Thursday, March 20, 2008

The Lie We All Buy

We have all been sold a lie, perpetuated by most everyone in the ad business. The lie is that people have to watch commercials to be able to keep getting free programming.

Many of you will say, “C’mon, that’s not a lie. People either have to watch ads or pay for the content. Everyone knows that.”

But, let’s examine.

Say you were watching TV last night in a non-DVR format. When the commercials came on, did you watch them all? Did you watch any? Or, did you surf over to another channel?

If you didn’t watch the ads that ran with the program that you were watching, did you say to yourself, “huh, better put some money aside to pay for that?”

Didn’t think so.

Which means somebody is lying to us.

The truth is that advertisers pay the networks whether you watch their ads or not. What they’re actually paying for you to watch is the program, not the ads. Program viewership is measurable on TV. Ad viewership is not. Sure, advertisers would like for you to hang around for the ads, but c’mon, who does that?

The networks know this. And yet, for some reason, the lie continues. Maybe they figure that if Washington can get away with tying together Iraq, terrorists and 9/11, heck, this should be easy.

ABC used the lie just recently defending why they made their pre-roll ads unskippable on VOD platforms “Everyone knows,” ABC said, “that if people don’t watch the ads then they’ll have to pay for the programming. So, viewers don’t mind that we made them unskippable.”

Is that so?

Three things, ABC. One, we do mind.

Two, the reason that you made the ads unskippable is because both you and the MSOs know that viewers do consistently skip pre-roll ads when given the option.

And three, which might be the most damaging point of all, on digital platforms, advertisers will be privy to this type of information. Which means they’ll know exactly how poorly their advertising is working.

It’s difficult to look at data that says that people aren’t watching your ads and still cough up the millions of dollars that networks are asking advertisers to pay to run those ads. Makes the old sphincter muscles tighten up just a wee bit, doesn’t it?

Networks didn’t have this problem on analog platforms. Oh, sure, everyone knew that most people weren’t watching the commercials. But advertisers never had the data to back it up. And because denial is such a wonderful thing, advertisers simply bought into the fantasy that program ratings and commercial ratings were one and the same.

Welcome to the Digital Age of Reality.

‘Course, can’t blame the networks really. It is survival mode time. Can’t afford to lose any more advertising dollars. Instead of admitting to what they know is the truth, better to disable the fast-forward button so that the truth can’t get out.

“Wow, look at that,” they can now say. “Eighty percent view rates.” Indeed.

Advertisers, in the past, have only paid for the chance to expose their messages to viewers, nothing more, nothing less. Even if the networks allow viewers to fast-forward through the commercials, that exposure opportunity still exists.

What’s more, allowing the viewers to do so would actually give the advertiser four data points that they aren’t getting now.

1. The acceptability of the message and format.
2. The quality of the creative
3. The receptivity of the audience
4. The level of engagement with the message

You would think that advertisers would be the ones to say to the networks, let viewers fast-forward if they want. After all, by doing so, they would be able to learn the truth about what is and isn’t working on digital platforms, make changes, and be more effective in the future.

But instead, we buy the lie.

Question.

Why?

Monday, March 17, 2008

But Sir, What About Impressions?

I was in a conference room in downtown Manhattan. The CMO of a large package goods company was addressing his media agency, asking questions about branding on digital platforms.

His queries were pointed. His patience, short.

“The biggest benefit to online is accountability,” he said. “For us to dedicate branding dollars to online, branding needs to be accountable online.”

“Is it?” he asked.

It’s interesting to watch media agencies attempt to answer this question, if for no other reason than it’s similar to watching a teenager being grilled as to why they came in past curfew. While you know the answer will be creative, you also know it won’t be completely true.

As the pause became a bit more than pregnant, the CMO, perhaps realizing the quandary he had put them in, interjected.

“Branding and direct response are two very different things.
The objective of my branding budget is less about building sales
immediately and more about building sales over time. Would you agree?”

Nods all around from media agency.

