Five big things in media

We at Essential were having an internal discussion yesterday, over what we think the five major things to happen to media and communications will be over the next 12 months within the UK.

We all know that trends are notoriously difficult to discern and predict, since they are gradual rather than binary. Something like Digital Switchover might be the exception to the rule (when implemented correctly), but generally these things tend to sneak up on you.

Take the “Year of Mobile” as an example. Although Mary Meeker’s definition of a mainstream inflexion point as being 20% penetration (slide 8 of her latest trends report) would suggest 2010 is the Year of Mobile, I’ve noticed a large shift from people saying “Next year is the Year of Mobile” to “Last year was the Year of Mobile”.

So with that in mind, I spent five minutes thinking about various issues and came up with the following five trends

  • Location-based information gains traction among a niche – through tools such as Foursquare Layers
  • Narrowing distinction between broadcast and web-based offeringsYoutube Leanback, Project Canvas and multi-platform media players from the likes of BBC and Sky blur the boundaries between delivery mechanisms
  • Persistence of the blockbuster – despite media fragmentation, the social aspects of media and entertainment mean blockbusters are becoming even bigger to compensate – whether The Lost Symbol, Avatar, X Factor or Call of Duty Modern Warfare 2
  • Decline of critic proof content – This will be a gradual affair, but eventually rotten offerings will become more visible earlier due to social media. For instance, Sex & The City 2 did considerably worse at the box office than its predecessor
  • PR becoming more proactive – Twitterstorms are showing the dangers of trying to sweep things under the carpet. Ask Trafigura or BP

The big caveat is that this took me five minutes. It was therefore things from the top of my mind, and is probably a bit skewed towards recent announcements (Foursquare Layers and Youtube Leanback having been announced within the past week).

If I’d spent a bit longer, I’d have probably mentioned privacy/personal data – though reading Scott’s post earlier, it would seem that this isn’t such an issue for the general public.

As a quick thought exercise, I’m fairly satisfied with what I came up with, though they are so amorphous and vague that it might be difficult to say whether these trends have progressed at all. Nevertheless, I’ll revisit these in 12 months to see if any movement has been made

sk

Image credit: http://www.flickr.com/photos/barkbud/4165385634/

Five predictions on the future of TV

  1. Scheduled broadcast television will always constitute the majority of viewing
  2. The majority of viewing will always be passive
  3. Simultaneous social media activity will remain niche – it will primarily be a substitute for when people aren’t physically in the room with you
  4. A form of modified Pareto principle will persist (maybe not 80% of viewing on 20% of channels, but 60% of viewing on 5% of channels is believable)
  5. Watching TV on a “computer” will peak in a few years – it will be doubly squeezed by web enabled “television” and “mobile” devices

Any other predictions, or disagreement with the above?

sk

Links – 22nd February 2009

Some of the things I’ve read over the past week and would recommend:

  • A thought-provoking article in the Atlantic on the future of TV. It argues that TV’s USP is immediacy. While there are still cultural reference points via TV, scripted shows will increasingly see TV as just another distribution pattern. TV will therefore move to concentrate on news, current affairs, live reality shows and sport. This makes sense to me given my research – TV excels at events which are essentially DTR-proof, and the most popular shows online are dramas and comedies that can be viewed at leisure and shared/discussed asynchronously. However, I would argue that successful scripted shows still need TV as that anchor point for mainstream cultural crossover.
  • Ana Andjelic has a great post on our general failure to accurately predict the future. Not only does she argue that a lot of campaigns will fail, but also that our limited perspective means we will often follow the same patterns (potentially of failure)

sk

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Online video working with TV

Far from being a replacement to the traditional broadcast model, online video acts as a strong complement. Online video can be used to increase both reach and frequency, and the highly immersive environment offers multiple benefits.

2008 was a watershed year for online video. Ever faster and more reliable broadband connections are improving the online experience, with people now more likely to view the internet as a source of entertainment as well as information. This has helped fuel massive growth in video consumption across the year, both in long form and short form video.

As online video consumption becomes more common, we are seeing an increase in diversity among those viewing. Online video is no longer the sole preserve of tech-savvy students – two thirds of the online audience aged 55 or older have ever watched a video clip, while a third have ever watched a full length TV programme.

