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Archive for May 23rd, 2008

Double the power of advertising

Posted by Mort Greenberg on May 23, 2008

Article Source: http://www.marketingweek.co.uk

Article Link: http://www.marketingweek.co.uk/cgi-bin/item.cgi?id=60890&d=259&h=263&f=3

22-May-08

Next year UK advertisers are expected to spend about £3.6bn on the internet, outstripping the £3.4bn forecast to be spent on TV advertising, according to figures out this week from WPP-owned GroupM.

The internet, dominated by search revenues, has also been making great strides in classified and display. Indeed, within display increasing amounts are being spent within TV broadcasters’ online propositions, such as pre and post-rolls and sponsored segments.

And, according to joint research unveiled by industry bodies Thinkbox and the Interactive Advertising Bureau (IAB) this month, those who focus on the “competition” between the media, rather than their complementary elements, could be missing a trick.

Using both TV and online advertising delivers an increase of up to 50% in positive brand perception and an increase of more than 50% in the likelihood of purchase. The study conducted by Q Media Research shows how using the two most powerful digital media together is significantly more effective for advertisers than using either in isolation.

The findings also reinforce the need to ensure creative synergy between TV and online advertising and have identified best practice for better effectiveness, which requires more than putting TV ads online.

The study marks the first time that the effectiveness of using TV and online in tandem has been examined in depth. The research sample was focused specifically on “digital consumers” – people who own a digital TV and use broadband internet, and are medium to heavy users of each. As a result of the study focusing on the most tech-savvy of the UK population – around 25% of its total – the results aim to provide an indication of how future media consumption and consumer behaviour may develop, rather than what is currently mainstream behaviour.

In terms of their precise media use, 64% of the sample said they sometimes watch TV while using the internet, and 48% stated they did this most days – enabling instant online response to TV ads.

The research comprised quantitative and qualitative stages to gain a holistic view of how both media work together in UK marketing campaigns. The quantitative stage used a demographically representative online sample of 3,000 respondents with digital TV and broadband internet access to gauge the effectiveness of TV and internet advertising combined and how this can be exploited by advertisers to greater effect.

The qualitative element of the research featured engagement diaries in ten households, an online discussion forum and in-home observation of how people use and engage with TV and online in a natural context. The research featured advertising from automotive, packaged goods and finance brand categories.

TV and online advertising have a clear influence on purchase and response in their own rights but are much more influential when advertisers exploit their individual strengths together.

The research found that TV is stronger at telling people about a new brand they haven’t heard of before (74%), sparking interest in a brand (74%), providing new information about a brand people are already aware of (72%) and persuading people to try a brand or product (59%). Online advertising can also have these effects but performs relatively better at helping people decide which brands are relevant (50%), causing a re-evaluation of a brand (41%) and giving enough information to make a purchase decision (41%).

The findings demonstrated that people have different motivations for watching TV and using the internet. Although there are overlaps in reasons for use, the internet is accessed primarily for finding information (75%) and communication (66%), while TV is mainly used for entertainment (80%) and relaxation (73%).

That said, the internet is increasingly becoming a destination for entertainment and relaxation with 56% of respondents saying that they sometimes use it for both of these reasons, most likely fuelled by faster, more reliable broadband and the increasing popularity of watching TV online. The internet becomes a destination for entertainment and relaxation particularly when it is used while watching TV.

The study showed how online is enabling people to watch more of the TV they enjoy. Two-thirds of those who took part in the research have watched television via online providers, primarily from TV broadcasters’ websites. The main reason for watching TV online is to catch up with broadcast TV programmes that have been missed (58%). It is clear that online TV is mainly a back-up to the broadcast schedule and the research showed no signs of the cannibalisation of broadcast TV that some have assumed; online use is not displacing TV viewing.

Other reasons for watching TV online include catching up on missed series (28%), watching previews or trailers (25%), catching up on programmes that have been recommended (23%) and watching highlights of a programme (21%).

The research illustrated the immediate take-up of broadcaster on-demand sites as well as high levels of experience of pre-roll advertising Interestingly, however, respondents were four times more likely to think of pre-roll ads as “TV advertising” rather than “online advertising”.

Importantly, it also found that consumers are now much more aware of the existence and role of TV and online advertising and what they can do with it for themselves. It was clear from the findings that they appreciate the complete package that TV and online, when used together, offers them. Good news for advertisers concerned with any supposed anti-advertising sentiment.

The Thinkbox/IAB research helps advertisers recognise and understand the greater impact they can have if they use both TV and online together. The whole is greater than the sum of the parts. TV benefits from the way online offers a means of expressing and exploiting the desires and motivation TV creates. In all the categories that were tested, the results were very positive for both “soft” brand measures and “hard” purchase intent scores.

