Back when online video was new, it was rumored to kill the 30-second spot. Citing the benefits of a “lean-forward” audience, interactivity and targetability, industry experts predicted in-stream online video advertising to steal significant dollars from the traditional TV spend. Yet it still hasn’t made even a dent in the traditional linear TV budget. In fact, linear TV continues to dominate the video advertising space with $61 billion being spent on broadcast advertising in the U.S., compared to $2.2 billion in connected video.
Where has online video so far missed the mark? Most reasons aside, the major issue has been reach. Linear TV simply has more eyeballs for more hours than online video. But that’s beginning to change. Not because people are abandoning the comfort of their couch for the posture-fixing desk chair, but because we’re bringing more and more connected devices into the living room. Between Xbox 360s, Boxee Boxes, Vizio IP TVs and mobile devices, our entertainment channels within the living room are increasingly connected.
As the national audience shifts their attention toward the rapidly growing number of connected devices, we as advertisers should be prepared to change their perspective on what we currently think of as TV advertising. Instead of the static 30-second stories we’ve done our best to ignore, the coming future of TV advertising combines the reach of the current linear TV landscape with the interactivity, targeting and analytics we’ve come to expect from PC video advertising.
There are a few major opportunities we see connected video bringing to the living room in the near future:
1. Highly targeted advertising in a lean-back environment – Combine the same great targeting efficiencies that digital brings to the table with the massive reach offered by the living room forum.
2. Interactivity from the couch – The app-led environment of connected TVs affords advertisers the opportunity to go beyond passive viewing and actually interact with the content they’re watching. Advertising in this space will allow viewers to drive the new sports car, buy (and play) the new video game and investigate the latest changes in cancer treatment.
3. Efficiency in cross-media campaigns – Ad networks in the space are already building out landscapes of advertising opportunities that transfer views across several media. This ability allows advertisers to run sequences of messages and frequency requirements across several devices, including mobile, PC and TV.
4. Advanced analytics for TV – Rather than rely on GRPs and self-reported data in tracking studies, connected TV can build in metrics that know actual viewership, interaction rates and influence on behavior in other touchpoints.
While these are just a few opportunities, the changes in advertising will likely be drastic. What do you think? How else might connectivity change TV advertising?