“In other words,” the CMO continued, “branding is about building relationships first, sales second. Now, how are relationships built between people?”

As no one jumped in to answered his question, he did so himself.

“By spending time together.”

Nods all around from media agency.

“The only difference here is that one of those people is my brand.”

Nods all around from media agency.

“So if we can measure how long someone is engaged in my advertising,
then we can start to get a handle on how well my branding is working.”

Nodding stops from media agency.

“Let’s say we put twenty, different, thirty-second spots online. This means that consumers would have a possible 600 seconds to spend with my brand. Can you tell me how many of those 600 seconds I am able to engage them for?”

“Well, not exactly,” replied the head media honcho. “You see, we buy mostly pre-roll and in-stream online. Forced views, basically. Sure, we can measure whether viewers are there, but, to be quite honest, we don’t really know if they’re actually engaged in your messaging?”

“I see,” said the CMO. “So you’re saying there’s no way to measure how many seconds my video advertising is actually engaging people for.”

As heads nodded around the table, a voice at the far end, obviously much lower in rank as signified by table position alone, chimed in. “Well…”

Heads turned in astonishment as the voice continued.

“…if you let viewers initiate the interaction with the commercial, you know, let them start watching and stop watching when they want to, then you’d get a fairly accurate measurement as to how long they were engaged for.”

The CMO turned to Mr. Honcho. “Is that person right?”

“In theory. More or less. Yes,” was his reply.

Which led to an interesting test recommendation from the CMO. Abandon all pre-roll and other intrusive forms of video advertising online and buy only video formats that can be user-initiated.

“But sir,” one of the more senior buyers protested, “what about impressions?”

“What about them?” the CMO relied. “Impressions are about reach. You’re buying reach on broadcast. Broadband gives us the chance to build relationships rather than reach. Relationships, as we all just agreed, are built through time-spent together. Didn’t you just tell me that if the viewer initiates the interaction with my video messaging, then I can accurately measure their time-spent with my brand?”

“Um, yes, I believe we did,” said Mr. Honcho, looking down the table at the junior person on the end for confirmation.

“If so, then it seems that branding can be measured online,” said the CMO.

“Not meaning to be forward, but does this mean that we’ll be getting some of your branding budget for online efforts?” asked Mr. Honcho.

“Since it appears that branding is more accountable than we thought, yes,” replied the CMO.

With that, the meeting was adjourned. And as files were collected and people started heading for the door, I stopped to ask Mr. Honcho whom the junior person was who spoke up.

“Oh, you mean our new SVP of online video?” he answered.

“SVP? Really? Since when?”

He just smiled. “Gotta go,” he said. “Didn’t you hear? We just got some brand dollars to spend.”

Thursday, March 06, 2008

Video On Whose Demand?

At the 4A’s Media Conference and Trade Show in Orlando this week, one of the hot topics is if VOD will ever live up to its potential?

I would counter that it already has. No, not on your TV.

On your computer.

Demand a video online, and chances are, you can find it. This may not be true of movies, but it holds fairly true for most other forms of video.

According to Advertising Age, VOD has long been seen as a new hope for advertisers. With more consumers using ad-skipping DVRs, VOD is seen as something media outlets and marketer have more control over.

Something media outlets and marketers have more control over?

Oooops. Do you think that could be the problem?

Viewers like VOD because they get to be in control. Not because they get to be almost in control.

Media outlets and many marketers still feel that video should be offered according to their demands, not the demands of the viewers. Not surprisingly, the demands of the media outlets and marketers means forced viewing of advertising.

Not something that is going over particularly well these days.

The trade-off seems to be, at least according to ABC's recent announcement, that ABC will give viewers programs worth watching on VOD, but in return, they’re not going to let viewers fast-forward through any advertising.

In other words, ABC is declaring that it’s their way or the highway. I wonder if they've glanced out of their ivory towers at the highway recently?

Damn thing looks like a L.A. freeway during rush hour.

And it will keep getting more crowded until media outlets and marketers realize that the only way to regain control is to give the viewer complete control.

Come again.

