From the 4A's Media Confab

Will VOD Ever Live Up to Its Potential?

At 4A's: Industry Explores Possibilities as Medium Becomes More Widely Available

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ORLANDO, Fla. ( -- Video on demand holds a lot of promise for advertisers. The question is when the potential in this emerging media venue will start to be fulfilled.
One day, theorists propose, marketers will be able to insert ads into pieces of programming that play off the type of programming being selected or have direct relevance to the people making the selection. While those theories remain just that, the availability of VOD programming has begun to increase, two experts on the topic told an assemblage at the annual 4A's Media Conference and Trade Show -- as has the potential for advertising to accompany it in new and interesting ways.

Holding out hope
VOD has long been seen as a new hope for advertisers. With more consumers using ad-skipping DVRs, VOD is seen as something media outlets and marketers have more control over.

ABC's recent announcement that it would make more of its prime-time programming available to cable, satellite and telecommunications companies if they disable customers' ability to fast-forward gives some ballast to the argument that making shows available as consumers wish could be a marketer's boon.

Curt Hecht, exec VP-chief digital officer of Publicis Groupe's Starcom MediaVest Group, said VOD eventually could give marketers the opportunity to "dynamically insert" advertising. In other words, marketers could insert ads that make sense at the time the VOD selection is made, reflecting a sale that starts on a particular day or a change in pricing at a car dealership. This technology allows for ads "that are fresh" each time a piece of video is selected by a particular household, Mr. Hecht said.

He also suggested VOD could allow viewers to "telescope" from the video they are watching to other pieces of video from advertisers, then return to the show as they wish.

Targeting by set-top box
Mitch Oscar, exec VP-director, Carat Digital, took the discussion a step further, saying that if cable and satellite companies work with advertisers, marketers could gain the ability to target ads to individual households and thus run ads "not by program but by set-top box."

Advertisers have been licking their chops over the potential of VOD for some time, but several obstacles remain. For one thing, the many different cable operators that serve U.S. consumers use different standards and technology, making it extremely difficult to run a single promotion or ad widely. What's more, many cable companies are concerned about the perception that they might be invading consumers' privacy by turning over information from set-top boxes to media buyers and marketers.
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