The distinction between clips and full length content is an important one to make, as each offers a different proposition. People watching TV shows online are catching up on content that they have missed. This is not replacing TV viewing – the online experience still has some way to go before it can match the widescreen, surround sound, HD offering of the living room. It is instead about taking control of the schedule. People catch-up on content they missed – either because they were away from their TV or watching something else. This suits some content better than others. Sport and reality entertainment are about the live experience; while the frequency and habitual nature of soaps are also best suited to TV. However, entertainment and drama flourish. Particularly shows that have a strong word of mouth following or ones that are aimed at an active segment difficult to pin down to a TV schedule. Ultimately, catch-up is about improving reach.

Short-form content, such as clips of outtakes or interviews, is about increasing engagement. Those that watch additional content online are likely to be the biggest fans of a TV show and heavily invested in the plot and characters. Short clips, with instant gratification, can be enjoyed multiple times and are very social, with people sharing links and commenting on them. This level of social recommendation adds further interest for the viewer.

Online video is a different platform to broadcast television, and thus the effects of advertising change. TV benefits from the powers of event broadcasting – shared experiences among masses of people at the same point in time, creating watercooler moments. Online viewing is just as social, but it is asynchronous. With closer proximity to the screen and people actively choosing to interact with certain content, levels of attention are generally high.

Preliminary lab tests indicate that advertising around short-form clips perform stronger than long-form content in traditional advertising metrics such as awareness, affinity and purchase propensity. Furthermore, advertising around identical long-form content performed stronger when broadcast online than when broadcast on TV. This doesn’t mean that online video is better than broadcast TV. It simply means it is different. It also highlights their complementary nature. TV excels at mass reach and watercooler moments; online video has a smaller but highly engaged audience eager to share content and information asynchronously. The next step involves quantifying these complementary benefits.

sk

Image credit: http://www.flickr.com/photos/lollyknit/

Links – 31st January 2009

As Des’ree once bemoaned, “Life, oh life, oh life, oh life”. A hectic few weeks are *fingers crossed* finally over. Rather than just watching the evening news and eating toast in that time, I also managed to read and bookmark some interesting things posted on the internet. Here is part 1 of a two-part collection of said stuff.

Insights

I’ve enjoyed the back and forth discussion regarding the nature and usefulness of insights. Richard Huntingdon used Simon Law’s presentation as a basis to provocatively state that insights do not come from the research department but from a combination of within (presumably not from those within the research department though), real life, academia and “weird shit”. This inspired several other posts.

Rory Sutherland sought to distinguish between an idea – creative – and insight – deduction.

Kevin McLean, a Qual researcher, felt that a little humility could have been used in the argument.

Will Humphrey offered a balanced summary, arguing that research findings should promote creativity and lateral thinking, but that planners should be more “ballsy” when pushing for decent research.

In terms of being ballsy and challenging, Dave Trott offers an inspiring story of changing a slender brief to a truly impactful one after going away to research the product

My own thoughts? Bad research, and bad researchers, exist. As do bad planners, creatives, account managers, product directors and so on. A project is more likely to succeed if each stakeholder is capable of implementing the necessary vision. This requires dialogue on each side – utilising specific skills and expertise to challenge, mould, amend and hone a brief. It is a researcher’s duty to provide a bespoke solution that will provide real, accurate, tangible outputs. If they don’t then they have failed. But other people in the chain have just as big an opportunity to succeed or fail.

Marketing and advertising

Rory Sutherland wonder if we can outsource media planning to the public through recommendation mechanisms within social media.

John Willshire followed up on that post with the notion that this removes control on how the message is propagated. He gives a great example of how such a scheme can easily be commoditised.

Ad Week looks at the rising relevance of shopper marketing in times of media fragmentation.

Faris Yakob uses a brilliant (fan-made) Thundercats trailer to illustrate the power and benefits of recombinant marketing

Iain Tait has a minor rant about the trend of using the themes of connection and collaboration within TV advertising

Graeme Wood remarks on ways in which the internet and social media can be used to deepen involvement in a television show

A NY Times article on ways in which the internet is being used to promote new novels

“Trust Me” – a new shot set at an advertising agency has launched in the US (NY Times). Within the show, real life brands and campaigns are placed. Personally, I think this is a great way to involve brands into entertainment in an organic way. However, in the UK product placement is currently illegal and so I wonder whether the show could ever be shown over here. Precedents are mixed e.g. we may get James Bond films with the “kerching” moments uncut but the Coca Cola drinks within American Idol are pixellated.