Real control today lies in data. Advertisers pay well for data. The more control a media outlet gives the viewer, the more data they get about that viewer.

Which means, the more dollars they can charge for that viewer.

Take engagement, for an example.

Advertisers want to know if viewers engaged in their ad. The only way to truly measure engagement is to give the viewer the ability to disengage.

In other words, to give the viewer complete control.

Which means maybe the question shouldn’t be so much about whether or not VOD will ever live up to its potential.

Maybe the question should be, will media outlets and marketers ever live up to theirs?

Tuesday, March 04, 2008

Impressions + Initiation + Involvement = Engagment?

As you are probably well aware, there is an interesting battle raging for the best way to define engagement. Not surprisingly, the battle is heated, if for no other reason then that there is a fear that the result will lead to some making billions and others not.

After all, the way that engagement is defined will determine the way that engagement will be measured. And obviously, the one that gets to measure engagement gets to monetize it.

Hence, the battle.

What’s curious to me is how everyone seems to think that the introduction of engagement as a metric means the devaluing of some other metrics of measurement, i.e. impressions, clicks, etc.

But what if that isn’t the case? What if this mysterious metric of engagement is additive rather than subtractive? What if it’s a combination of things that advertisers are already paying for?

What if it can be defined in a way so that no one loses money?

What if it’s this: Impressions + Initiation + Involvement = Engagement.

Let’s see what this really means. An impression means that someone has been exposed to the message. As far as I can tell, one can’t engage with a message if they aren’t first exposed to it. So it seems fairly safe to say that some sort of exposure is a necessary first step to engagement.

If that’s the case, then media agencies, the current brokers of impressions and/or exposures are still in business.

Advertisers will still need media agencies to pay publishers and/or ad networks for aggregating as many relevant viewers as possible and giving them the opportunity to be exposed to the message.

So, no money lost there.

Let’s move on to initiation. Another word that could be substituted here is interaction. Whichever is preferred, initiation or interaction, it has to refer to an action that is driven by the viewer. If engagement is to be measured accurately, the user’s intent and action needs to be measured explicitly.

An impression offers implicit intent. Unfortunately, that's not good enough. But by having the user initiate the interaction with the message, their intent becomes explicit. Once a viewer clicks-in, there is a definitive start point to engagement.

Those responsible for allowing viewers to initiate the play of a video asset are the different video players now populating the web, as well as different video technology companies like VideoEgg.

Should they be paid for offering advertisers the ability to measure when engagement starts (and stops, for that matter)? You would think so, wouldn’t you? After all, if engagement doesn’t start, then it really hasn’t happened, has it?

But what if the viewer clicks-in and clicks-out immediately? In other words, stays for only a second. Is this still considered engagement?

Well, yes. But it’s a really short engagement. Especially if the spot they clicked out of was sixty or more seconds long. Which is why involvement, or time-spent with the message, seems like the third leg of this three-legged engagement stool.

One could almost say that time-spent is a measure of the quality of engagement.

Interestingly enough, how involving a commercial turns out to be is the responsibility of the creative agency. Should a creative agency be paid more if they create more involvement rather than less?

There are those that would argue, yes. And, for good reason. Since there are no time restraints on user-initiated messaging, a commercial should be as long as it takes to communicate the message. Which means, if not watched to completion, then the message obviously wasn’t communicated.

If agencies do their job well, they should be paid well. If not, no. By measuring time-spent with the commercial message, advertisers will have an accurate measure as to how well their agencies are doing their jobs.

What this all means is that instead of someone losing money, everyone still makes money. Presuming, of course, they are good at what they do.

But are all three parts really necessary? Perhaps the best way to find out is to ask yourself if engagement would still occur if you took one of the elements away.

It wouldn't, would it?

Of course, some will insist on arguing that what is missing is a click for more information or, to buy. But, isn't it true that one could be engaged in a message and not want to buy right at that moment?

Some, in fact, say that’s the definition of branding.

But, let's not go there.

Arguing about one definition is enough for one day.