David Brennan, Thinkbox research and strategy director, and Sorcha Proctor, IAB research manager, contributed to this week’s Trends Insight  

Posted in Ad Products, Brand Advertising, Marketplace Trends, Traditional to Online | Leave a Comment »

Dell-only ad agency names first CEO

Posted by Mort Greenberg on May 23, 2008

Article Source: http://news.cnet.com

Article Link: http://news.cnet.com/8301-10784_3-9948093-7.html?tag=blog.promos

May 20, 2008 7:25 AM PDT

Ad giant WPP Group has hired the first CEO for its Dell-only agency, which is taking over the work of about 800 firms that have been coordinating ads and marketing for the PC maker.

Torrence Boone, who is leaving his job as president of the Boston office for digital marketer Digitas, will eventually oversee about 1,000 employees at Project Da Vinci, the temporary name for the ad agency that’s been created to serve Dell. So far, the agency has hired about 500 employees.

Torrence Boone,
CEO, Project Da Vinci

(Credit: Business Wire)

Boone, who is 38, is set to start work in June out of the New York headquarters of Project Da Vinci.

“The opportunity to play a leadership role in the creation of a new agency, built-to-spec, with an ambition to redefine the client-agency relationship, comes along perhaps once in a lifetime,” Boone said Monday in a statement.

Before working for Digitas, Boone was vice president and general manager at interactive marketer Avenue A.

Last year, Dell signed a three-year, $4.5 billion contract with WPP to consolidate its ad and marketing efforts within one central agency. In addition to the New York headquarters, Project Da Vinci will have offices in Austin, Miami, and San Francisco, and will also work out of London, Sao Paulo, Singapore, and Beijing.

WPP signed a deal last week with Yahoo. Under the deal, three WPP subsidiaries–GroupM, 24/7 Real Media, and WPP Digital–will have access to Yahoo-served ad space and work closely with the Right Media ad exchange.

Posted in Ad Agencies, Ad Spending, Brand Advertising, Marketplace Trends | Leave a Comment »

Web Video Advertisers Want Their GRPs and Web Metrics, Too

Posted by Mort Greenberg on May 23, 2008

Article Source: http://www.clickz.com

Article Link: http://www.clickz.com/showPage.html?page=3629613

When Web video advertising was introduced, there was a lot of talk about TV advertisers requesting that it be sold the same way they were used to buying television: by GRPs, or Gross Ratings Points. Today, online video ad sellers are still up against demands for ads sold the traditional TV way. Yet those very same advertisers want their ads to be measured according to much newer Web metrics.

Most online video industry people don’t want their ad sales based on GRPs, but some advertisers still ask them to discuss their audiences according to that old TV ad framework. Media buyers want agencies and publishers to speak the language they’re accustomed to.

“I do hear GRPs a lot,” said Mike Henry, SVP of advertising sales at Internet TV service Veoh, during this week’s Streaming Media East conference in New York.

“There’s a need for us to be able to [discuss online video ads] in their lingo,” said Carat Media Supervisor Garrett Albanese, who also continues to hear advertisers toss around the term. “It’s not the end all, be all, but they want us to be able to show that.”

While online video ad sellers have long pushed against the use of GRPs, some Web measurement people don’t appreciate it either. Nielsen Online Media Analytics VP Jon Gibs put it bluntly. “I hate the idea of GRPs online; I really despise it,” he said, noting he’s “fighting tooth and nail” against some who want Nielsen Online to measure Web video in GRPs.

GRPs measure reach and frequency of television advertising, and are used to estimate the exposure of TV spots.

While requests for online video ads to be sold in the traditional TV way haven’t stopped, some GRP holdouts demand their campaigns be held to higher Web measurement standards. A portion of them, for instance, want to use direct response metrics such as those based on clicks or conversions. To video publishers, this represents a disconnect; in a way, the TV traditionalists want to have their cake and eat it, too. Online video ad sellers are particularly reluctant to have their ads measured by direct response metrics because they often see video as a branding vehicle.

Christine Cook, SVP Digital Sales at Martha Stewart Living Omnimedia, lamented the use of direct response metrics for gauging results of video ads, particularly those running in highly-branded content such as what’s shown on MarthaStewart.com. If the goal of a campaign is for people to visit a store, advertisers sometimes believe their Web video effort failed if it didn’t hit their conversion or click-through numbers.

“We’re still stuck on how many people found the store,” she said. “If we don’t have enough people coming to the store… [advertisers] say it didn’t work.” Ads in other media such as film trailers shown in theaters aren’t held to such stringent standards, she contended.

Web video ad sellers don’t like the idea of their ads being commodified by GRP measures because they believe in the branding capabilities of their content. “It puts you in a position of being monetized that I think a lot of people aren’t comfortable with,” said Nielsen Online’s Gibs.

He explained that when considering GRPs, TV advertisers take into account a certain amount of waste, or ad exposures that may not have been seen by targeted viewers. Applying that method to the Web, he said, is problematic because television campaigns typically have more wasted impressions than Web campaigns. Thus, the number or equation an ad buyer should apply to account for waste ought to be different for online video than it is for TV.

