TiVo Offers Subscriptions to Branded Content

Traditional TV viewing offers viewers no control over what ads they see. When viewed using a system like TiVo’s however, users gain control over whether to view ads at all. TiVo’s answer to frustrated advertisers is Product Watch, an offering that lets users choose which branded content they’d like to see.

In the same way TiVo users can search for TV programs and automatically add shows to their “Now Playing” list, Product Watch allows users to search for advertiser brand names and get branded video content delivered automatically to their lists. Although TiVo has offered advertisers the ability to send on-demand advertising messages to users for the past three or four years, this is the first time those messages will be listed where TiVo users are bound to visit most, the “Now Playing” list of all the shows they’ve recorded.

To find advertiser content that interests them, viewers can sift through five brand categories: Automotive, Entertainment, Financial, Lifestyles, and Travel and Leisure. When users “subscribe” to specific brands, up to five branded programs will be delivered, a new one arriving as a replacement for each that’s been watched. “One of the things that intrigues me is the ability to actually subscribe to a brand,” commented Robert Aksman, director of creative development at ITV agency BrightLine Partners.

But will viewers opt to request content created for advertising purposes? “If you were in the mindset to look at a certain product or item, then the answer is ‘yes,’ ” affirmed Jen Soch, VP, associate director of advanced television at Mediavest. Two of the media agency’s advertiser clients, Kraft and gaming firm Activision, are using the new TiVo format.

According to the April 2006 JupiterResearch report “The DVR Dilemma,” 53 percent of overall DVR households skip ads, and 20 percent of all U.S. TV households will be using a DVR this year. Ten percent of TiVo’s 4.4 million users opt to view branded programming on the service, according to TiVo VP, National Ad Sales Davina Kent.

“If it’s something that the consumer wants to watch and compelling…that’s the way to get consumers engaged, not to turn them off,” said Kagan Research Senior Analyst Derek Baine.

“I don’t think this is the place for traditional commercials that you see day in and day out,” suggested Soch. “I would not call this advertising; I would very much call it product information.” She envisions entertainment programs or product previews such as the ones Mediavest is running to present new Activision games.

According to TiVo’s Kent, this represents the first time such ads have been targeted only to users who choose to receive messages from particular brands. In the past, on-demand ads were sent to all TiVo users. “This is the first targeted product we’re offering,” explained Kent. “We’re giving viewers the opportunity to request different advertisements that are relevant to them and allowing advertisers to reach in-market consumers.”

Seventy advertisers including General Motors, Kraft Foods, Lending Tree, Remax, Sony Pictures and Tourism Australia have signed on to run 1- to 60-minute-long content pieces like product demonstrations or entertainment programs for 100 brands. TiVo has partnered with media agencies including BrightLine Partners, Cmedia, Interpublic Group, MindShare, Starcom MediaVest Group, OMD and The Richards Group to help get advertisers on board.

“This really opened up the opportunity for us to work with other categories we haven’t had traction with in the past,” added Kent, naming insurance, finance and travel advertisers as new markets TiVo is reaching through Product Watch.

Whether or not BrightLine develops more content beyond the one program it’s created for Axe and the six or seven developed for Reebok “depends on how the test goes,” and how well TiVo promotes the service to its users, said Aksman. Much of the two to four minute programs BrightLine developed were spawned from repurposed content, including celebrity interviews already featured on Reebok’s Web site.

BrightLine, as well as other agencies and advertisers involved in the initial launch don’t have much to lose since their first month of running content through the service is free. After that point, advertisers will be charged a setup fee and, unlike standard TV ad buys, will be charged per video download. Opined Mediavest’s Soch, “We need to look at this differently than we do traditional TV models. [Pay per download] might be a form of measurement.”

Offering a free month of ad messaging and a more cost-efficient payment model also doesn’t hurt when it comes to placating advertisers who aren’t especially thrilled with TiVo’s ad-skipping capabilities.

In the next Product Watch phase, users will be able to request more information from advertisers who will pay on a cost-per-lead basis.

Enid Burns contributed to this story.

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