NEW ORLEANS—The cable industry has an enormous opportunity to change the face of TV advertising by serving up more relevant, interactive and measurable ads to viewers—but, as panelists here at the Cable Show noted, it won’t be easy.
“From an individual operator perspective, we believe we’re done with the testing. Now we need to make it a business,” said Billy Farina, Cox Communications senior vice president of advertising sales, speaking on the panel “Upper Hand: Cable's Advanced Advertising Advantage.”
The traditional 30 second commercial “is starting to lose some of its star power,” Farina said.
“It’s still the only way to get a message out to the masses. But the end user wants a different experience with their television set… It will enable us to deliver a differentiated product, to let viewers interact with the television set in ways they were never able to before.”
On the other hand, “the urgency [behind advanced advertising] must be tempered with the reality that this is hard,” said John Collins, Time Warner Cable group VP of advanced advertising technologies.
The migration to a consolidated technical and business infrastructure for buying advanced advertising campaigns -- exemplified by the industry's Project Canoe initiative -- will happen through an iterative process, according to Collins.
“We don’t expect to have a marketable, national product within 3 to 6 months,” he said. “But we’ll see milestones.. and we’ll build on the tests.”
Another reality is that cable operators have many other projects vying for resources, said panel moderator Arthur Orduña, Advance/Newhouse Communications senior VP of policy and product.
“We have a hell of a lot on our plates. We have the triple play, soon to be the quadruple play,” Orduña said, also calling out the digital TV transition. “It’s going to be a challenge to make sure advanced advertising gets the attention and focus on it.”
The takeaway from Project Canoe, he added, is that it’s “a commitment from the industry, a recognition that it is hard.”
Brian Hunt, senior vice president of marketing and sales strategy for NBC Universal TV networks distribution, said he was encouraged by the investment cable is making in Project Canoe.
“We need that scale on the national network side,” Hunt said. “We’d really like to take advantage of that across a larger footprint.”
And cable has to come out of the gate with a solution that delivers on the promise, Comcast Spotlight president Charlie Thurston said: “There’s going to be pressure to get Canoe right” when it launches.
Ensuring subscriber privacy is one of the highest priorities in dealing with targeted and interactive ads, Farina said, noting that Cox often uses double or triple opt-in before sending personal information to an advertiser.
“I truly believe that under the right circumstance the viewer would prefer to have marketers know them better,” he said. “It is of utmost importance that we protect the privacy of our subscribers. But there are some who will release that information because they are interested in that product.”
Collins said that from a consumer’s standpoint, interactive and addressable ads should feel like a natural enhancement to the TV experience. “So they don’t feel like they’re being manipulated and they think, ‘Oh, this is starting to feel creepy,’” he said.
As with any emerging business model, there’s not necessarily a consistent definition of what people mean by “advanced advertising,” a question that Orduña put to each of the panelists.
“Advanced advertising is really the ability to deliver the right message, to the right person, at the right time -- with the right kinds of features, so you’re enhancing the functionality and control a viewer has,” Farina said.
Collins quipped, “Advanced advertising is anything that isn’t hitting its budgets,” before adding that the cable industry really does have a significant opportunity to increase its ad revenue. “It’s definitely our game to win or lose.”
The ideal endgame, according to Farina, is to figure out a way to blend all the platforms people are using to consume content—and marry advertising campaigns to that content. But, he said, “it’s going to take us a while to get there.”