I have a lot of friends who work in Hollywood, and a fair number who work in advertising. When I talk about television with any of them they all tell me the same universal fact: People love television but hate commercials. Nothing frustrates a viewer more when than when they’re really into the story of the latest episode of their favorite TV show and then the channel cuts away for a regularly scheduled break.
But television commercials are just a fact of life. Without them 99% of television programming would not exist. Commercials are how the networks make the money to make the shows that you love to watch for “free.”
And since the birth of television in the early 20th century, there was little a viewer could do to get around a commercial. Then came the 21st century and Tivos and DVRs. And though these new digital devices that allowed viewers to record their favorite shows and skip the commercials were a godsend to consumers, it pissed advertisers off to no end. You just can’t imagine.
And since then DVRs and similar technology have been a double-edged sword for everyone involved. Networks liked the devices because suddenly time slots didn’t matter as much as they used to. If a big game was on one channel, those that liked a TV show airing on another channel at the same time would still get to see it…eventually. This helped networks and shows retain a regular audience. On the other hand, the network’s best buddies–the advertisers–hated this because they knew most people weren’t going to sit through their brilliant commercials they were paying big bucks to run if viewers could just fast-forward through them.
Likewise, though the ability to skip past commercials might seem like a total win for viewers, eventually if people stop watching commercials, why should advertisers keep paying for them? And once that happens the networks suddenly don’t have the cash to pay the costs it takes to produce a show, which means television programming dries up, leaving the viewer with a TV, but nothing to watch.
Apple Is Working On Breaching The Impasse Between Consumers, Networks, Advertisers, And Tech Companies–But It Won’t Work
Television needs advertising to function. But the problem is, it’s very hard to change consumer behavior. And in the last decade consumers now expect instant gratification as part of the deal. When we want a book, movie, app, or TV show, we want it now (or, as fast as our Internet connection will allow us to download it). This “now” attitude in consumer behavior also means that the ability to skip commercials to get back to the story is just something that is expected. Technology companies know this, so they’d be stupid to leave out commercial-skipping tech from their products (read: smart TVs), or else consumers won’t think those products are full-featured.
Talk to anybody in the industry and they’ll tell you that things appear to be at an impasse. What consumers expect is what technology companies want to give them, which is what advertisers fear, which means networks and content owners have to walk a careful tightrope between the needs of their advertisers and the expectations of their consumers in an increasingly digital age.
So what to do? When smart TVs go mainstream, if they don’t offer a DVR/commercial-skipping function (a technology which is over a decade old), people are going to feel ripped off. But if an Apple patent is any indication, the Cupertino company is working on the problem. As Jessica Lessin writes on her blog:
Apple has a new trick up its sleeve as it tries to launch a long-awaited television service: technology that allows viewers to skip commercials and that pays media companies for the skipped views…In recent discussions, Apple told media executives it wants to offer a “premium” version of the service that would allow users to skip ads and would compensate television networks for the lost revenue, according to people briefed on the conversations.
It is a risky idea. Ad-skipping would disrupt the entrenched system of television ratings—the basis for buying TV ads. In fact, television broadcasters sued Dish Network when it introduced similar technology last year.
On the surface, this seems like a nice idea. Apple sells smart TVs to consumers who skip commercials that advertisers are then reimbursed for. But the problem is that paying off an advertiser for each person that skips their ads really doesn’t help the advertiser in the long run. The advertiser’s goal is not to make money off someone viewing the commercial, it’s to generate brand awareness and future sales from viewers watching that commercial.
Ultimately, Apple’s patent means the advertiser is essentially collecting bribe money from Apple and not getting what it really wants–brand awareness from the viewer. In the end, why wouldn’t the advertiser just leave TV and spend its valuable advertising dollars in other mediums?
In film school I first learned about “aspirational programming.” That’s a term coined by Hollywood and marketing people in the second half of the 20th century. Aspirational programs are television shows that dangle a carrot in front of the audience. They are programs that show us things we aspire to have one day: beautiful friends, lots of money, nice cars, exciting jobs, exotic trips.
Think: Gossip Girl.
Think: Sex in the City.
Think: any stupid reality show about rich, beautiful people who are famous for doing nothing.
Though aspirational programming is vastly unrealistic (on Friends, how could Rachel, a waitress, and Monica, a chef, afford what is clearly a million-dollar-plus apartment in New York City?), the reason the shows are so popular is because viewers want to believe that they too will one day live lives just as exciting, sexy, loving, or rich as the characters on their television screens. It’s just how we’re wired: the desire that overrides reason.
And ask anyone in advertising and they’ll tell you that that desire that overrides reason is exactly what they want. If you’ve ever really examined a commercial you’ll notice that it’s not actually selling a product; it’s selling an experience that happens to you when you use that product (“Oh! If I use Colgate toothpaste to brush my teeth, that 22-year-old supermodel who works in my office as a secretary will take notice of me.”). The fact that advertisers know people are so susceptible to aspirational programming is why they love product placements so much.
And it’s here in the decades-old practice of aspirational programming and product placement that the future of television advertising can thrive in a world of smart TVs, thanks to MTEVideo, a brilliant software advertising platform from a small company called Cinematique. As David Castillo writes for ProductPlacementNews:
In videos by Cinematique, prompts appear on selected products. If a product is clicked, the video will display basic information about it. And after viewing the video, consumers can click the Cinematique icon to see a summary of the information from all the products they selected.
Experts say that the new platform has tremendous e-commerce potential. Similar to tagging pictures, tagging items on video can be a good marketing tool. While the features do not force immediate purchases, it can give marketers detailed information about people that are interested in their products.
As of now, the MTEVideo platform is only available on the desktop, but if this technology is built into the OS of every smart TV, it could fundamentally change television advertising forever. All parties win: No more commercial breaks for viewers, increased hyper-targeted ads for advertisers, and continued revenue streams for networks.
Like that dress your favorite character is wearing? If your smart TV has Leap Motion-like hand gesture control, just swipe you finger in the air to add it to your want list. Does that car the bad guy is driving appeal to you? Tap in the air to learn more about it.
This type of advertising would also mean product placement wouldn’t even be limited to the big companies anymore. Smart TV advertising could get truly local. Does that steak dinner the TV stay-at-home-mom-by-day/crime-fighter-by-night is cooking for her family look good? Tap it in the air to see local deals on steak dinners in your area. Even reruns of old shows could become more profitable. Like that top Buffy is wearing as she’s slaying all those vampires? Tap it to see it was from American Eagle–and here are some up-to-date fashions like it.
Any new technology scares old media–and then old media’s advertisers. But if those two institutions embrace new tech to give viewers ads worthy of the 21st century, then smart TVs in every living room will be something they will be able to welcome, not fear.
[Image: Flickr user Mcfarlandmo]