The impact of connected TV on Advertising - the future is already here (part 4)

In part one we predicted the growth of new sources for TV content, part two focused on with how that content could be delivered in the not too distant future. Part three on how technology will influence the TV content viewing experience.  The last part focuses on how changes will impact TV media buying, where spot buyers will need to think more like online buyers and suggested actions.

1. The 30 second spot is not dead but use it wisely: The demise of the 30-second TVC will not happen any time soon but fewer advertisers will start their strategic marketing planning with a television advertisement in mind. Instead, they'll step back and begin with an engagement strategy that gets operationalised through a series of creative ideas that then get routed through different channels. The TVC will be increasingly designed to engage (entertain, inform, educate) consumers about products and less about building brand recall, favourability and awareness in that moment alone. They will try and entice people into deeper branded digital engagements that will stretch out the brand experiences beyond the clip. How this affects the concept of ‘campaigns’ and who leads the client engagement from an agency point of view will be very interesting to watch.

2. Be relevant - Huge premiums are still spent on advertising against the first airing of a TV show, in most cases just because that airing is most likely to get the largest audience. Increasingly it shouldn’t matter when viewers first watch a show. If it’s the first time you watch a show, that’s the first run to you, no matter how many times it has been broadcast. What matters in a crowded ad market is return on exposure or the sense of engagement that your TVC delivers. High numbers simply mean higher wasted opportunities to personalise, as awareness is good but engagement is better. Social signals need to be captured and feed back faster to the right people. The premium will be paid on shows that have a high engagement factor in them. Those TVC messages that triggered the most positive social buzz online should heavily influence the next planning decisions. It will allow feedback to the creative team to adjust the message to get the best engagement.

3. Be ready to launch TVC in real time: Being ready for digital participation in real-time will become the new imperative for marketers. They'll need to structure media teams around this as savvy brands will need to jump on the trending buzz to promote related products and services. Increasingly, consumers care most about items like what's trending in pop culture, what's about to become really important, and what music, entertainment, sports or celebrities they need to care about. All this typically breaks online in a matter of hours being ready to join the conversation will become invaluable.

4. Go early and go often, produce low cost quality TVC’s: The cost of quality TVC’s must start to plummet. US satellite operator DIRECTV has just launched its addressable advertising platform, following Sky’s lead in the UK. It could be that this trickle turns into a flood during 2012. If so, it could be driven by pressure from both larger brands adjusting their message frequently to capture the buzz but also smaller brands that in the past have been kept out of TV advertising by the high cost of the traditional spot ad.

5. Push for Product Placement: Its been the promise for a while now, and once you get smart TV apps, watch out for the ad skipping apps for one simple reason, TV ads are a terrible experience for a viewer. Catch-Up/ON Demand TV will increasingly mean fast forwarding, so product placement must get better. In the UK, OFCOM are already looking at relaxing the product placement rules and this combined with 24/7 interactivity will spur advertising innovation within content. The ultimate product placement ads would of course be adaptive product placement, where different viewers see different products. Think different lap top logos being displayed in offices based on geography and viewing audience.

6. Leverage your new buying power. Proliferation of Channels strengthens media buyer’s hands. While TV programming is limited by time and the number of TV networks, Internet TV provides the possibility of a near-infinite amount of content to choose from. Program producers will increasingly bypass the traditional distributor’s altogether and set up your own single issue channel and there’s no reason why these channels shouldn’t appear just for the 1-week or even 1 day runs, think the Epson Carnival channel. As a result media fragmentation issues similar to what the Internet is going through and what the magazines industry suffered previously will hit TV. Good news for media buyers and possibly good news for advertisers as his will allow media planners to force innovation into TV faster.

7. Use Smart TV and Set Top Boxes (STB) data to measure detailed TV viewing: This will be the big change its not just who watched what, its how many program choices did the viewer go through to select the one they watched, its what dident get watched, what was started and then abandoned, what was skipped, paused, rewound and all by the second. So forget the panel and the blunt average reading of the ratings. There will be an explosion of interest in collecting and analysing television set-top box (STB) data (also called “return path” data). As mature markets move to digital signals, set-top boxes or smart TV’s with built in STB will become the norm where precise second-by-second can be gathered from millions of households. This data can be combined with detailed airing logs for thousands of daily TVC’s to estimate second-by-second fluctuations in audience during TV commercials. These data also holds the promise of providing accurate measurement for much of the niche content that eludes current panel-based methods.

There will be scope for more refined targeting within a household and tuning the adverts on the basis of the content being watched in combination with the known product preferences for the household as a whole. But there will be greater opportunity for targeting with smaller screens such as tablets and smartphones because they usually have just one owner and therefore preferences can be narrowed down to a single individual. Targeting offers brands the opportunity to reduce wasted transmission to people not interested in their products, but also, crucially, promises to make people more willing to watch adverts and less likely to try to skip them.

In summary: Greater engagement will translate into an increased chance that the advert will lead to a sale. 2012 will bring opportunities for brands to participate in the conversation in a new, targeted way by understanding through detailed return path data the rhythms of people's behaviour during different programmes and the on-going theatre that is popular culture and celebrity buzz. The future is here.