The International Radio and Television Society (IRTS) Foundation last night gathered executives from Google, Time Warner, Hearst-Argyle Television and The New York Times Co. to offer solutions to the 360-degree equation. Meanwhile, at the National Academy of Television Arts and Sciences, TVN Entertainment arranged for NATAS Advanced Media Committee Chairman Shelly Palmer to grill VOD experts on best practices for this new media.
Digital business is tricky
At IRTS, it was clear that for TV vets the digital side of the business is tricky. "You want to create vertical brands with the consumer that are more platform-agnostic, but it's not an easy task," said Terry Mackin, exec VP-director of digital media for Hearst-Argyle. "Just because you're in the TV business for 15 years it doesn't mean you can walk across the street to the internet and be good."
That includes a new NBC/News Corp. project, which he believes will succeed only if it has compelling content that keeps consumers coming back. "If you go to McDonald's and get cold french fries, it's going to register with you. If you get cold french fries again, you're done. It's the same online. It's a slow process to program, design and build a new value proposition."
During that same panel, Michael Steib, director-TV advertising for Google, offered one strategy for marketers looking to launch a truly integrated campaign. "If I'm selling a hybrid SUV, I'm going to buy a magazine ad, obviously. But if you get that SUV next to a search term, there's a much bigger likelihood of reaching advertisers," he said. "It's all about building brand awareness so that by the time you serve the consumer with a contextual ad they should know there's no better brand than yours. I subscribe to the belief that there are ways we can bring new tools to the forms of media."
No secret Google plan
Mr. Steib came to Google from NBC two months ago to head up its TV ad department as part of the digital giant's new slate of offline ventures, which also include radio and print. Because the TV side is so new, he said he couldn't discuss the business model in detail. But that's not to say that Google is plotting some stealth media blitzkrieg, either. "There's not a secret Google plan," he said. "We've spent a lot of time with agencies. We are pretty open about what it is we'd like to accomplish. We believe there are big ways to serve advertisers and users."
With so much time spent solving the Google-YouTube questions, the two print panelists made sure to remind IRTS members the proven effectiveness of their medium. "No one wants to read a magazine on their cellphone," said Betsy Frank, chief research and insights officer for Time Inc. Media Group.
Returning to Mr. Steib's analogy with the hybrid SUV, Ms. Frank pointed to a real-world example, an automotive manufacturer that hasn't shifted half its ad spending online yet. "Toyota increased their print spending last year, and they're one of the strongest companies right now. You do the math."
Meanwhile, across town, NATAS' panel was ready to illuminate why VOD is a fast-growth phenomenon that's caught on with a cadre of consumers. Its growth is the result of a consumer habit dubbed "video snacking" by Mr. Palmer. "Consumers love this short-format content, and watch it most at the office and on Saturday afternoons."
VOD is still a young medium, and those who specialize in creating content for it are truly pioneering. The panel explored several topics, including finding the sweet spot for VOD; what business model works; and whether consumers will tolerate ads in VOD content.
Participants included Daniel Ronayne, exec VP-general manager of Lifeskool and Sportskool, two On Demand networks owned by Rainbow Media Holdings; Adam Devejian, a business development executive at Creative Artists Agency, responsible for developing deals for CAA clients (including Hasbro, Delta Air Lines, Starwood and hundreds of artists) in new technology; Neal Shenoy, managing partner of 212Media, and head of corporate development for Bollywood on Demand Video on Demand; Matt Cohen, senior VP-strategy and business development, TVN Entertainment, a TV on-demand company; and Peter Clifford, senior VP-distribution and affiliate marketing, at World Wrestling Entertainment, whose products include the VOD offering, WWE, 24/7 On Demand.
Rainbow's Mr. Ronayne, when asked about VOD's sweet spot, responded, "We've found that custom built content for the VOD platform works better than re-purposed content from other, "linear" sources.
Passionate about content
212Media's Mr. Shenoy noted that VOD is not a "build it and they will come model." But people who are passionate about certain types of content will search hard to find what they want. "We've found that those who are passionate about SouthEast Asian content -- Bollywood movies and music -- have an appetite for what we offer. We also benefit from the fact that there's just not a lot of similar content available in other venues, such as cable or theater chains," he said.
When asked if consumers will tolerate ads in VOD content, Mr. Ronayne said it depended on the ad. "If it is a spot for Nike, it might be tolerated. Otherwise, 10 seconds would be the most ad time you'd get. We've built a model around sponsorships rather than ads. Jeep, for instance, sponsors our Action Sports series on Sports. We proposed integrating the product into the programming, which the client OK-ed. Then we put the brand in an immersive way into the programming -- not a hard sell at all."
CAA's Mr. Devejiian believes a TV model can work for VOD. "We're trying to take the TV model of packaging and move it to VOD. Good quality content is important. We're looking for the business model that supports the ads." But Mr. Shenoy was quick to acknowledge that, like for most emerging media, the ad model for VOD "is still being worked on."