Digital Conference

Advanced TV Isn't About Making More Money. It's About Fewer Ads and the Same Money

'Commercial Ad Load Has Been the Same Since Truman was President'

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(From l.) Michael Strober, Peter Naylor, Joe Marchese, Mike Law and Jeanine Poggi
(From l.) Michael Strober, Peter Naylor, Joe Marchese, Mike Law and Jeanine Poggi Credit: Rob Tannenbaum
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TV is heading toward fewer commercial breaks and ads that better resemble the surrounding content, industry leaders said Tuesday, but there's a lot of work to be done before consumers would exactly call that the new norm.

"It might not happen all at once," said Peter Naylor, senior VP-sales, Hulu, during a panel on day two of Advertising Age's Digital Conference in New York. "It's a creep but it's definitely happening."

There have been moves toward lower ad loads before, but there seems to be more credible momentum toward reforming the TV ad model now as consumers embrace growing alternatives, leading, among other things, to declining TV ratings.

"There's a saying I keep hearing: 'Television advertising is killing television advertising," said Michael Strober, exec VP-client strategy and ad innovation, Turner Broadcasting. The medium is staying the same even while everything changes around it, he said.

"The commercial ad load has been the same since Truman was president," Mr. Stober added.

As a result, programmers, as well as network-owned Hulu, are increasingly bringing new options to marketers, including new data-driven products designed to help marketers better find their target consumers. "Our responsibility is to present these solutions and then see what the marketplace reaction is," Mr. Strober said.

There is appetite on the buy side, said Mike Law, exec VP-managing director, video investments, Dentsu Aegis Network. Media buyers and planners just need to start with brands' needs and then work from there, he said.

One drag on uptake is the the variety among data products and creative units, variety that makes executing a new-look ad buy more complicated than for a 30-second spot bearing traditional demographic guarantees.

Hulu is happy to take 15-second spots or even 5-second ads, Mr. Naylor said. "Recently we took a 5-second spot from Tic Tac and it was very creative, very elegantly done, and it's a bit of a relief to the viewer," he said.

Under 5% of Turner deals in this year's upfront are likely to revolve around something other than traditional age and gender guarantees, Mr. Strober said. Marketer interest is there, and those who try Turner's data products continue to use them, he said. But every media company has its own solution, he said. "So how do we normalize that for the industry?"

Regardless, it's the only way forward, according to Joe Marchese, president-advanced advertising products, Fox Networks.

That's partly because digital media competes by different rules, where, for example, video ads are considered "viewable" if half their pixels appear on screen for two seconds. That doesn't fly for TV, where ads fill the full screen, and always have. "You'd lose more than 95% of digital inventory if you said it had to be the whole screen," Mr. Marchese said.

"The promise of advanced advertising isn't to make more money," he said at another point. "It's to have less ads and make the same amount of money."