Kevin Brass authored another installment of his Media Watch series with: “Austin’s TV Time Bandits Worry Advertisers” highlighting how usage of digital video recorders (DVRs) is shaking the TV advertising industry’s foundations. 

When a TV viewer records shows for playback at a later time, the retail VALUE of that show’s advertising becomes subject in two fundamental ways:

First – WHEN the viewer pushes their “PLAY” button.  One of the cardinal rules of marketing is timing, so much advertising is time-sensitive.  Think of national holiday-related retail promotions or local events like conventions and auto dealer’s end-of-year inventory-clearance sales.  The viewer may not push “PLAY” for their recorded show until after the event’s over. 

Second – pushing their “FAST FORWARD” button.  Carolyn Fisher puts it well in the Chronicle article:

“Advertising industry research shows “70 to 80 percent of DVR users skip commercials,” said Carolyn Fisher, group media director of Austin-based Kolar Advertising & Marketing. “But they do see visuals while they’re doing that,” she said. “Do they register? Sure. But is it the same effect?””

According to Brass, Austin’s viewers are amongst the highest percentage of TV viewers in the nation who use DVRs: 31%…and like the rest of the nation…rising quickly.  2007 was the year those two little buttons were pushed enough to rip-apart the once-narrow margins of error the marketing industry depended upon to calculate the value of network broadcast in-show advertising.  In response to DVR-usage influence, the value of in-show commercials is being reduced, but by how much?  Because reports from Nielsen Media Research and the like don’t account for this (yet), commercials are competing again with in-show product placements and other methods previously considered “secondary” in multi-media campaigns. As one of those “Austin’s 31%”, three thoughts come to mind for the TV advertising industry:

Viewer Control: The TV industry has recognized THAT the Internet’s viewer control distribution model will umbrella TV programming (and therefore, its advertising), but WebTV and other failures illustrate they haven’t seemed to figure HOW best to leverage it.  The vision of marrying the mouse and the remote has been around for quite some time, but TV programming is finally seeing successful distribution models by Apple, NetFlix and others.  As “viewers” turn into “users”, on-screen selection guides will evolve into search engines, and the businesses of TV network programming and advertising will have to fundamentally change to appeal to an audience who’s steadily taking control.  The lingos of ad agencies and web-developers are already blending their respective terms like “interactive” and “dynamic”.  It’s no surprise Austin, San Francisco/San Jose and other tech-comfortable markets are leading the DVR-usage conversion…they did the same with the industries of online dating and classified ads (think Match/eHarmony and CraigsList.org).  Time Warner’s partnership with AOL was simply too far-sighted (remember, it’s about timing).  The national networks and broadcast distributors should take a hard look at Current Network (who’s distributing its programming in collaboration with its audience) and start re-prioritizing their resources.

Change-Up the Pitch: To borrow from baseball, both TV ad creators and broadcast distributors must start throwing change-ups instead of just fast-balls.  Broadcast distributors should randomize the collective duration that ads are delivered so the timing of anticipate the timing of their show’s return and must slow-down their fast-forward. Change-ups make the batter pay better attention.  Ad creators would do well to present big brand/logo and graphic visuals to imprint brand name awareness/messaging at 2-3 times normal speed (while fast-forwarding), perhaps even prompt the viewer to push the Play button early to watch something they’re interested in.

Don’t Restrict…Report: Rumors circulate about broadcasters and distributors pushing DVR manufacturers to remove the “Save Until I Erase” menu option and restrict the viewer to save their programs no more than 3 days, 7 days.  Not only would the withdrawal of recently-won access control spark rebellion (remember the Time Warner Cable/NFL Network battle?), but since the DVR manufacturers are ultimately more beholden to purchasers/users than they are to their partnerships with distributors, it won’t work.

The TV advertising industry as a whole would be served well, however, by the distributors and DVR manufacturers providing functionality that reports WHEN the viewer played their recorded show and HOW they fast-forwarded through what content.  Look what cookies, affiliate-marketing referral codes, and web-analytics do for Internet advertising, website design, and search-engine optimizers.  There would indeed be another venue to the privacy debate and DVR manufacturers would value-compete by adding “opt-out” privacy functionalities, but like Internet surfers who buy software to hide/erase their Internet activity, there’ll be few to trump the big picture.

Benjamin Gipson serves as co-owner and managing partner of Rainmakers HQ, LLC, a business development and consulting firm offering project management leadership, online tools and education, and effectiveness coaching.