EventReview

New York, NY
May 20, 2002

[itvt] Issue 4.50 5/27/02

By Liam O’Malley for [itvt]

The New York New Media Association's Interactive TV Special Interest Group (SIG) sponsored the "iTV: Addressable Advertising Realities" conference, May 20th, at Tech Space in Manhattan.

The conference was hosted and moderated by Art Cohen, SVP of advertising and e-Commerce at ACTV and chairman of the Interactive TV Alliance. Mr. Cohen began the event by noting that $60 billion is spent annually on television advertising. The theme for the evening's discussion was how ITV could make television advertising a better experience for both the advertiser and consumer - particularly by making it more accountable.

On that note, Cohen introduced Leonard Ellis, EVP of enterprise strategy at Wunderman, a direct marketing firm. Mr. Ellis noted that the medium a direct marketer uses - television, print, the Web, - does not matter to him as much as meeting the client's business objectives. Direct marketing, he said, is successful when 2 objectives are met: 1) qualified leads are generated; and 2) the marketer and client are able to “listen” to the data they have collected and thus optimize the ROI during the course of the campaign (through tweaking the offer, the creative, etc.). Advertising using ITV technologies, he pointed out, will allow for near real-time collection and analysis of responses. Mr. Ellis illustrated this by calling on Seth Haberman, president of Visible World, who was in the audience. Visible World recently ran a targeted ad campaign for 1-800-FLOWERS in the Los Angeles area. Using Adlink technology, the company dynamically generated 93 versions of an ad, optimizing the creative, changing offer codes, price points, etc., and targeted these according to zip code (see [itvt] Issue 4.xx for an account of Visible World’s new technology to manage dynamically generated commercials based on demographic data). Mr. Ellis was curious as to how the results were affected by the greater precision used in targeting the ads - unfortunately, the promotion was for Mother's Day and so the data has not yet been analyzed.

The next speaker was Motorola's Dale Papovitch, director of business development for Digital Consumer Gateways. Her presentation , “Digital Cable Today and Tomorrow,” while not focused strictly on the topic of addressable advertising, was nevertheless a good update on the status of digital cable. She noted that the “future of ITV is the future of digital cable.” In her view, cable will eventually be all digital. The new systems are for the most part complete, and now the challenge is to retain existing customers and attract new ones. The advantages cable offers over its competitors, she observed, are bandwidth and its 2-way capability. What are the roadblocks to the success of digital cable? In terms of technology, none. Big issues that do remain include Digital Rights Management and the availability of programming. But perhaps the largest hurdle to overcome is making the consumer aware of the benefits and advantages of digital cable. As Ms. Papovitch noted, it is very difficult to explain the benefits of a DVR/PVR to someone - but once you use one you can't live without it. Cable's challenge is to make digital cable indispensable.

Next up was Jed Meyer, SVP of Nielsen Media Research's Interactive Services. Nielsen is currently working on a number of projects involving ITV. One project, in partnership with Wink, matches Wink data with Nielsen data to identify Wink households’ viewing and interactive behavior - and attempts to answer such questions as whether Wink users watch more TV. Another project currently underway, in partnership with Gemstar-TV Guide, is focused on investigating whether data collected from EPG usage may be used as audience research. Nielsen is also engaged in ongoing negotiations with set-top box manufacturers, Motorola and Scientific Atlanta, to study how Nielsen may use clickstream data. Nielsen also conducted a PC/TV usage study from April through September 2001. Three observations were made: Internet households are not necessarily light TV viewers, 2) a “heavy media consumer” is emerging, and 3) 66% of the households surveyed engage in simultaneous usage (Internet and TV). All in all, it was clear that Nielsen is determined to remain the leader in television audience research, and sees an understanding of ITV technologies as essential to doing so.

Mike Gannon, VP of advertising sales at Wink, began by announcing that Wink is now in 5 million homes and has contractual agreements to be in 10 million by the end of the 4th quarter. Mr. Gannon gave a brief overview of Wink's technology and its benefits to advertisers. Most interesting are the response rates Wink ads are getting: 75% for contests, 62% for samples, 35% for brochures, and 65% for research/polls. An example Mr. Gannon showed was an ad for Imodium Advanced Caplets, which generated 15,000 leads for Johnson & Johnson. Mr. Ellis interjected at this point that this was not only a “nice number” - but that the respondents were “knowable”: i.e. Johnson & Johnson now knows who is responding. Mr. Gannon noted that networks had begun touting Wink capabilities in this year's upfront presentations (a good sign for the industry) and that there were now about 3000 hours a week of Wink-enhanced programming on the schedule.

A question-and-answer session followed the presentations. Mr. Ellis bet that in the future all advertising would become response-enabled. Mr. Gannon hailed as a positive development Liberty Media’s acquisition of OpenTV and ACTV, stating that the ITV industry is “off life support.” Mr. Cohen stressed ITV's capability to directly address advertising, noting that it is not enough to interact with the audience, but that you also must know who to interact with.

The New York New Media Association’s ITV SIG will be holding additional events this summer; for more information see http://www.nynma.org.

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