Another challenge to Web-basd GRPs is audience duplication. When running ads on both Web and TV, “You can’t un-duplicate the audiences,” said Peter Naylor, SVP Digital Media Sales, NBC Universal.

Naylor also suggested TV media buyers often want online video buys to come out of their television budgets rather than digital budgets, since they perceive the online components to be extensions of their TV buys. So, naturally they demand TV-related buying methods. “There’s still a lot of friction,” in terms of whose budget the Web video ad buy is coming from, he observed.

This is not a one-way street though. Carat’s Albanese said digital advertising also influences television advertising. Today, advertisers want more information about their TV campaigns to better gauge outcome, and he thinks this is partially inspired by online advertising.

“The Web will always be the most accountable medium, but they’re becoming more accountable, too,” he said.

Posted in Uncategorized | Leave a Comment »

Web video advertising: awaiting the boom

Posted by Mort Greenberg on May 23, 2008

Article Source: http://www.reuters.com

Ariticle Link: http://www.reuters.com/article/reutersEdge/idUSN2249916320080522

Thu May 22, 2008 7:44pm EDT

By Kenneth Li and Paul Thomasch – Analysis

NEW YORK (Reuters) – Any conversation about hot spots in advertising inevitably swings toward online video, with marketers anxious to reach a huge audience watching their favorite TV show or homemade videos on the Web.

Why, then, did U.S. marketers spend just $471 million on online video advertising last year, according to Forrester, representing only 2.6 percent of all interactive marketing?

Executives attending the Reuters Global Technology, Media and Telecoms Summit this week cite inexperienced creative and sales staff and fear of the unknown among the roadblocks for online video advertising.

They widely agreed, however, that it was only a matter of time before it takes off.

“You have some terrible ads which we could be ashamed of and you have some great ads,” Publicis (PUBP.PA: Quote, Profile, Research) Chairman and Chief Executive Maurice Levy said.

“What you will see with online advertising and video advertising is what you have seen with print and TV advertising, which is a progressive improvement,” he added.

In an industry conditioned to lure consumers with 30-second and 60-second television spots, creating effective Internet spots has been difficult.

“Things can only grow as fast as TV advertisers will make them grow — and honestly these are guys who want to move very cautiously because they have historically held all the cards in the ad world,” Forrester analyst James McQuivey said.

Selling video ads is another big issue.

“I don’t think publishers are really clear on how to sell it yet or what formats work best for consumers and a lot of the ad serving technology, tracking and campaign management technology is still pretty immature,” said Saul Klein, partner at Europe’s top Internet venture capital firm, Index Ventures.

“Even the bigger players in the market, Google (GOOG.O: Quote, Profile, Research) with DoubleClick, etcetera, don’t really have a robust answer on how video is going to work,” he added.

TOO RISKY TO AVOID

Still, Forrester expects online video advertising spending to roughly double this year to $989 million, then roughly double again to $1.86 billion in 2009. It puts the compound annual growth rate at 72 percent from 2007-2012, far exceeding any other type of interactive marketing growth.

“In terms of the growth rates, the online advertising in terms of video I think has more than tripled in the last 24 months,” said Jason Kilar, chief executive of Hulu, a video website owned by Rupert Murdoch’s News Corp (NWSa.N: Quote, Profile, Research) and General Electric Co’s (GE.N: Quote, Profile, Research) NBC Universal.

“You’re working off of a small base, but if you can keep rates anywhere near that for a number of years, you’re looking at a big industry, and certainly the projections suggest that,” he said.

Whether more money will go toward ads with full-length TV shows like “Saturday Night Live,” professionally created clips or user-submitted video, which to date has generated the lion’s share of viewing on video sites, remains up for debate.

For now, 70 percent to 80 percent of ad activity has centralized around traditional TV shorts on the Web, although that only accounts for 10 percent of viewing, Fred McIntyre, senior vice president at AOL Video, said in an interview.

“Advertisers will tell you that there’s not enough usage happening there, and if we just get more people to watch TV on the Internet, it’ll work,” McIntyre said.

But bigger growth could come from the middle tier of video types — professionally produced clips tailored for Web viewing. McIntyre said the format does a better job of attracting higher usage and engagement with viewers than TV shows ported to the Internet.

WPP Group Plc (WPP.L: Quote, Profile, Research) Chief Executive Martin Sorrell predicted advertising for all three would take hold along the same timeline.

He dismissed those who say video advertising may simply not be suited for the Internet, calling them “moaning minnies.” He said advertisers must be willing to experiment because it was too risky to bet against it being a success.

“It may be the Beatles, it may not be the Beatles,” he said. “But we have to invest in some of these areas to understand what’s going on.”

(For summit blog: summitnotebook.reuters.com/)

(Additional reporting by Kate Holton in London and Nicola Leske in Paris; Editing by Braden Reddall)

Posted in Ad Products, Marketplace Trends, Online Video News, Television & Video | Leave a Comment »