Wednesday, November 25, 2009

Truth vs. facts: The sequel

Back in April, we commented on TiVos impending challenge to the Nielsen TV rating hegemony in influencing advertising rates: Truths + Facts: Belief systems being challenged [here].

Now, the worst fears of those who extract value through an opaque relationship between TV ad impressions and ad performance may be realized: Google is entering an agreement with TiVo to use its data on ad-skipping in a pay-for-performance manner [here].

So What?

The implications of better data on which TV ads are being seen (as opposed to skipped) exist on a plus or minus scale of positive to negative impacts...if you sell ads based on extrapolated audience deliveries (e.g., based on Nielsen Household Survey data) it may weigh negative. If you want to pay for performance, you'd certainly think it was a positive to have data supporting the invoice.

Of course these are the self-evident truths we hold when stereotyping TV as an old school sales game and Google's pay for performance model as the all knowing oracle of answers to questions we haven't even thought to, er, Google.

Here's three reasons I think TV networks will find a deal like TiVo-Google a good one:

  1. TV networks can objectively support their advertising value in the pay-for-performance era and define themselves as a viable part of that mix.
  2. Knowing under what circumstances ads work (i.e., which ads don't get skipped) can help networks create more flexible ad packages around second-by-second behavioral data...a single advertiser with a consecutive series of 2, 7, and 50 second spots in a pod might make as much sense as multiple advertisers in a single pod. 
  3. Flexible pricing models that enable auction-style bidding (similar to pay per click search marketing) may bring new advertisers to the networks by removing cost barriers.

Certainly there are many other positive implications to be realized. And while it's easy for some to incessantly describe the imminent doom of Big Media, the reality is that knowledge, accountability and transparency are good for everyone in the long run. The alternative---ignorance, irresponsibility and trading in secrets--has no productive place in a social construct--like advertising--that relies on trust.

No comments:

Post a Comment