Rohit Bhargava on how advertisers can use consumers to help promote them

Ad Rants takes a look at Bob Garfield’s overview of the widget economy. I’m now locked out of the original article, so if anyone has access I would appreciate it if a copy could be sent my way 🙂

Claire Beale on Walker’s campaign to crowdsource a new flavour of crisp

Online video

Jim Louderback makes an excellent point in that, online, the third dimension of depth – or engagement – is far more important than reach and frequency

Mark Cuban believes online video is overhyped because the technology isn’t stable enough for mass simultaneous viewing. I would argue that this is what TV is for; online video is not TV and its benefits are different, but complementary.

And to highlight that difference, because the web is much more about discovery and experimentation, we see a huge drop off in viewing between episode 1 and episode 2 of a web series. Newteevee has a great overview of a recent report

Music

A Freakytrigger post shows that the number of new entries in the UK charts has dropped off a cliff in recent years. A negative effect of the long tail?

A very interesting Music Think Tank post on a pull music paradigm shift. There is some dissension in the comments but I found it fascinating

Tomorrow’s update will feature articles on social media, technology and the internet, and business and ideas

sk

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Could targeted ads work on TV?

I’ve been exploring the concept of targeted advertising on television. Loosely defined, it is the ability to purchase advertising space against a diverse array of groups that go beyond the traditional trading audiences.

This post accumulates the background information I’ve collected on the topic and speculation (mostly mine) on how theory may become reality.

Because it is such early days, I’d love to hear the thoughts of people (media side, client side, planners, buyers, researchers, interested parties) on the subject. Do you think it will work? What would you like to see and what would you like to avoid?

(Disclaimer: I have no involvement in targeted advertising – this is purely background research. This is preliminary work and any errors are fully attributable to myself).

1. Background

Traditionally, trading television advertising is a complicated beast, but Thinkbox have a gentle overview of the topic here. Essentially, there are several criteria that advertising can be bought against – channel, time of day, region (for analogue channels) and so on. Specific trading audiences can also be bought but unlike other criteria they can only be estimated.

To use a simple example, I may want to purchase 300 ratings against Women on ITV1. My advertising would be placed in shows that would be expected to deliver the required number of female viewers. However, only when BARB viewing figures become available do I know how many ratings were delivered. If ITV1 delivered more than 300 ratings that I am in debit; if they undelivered then I am in credit. The difference is carried over to the next advertising campaign I run.

However, as we all know, TV is changing. On-demand and IPTV, to give two examples, are changing the concept of what TV means.

The concept of targeted advertising emanates from this seachange. As it is still (largely) a concept, definitions are loose and the vague. Targets could theoretically be grouped according to demographics, lifestyle, behaviour, attitudes or a combination thereof. While an internet connection is the likeliest means of delivery, it is not the only option.

Whoever delivers effectively targeted advertising first will have a tremendous competitive advantage. The future is up for grabs.

2. The Players

In the UK, the platform providers are best positioned to introduce targeted advertising

In the US, Project Canoe is looking to develop consistent metrics which in theory could then lead onto targeted advertising

It is also theoretically possible for non-platform providers to offer targeted advertising. These could include

3. Strengths and weaknesses of targeted advertising

With the concept still fluid, it is difficult to come up with specific answers but broadly speaking: (NB: Several of these came from a Mediaweek piece by Barry Llewellyn of Packet Vision)

Strengths may include

  • Ability to target a more tightly defined audience – less wastage
  • Greater relevance for viewers
  • If ads are interactive, there will be greater accountability for direct response
  • Frequency of exposure can be capped
  • Advertising watersheds could be removed in adult-only homes (e.g. alcohol advertising in the afternoons)
  • May be more affordable for niche advertisers with small target audiences
  • Greater flexibility in pricing options – pay by impressions or acquisitions?

Weaknesses may include

  • The whole concept will succeed or fail on the quality of the information captured
  • Different platforms offering different options could hugely overcomplicate matters; can a consensus model emerge?
  • The current pricing model will be completely destroyed; with a near infinite number of targets a new system, such as Google style keyword auction bids, will need to be introduced and accepted
  • Similarly, how will total advertising audiences be audited? Everyone could be seeing different adverts around the same programmes. BARB would also need to be overhauled
  • No-compete clauses can severely inhibit the ability to target e.g. a beer brand may pay a premium to ensure it is the only beer brand in the spots they have identified as being key
  • Unpopular targets may get the same few ads on continual rotation e.g. will 65+ C2DE spinsters only get ads from the COI?
  • Serendipity of appealing to people outside of the perceived core audience is lost – do targeted ads have the same attraction to brand-based advertisers as direct response?

