Madison + Vine: TiVo, advertisers link for new content deals

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TiVo is undergoing a quiet revolution that may change its adversarial relationship with the advertising industry.

San Jose, Calif.-based TiVo is luring marketers such as Best Buy Co., New Line Cinema and BMW into unique, long-form advertising and branded content deals that are beginning to find enough traction with its estimated 620,000 subscriber base that some have signed up to run additional programs.

Interest in TiVo as an advertising medium may stem from a desire to experiment, but fear over the system's ad-skipping capability is likely also motivating a new working relationship between TiVo and a handful of marketers. Consumer surveys showed that consumers cite TiVo's ability to skip ads as a key reason they like the service. But given the opportunity to choose from a menu of exclusive content-first looks at movie trailers, music videos, celebrity interviews and short films-will they choose to tune into a marketer's message via a TiVo showcase? TiVo says yes.

TiVo has done deals for its advertainment showcases with a variety of marketers, mostly from the entertainment industry. They include Universal Music labels such as Interscope's Jakob Dylan-fronted band The Wallflowers, New Line Cinema flicks "Austin Powers," "Lord of the Rings: The Two Towers," and "About Schmidt," and the National Football League. Best Buy, TiVo's retail partner, has run multiple programs on the service including a Best of Bond showcase and a holiday program. TiVo is on the cusp of signing two auto marketers it declined to name.

"We're talking to everyone, doing longer-term deals and multiple campaigns over many months," said Brodie Keast, senior VP-general manager, TiVo Service.

While entertainment marketers and Best Buy have accounted for the bulk of showcase advertisers, Mr. Keast is courting tech, auto and consumer package-goods advertisers. Sponsorships, such as Best Buy's agreement to sponsor "Waiting for Woody," a 30-minute independent film produced by the Standard Film Trust of Los Angeles, starring George Clooney and Jennifer Aniston, also figure into the mix. TiVo subscribers decide whether they want to view the film after watching a trailer.


Even as marketers scramble to forge product- and plot-placement deals with Hollywood talent agencies in an end run around TiVo's and its rivals' ad-skipping technology, they are also sidling up to TiVo, its affluent subscribers and the permission-based TV ad model.

TiVo has a rate card for the showcases and offers audience-measurement data to demonstrate the effectiveness of the programs. The standard showcase is four minutes for one week on a CPM-based model, and is promoted on the TiVo Central screen. Advertisers receive an audience research report with the results of the program. Extras might include discounts on an additional week and customized research.

"We really love them [TiVo] because they reach an upscale audience of TV-friendly, early adopters," said David Spiegelman, senior exec VP- domestic television, distribution and marketing, New Line Cinema. For its Austin Powers showcase, that ran for two weeks in July, New Line achieved a 60% take rate with viewers staying in the showcase for an average of six minutes. TiVo sent a crew to the "Austin Powers" and "Lord of the Rings" press junkets and filmed interviews with the stars, which contributed to the original content offered in the showcase. "The beauty of this is we refresh the material," Mr. Spiegelman added.

In November, Best Buy tested three Best of Bond video clips culled from a seven-DVD Bond collector set. At the end of the showcase, text states, "If you like this and want more information, click here." The permission aspect is significant because the TiVo subscriber doesn't become a Best Buy customer, i.e., isn't entered into the retailer's database as a marketing prospect, until he or she purchases something, according to Mollie Weston, production manager, Best Buy Advertising. A subscriber must give permission to release his or her e-mail address, which TiVo has from initial registration with the service. In the Bond run, once the permission was granted, the subscriber received an e-mail the next day from Best Buy that linked them to the Bond page on the Best Buy Web site. "We were able to see whether they purchased off the site," which then deemed them a Best Buy customer, Ms. Weston said.

almost real time

While the data are still being analyzed, preliminary findings from the program show that the total of net daily household impressions was 41.8% and the average time spent in the showcase was just under four minutes.

TiVo audience research never identifies individual consumers, but it does offer "near real-time" audience measurement data. For example, TiVo knows when a viewer has opted in to a showcase, the average time spent, the average time spent on each video clip and which clips were most watched, how many viewers accessed the showcase, when and how often.

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