It's Not Your Grandfather's Convergence

The future snuck into my home recently.

There I was, surfing the menus of my Comcast digital cable, when I noticed the previously unfilled “channel 1” slot now held something called “ON DEMAND.” I dimly recalled a postcard making reference to VOD, but being a TV-technology skeptic, I figured it’d be something I’d see in 50 years or so. But there it was, staring me in the face. A quick click on the remote and I was in.

What I saw astounded me. Dozens of video “channels” with hundreds of programs I could watch any time I wanted to. Picking a show basically at random, I quickly realized I could stop, rewind, fast-forward, or save a program to view later.

My television viewing hasn’t been the same since.

Coincidentally, at the same time I got VOD in my home, TiVo announced it would start selling its audience measurement data. And after spending a couple of weeks with VOD (I don’t have a TiVo), I began to realize both of these developments, while seemingly unconnected, will have a huge impact on marketing as we move into the future.

Why? For the first time in history, advertisers have a way to measure actual, down-to-the-second TV viewing habits of literally millions of people. Forget the supposedly “statistically significant” ratings systems we’re used to for media buying. TiVo’s data and Comcast’s VOD usher in an age of real-time measurement.

Big changes are a-comin’.

Online advertising’s lessons can be applied directly to these new TV audience measurement services. From the beginning, online’s “accountability” was its big selling point… and became its curse. As we know (if we choose to acknowledge it), online buys are accountable from the minute they go live. We know how many people view it, where, and who’s clicking through. In some cases, we even know who sees and interacts with the ads, although this data is a lot harder to get to.

But the Internet’s a “common carrier,” with a lot of anonymity built directly into the code. Comcast and TiVo, as viewing conduits, have access to lots more data. Although media buyers and advertisers may salivate at the possibilities, it’s vital to look at some online advertising lessons to really understand what new interactive TV capabilities will mean in the future.

A few possibilities and predictions:

• Interactive TV is inevitable. Remember the early days of the Web, when clients (and colleagues) pooh-poohed the Internet? “Oh yeah,” they’d say, “It’s a fad. Only geeks are going to be into that.” One person even called the Internet “the CB radio of the ’90s.” Yeah. Right. Though the Internet hasn’t replaced other media to the extent early prognosticators thought, it has arrived very quickly. It reaches a huge percentage of the population. Technologies that give people choices and provide a better experience always win in the end, in one form or another. Although the personal video recorder (PVR) industry (to which TiVo and ReplayTV belong) have had some problems figuring out the right revenue models, you can be certain the technology isn’t going away.

  Have your doubts? Ask any TiVo owner what she thinks of the box. I guarantee you’ll get a major sales pitch. People love these things. Though it’s too early to tell with Comcast’s VOD, I predict once people start using it, they’ll fall in love with the convenience and selection. Besides, the service gives Comcast a leg up on satellite, something I’m sure figured heavily into the decision to develop the technology.

• The best marketing applications will come out of an understanding of what technology can do for people, not the technology itself. If you’re a current Comcast digital cable subscriber, you know how lame the “interactive” ads on the menus are. Clicking on one brings up a couple lines of text about the product or program advertised. Yawn. Once it combines those ads with on-demand video, it’ll have an incredible platform for delivering long-form video commercials with huge impact and great value to consumers. As for TiVo, though it’s experimented with long-form ads for BMW, New Line Cinema, and others, we haven’t yet scratched the surface of what could — and will — be done. The trick is to think like marketers, not technophiles.
• Measurement will rock our worlds. Look how online media’s measurability and targeting capabilities drove increasingly greater accountability. Once advertisers start to understand the potential, they inevitably will push for return on investment (ROI) and pay-for-performance models. These “accountable” forms of advertising have had major impact on publishers, agencies, and advertisers. When TV is as measurable as the Web (it will be, eventually), those pressures will cross over from the interactive side of the house to the broadcast side. Of course, direct response media has always been concerned with these things. They’ll be inevitable for all campaigns in the future.
• TV-Web “convergence” will mean something very different from what we expected. Face it. Video content is often far more compelling than what’s on much of the Web. As WebTV (and others) taught us, most people don’t want to watch the Web on TV. Makes sense. TVs really aren’t designed to do the job of a computer monitor. Does that mean “convergence” is dead? Nope. Just that content will be formatted to work the best way it can for the medium that displays it. We’re probably never going to surf the Web as we know it on our TVs. But there’s no doubt, as interactive TV technology evolves, using the Internet as infrastructure to funnel content is something we’ll be dealing with.
• Thinking outside of the proverbial box leads to the most effective innovations. TV folks generally think about marketing very differently than interactive folks do. As convergence occurs, more cross-pollination between the disciplines will lead to the most innovative ideas. Those who can’t deal with the new realities will be in trouble. Cross-media deals are pushing more cross-media thinking (as BMW so deftly demonstrated with the BMW Films campaign). But we’re a long way from maturity. Interactive TV will provide a way to easily push high-bandwidth content. The Web will continue to be a platform for experiential, interactive, information-rich content. Understanding how to work marketing messages that take advantage of the best capabilities of the media will be what works.

The future’s already here. We’d better figure out how to deal with it.