4. Potential methodologies

Largely speculation on my part, but potential ways to target ads include

  • Geographic/geodemographic information – the most basic targeting option. Homes can be targeted geographically through IP address or MOSAIC/ACORN postcode information. Geo targeting may only be attractive to local advertisers, but these could make up a long tail of demand. Alas, these methods are far from flawless. I’m a male 16-34 ABC1 (highly desirable, if I do say so myself) yet live on a council estate – would I ever see Leffe, Audi or Playstation 3 adverts?
  • Registration data – when homes purchase a new TV or set top box, they could be asked to register not only demographic information but also lifestyle/behavioural information (additional information would need to be opt-in). This gives a richer understanding of viewers beyond demographic profile, but there will be ambiguities over individual and household information and usage, and the data needs to be regularly refreshed in order to be useable (for instance, my cat may die and I may get a dog instead)
  • Return path behaviour – Interests can be inferred from the types of programmes that are watched, or the types of website that are visited. For instance, if I watch a lot of DIY shows, an ad for Ikea may be suitable. This is achievable but it is an art rather than a science. What if it is my girlfriend watching the DIY shows, not me. I could get all the DIY ads during football, and she wouldn’t get any during Hollyoaks. This type of targeting can be quite transparent and with an uncanny valley, is the method most likely to irritate.
  • Panel information – whether a panel like Skyview or an extension of BARB, a sample of viewers can be recruited, with advertising targeted around their behaviour. This could be extrapolated to all viewers through programme audience profiles or registration information. However, this would only effectively be targeting a small proportion of viewers, with the majority guesstimated. With around 35,000 Skyview homes representing over 4m households with Sky+, the level of accuracy may not be high enough.
  • Opt in system – give people the choice to submit information – either through an in-depth registration or regular surveys. By communicating the benefits, people may actively choose to receive targeted ads, creating value for everyone. This could be achievable, though the proportion of those opting in may be too small to be useful. With an opt-in, several additional steps could be taken to ensure accuracy e.g. a BARB style remote control (each viewer needs to “sign in” by pressing a button) could be introduced so advertisers know exactly which members of the household are watching.
  • Social profiles – Bringing social networking to TV – such as this BBC/Microsoft prototype – offer a lot of information that could be harvested. People like to communicate their favourites, and this could be utilised. And with users logged in to their profiles, advertisers will be sure of at least one viewer in the room. This could work – Joost is currently the number one contributor to Facebook Connect – but again, it would only be a limited dataset and a lack of take-up may prohibit effectiveness

5. Implementation

We should be seeing several prototypes and trials following in the wake of the Inuk experiment. Due to the difficulties of implementing targeted advertising within live broadcast, I believe targeted ads will initially concentrate on on-demand and interactive content (whether red button or the electronic programming guide).

There appears to be a first-mover advantage, and so the stakes are high. Virgin would seem the best placed to lead the way – the internet is already connected to the box and with subscription fees they are partially shielded from any effects to advertising revenues – but I wouldn’t rule out any of the other players leading the charge.

Indeed, the first implementation may not even be within advertising. What if I could let Sky know which sports I like and dislike, and then get a customised news ticker on Sky Sports News? I’d certainly opt into that.

6. Further thoughts

This is an early stage outline of how targeted ads appear from my perspective. I’m really keen to hear other people’s views on the subject. Do you think targeted ads will take off? What would you like to see? What problems do you envisage?

Any feedback would be greatly appreciated

sk

Image credits: http://www.flickr.com/photos/pbo31/ and http://www.flickr.com/photos/melilab/

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Why advertise around online video?

I was recently asked to summarise the reasons to advertise around online video. I came up with four broad factors:

1. User Experience

  • Users are actively choosing to watch a clip
  • Adverts generally can’t be fast-forwarded
  • Ads can be interactive
  • Ad breaks are shorter than TV and so spots have a greater chance of standing out
  • Online is a “lean forward” medium with viewers closer to the screen and in a more attentive state

2. The ways in which it can be bought

  • A specific number of impressions can be bought and capped
  • The variety of metrics it can be bought by (though this will vary by site)
  • It can be bought alongside display and other forms of advertising to maximise exposure

3. The way it complements TV

  • Audiences with TV and online are strongly positively correlated
  • TV and Online work together
  • Advertising within catch-up increases reach
  • Advertising within clips increases frequency and engagement among a show’s biggest advocates (and fans of shows tend to be more positive to the ads)

4. Effectiveness

What do people think? Any suggestions to add to this?

sk

Image credit: http://www.flickr.com/photos/warmnfuzzy/