According to Tremor Video, an advertising services company, it makes sense for advertisers to test several TV commercials online before deciding on the ad or campaign it will actually use on TV.
To Tremor, online video offers the “world’s largest and almost instantaneous focus group.”
I think Tremor is right. But I also think they’re wrong. And where they’re wrong, they’re missing a huge financial opportunity.
The reason is this. Not only can online data tell an advertiser which commercial to run on TV, it can also tell them how much they should pay to have that commercial produced.
Digital data now tells advertisers how long viewers choose to watch a commercial for.
It’s hard to argue that a spot in which people choose to watch all the way through to completion is more valuable to the advertiser then a spot where people choose to opt out after five seconds.
If a commercial’s value can be ascertained, than shouldn’t the cost of the commercial be tied into the value delivered?
Tremor knows how long viewers choose to watch a spot for.
Currently they use this view duration data as a media metric. It's not. View Duration is a creative metric.
Advertisers can use this creative metric in a production-cost model called View Duration Compensation (VDC).
VDC allows advertisers to pay for commercial production based on how long viewers decide to watch the commercial for.
In other words, it directly ties the cost of the spot to the value delivered.
Instead of advertisers spending three times as much to create three different commercials to test against one another, they can save production dollars by paying only for what works.
Which is why I think Tremor is right about using online to test offline commercials.
I just disagree with their way of doing it.