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Interactivity, targeting and on demand platforms have contributed to the growing complexity of the TV advertising landscape. Although new revenue streams have been created, tapping into these requires broadcasters to invest time and money. Digital Broadcast investigates.
Branded content, series sponsorship, product placement, call to action, interactivity, targeted advertising… the list of options for advertisers is growing all the time. Broadcasters that rely on advertising are now being asked to provide a lot more for their clients than a prominent 30 second ad spot.
“The handling of ad sales became much more complex,” says Dr. Siamak Tadjiky, vice president broadcast management systems, S4M. “This is due to several factors. For example, nowadays there are many competing platforms growing in importance. Given the current economic situation, broadcasters are forced to make as much money as possible out of the available air time. All of this makes the handling of ad sales more challenging than it was a decade before,” adds Tadjiky.
This added complexity brings with it the need for new skills and technology to enable broadcasters to provide the new opportunities that advertisers are demanding.
“On one hand, with the advanced technology available today, it is much easier to guide the audience than it was compared to ten years ago,” claims Saad Mouneimne, VP Middle East & Asia, never.no. “At the same time, ad sales that were traditionally destined for the broadcaster are now being divided among other platforms. Now broadcasters have to attract both the advertisers and the consumer by offering top-notch, effective technology. Today, most people are connected in some shape or form during a large part of their day, which creates huge potential to cleverly engage these users, but it is far more complicated.”
Several developments have enabled these new technologies to emerge. The popularity of SMS messages has done much in terms of allowing viewers to sign-up to a campaign but it is two-way communication, regardless of the infrastructure underlying it, that has had the biggest effect on the inventory available to those looking to spend their ad dollars.
“Yes, the possibility to interact through a simple SMS response to an ad is very effective. Feedback in return for free samples gets viewers involved and allows advertisers to target these potential customers directly,” says Mouneimne.
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“Two-way communication between consumers and advertisers is now more tailored to individual requirements. This trend will continue to spread to the Middle East, thanks to the technology now widely available. Broadcasters can integrate interactivity into their routine advertising schemes. Interactivity is key in regions with large cultural diversity, allowing advertisers to better target the consumer’s specific needs.”
With budgets for technology infrastructure suffering as a result of the downturn, any investment broadcasters make will be expected to offer fast and attractive rates of return. With spot advertising being the mainstay for FTA channels for so long, technical heads have to be sure that the outlay will recover its own cost.
“Broadcasters are convinced it’s worth it,” says Jeff Tyre, director of product marketing, RGB Networks. “Having said that, they’re being very deliberate in rolling out advanced advertising applications and taking their time to get it right the first time.
“From an equipment standpoint, there’s also a desire to keep the number of components down to keep both costs and complexity manageable. As a result ‘all-in-one’ products – which combine ad splicing, overlay and other video processing applications – are seen as ideal for reducing the cost and simplifying the implementation of advanced advertising techniques. Additional components such as advertising servers and character generators are required, but broadcasters and pay TV operators typically have them already,” says Tyre.
S4M’s Tadjiky says that the needs of advertisers will vary from campaign to campaign and the infrastructure that the broadcasters invest in should reflect this.
“A very important issue is the provision for even more flexibility. Customers want to be able to act independently. They want to develop applications or let third party companies do so, and they want to customise sales systems themselves,” something he says S4M looks to address.
In addition to the technology required to support targeted and interactive advertising, there is also an increased demand for accurate data on which this targeting can be accurately – and usefully – based on.
“Up until now the response and the measurement of the effectiveness of an ad campaign has been done through panel-based measurement,” says Paul Haddad, VP and general manager of Media Data and Advertising Solutions (MDAS) at video and data management services provider, Concurrent. “In the US, these samples are typically 30,000-40,000 households for a population of 300 million. The results are by no means anywhere close to the reality, but it is the best effort today in the industry.
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