The industry needs a way to target consumers on their platform of choice argues Mark Popkiewicz, chief executive officer, MirriAd.

IBC

The consumption of video, in all its formats, has changed fundamentally in a very short space of time. In the 1980s the market was relatively simple to understand and limited to three main outlets – broadcast television, cinema and VHS tape. The content was all linear, the viewing experience passive and the advertising opportunities were well established.

Fast forward to 2008 and the environment is very different but in many ways the advertising industry has failed to keep pace with the complexities.

It’s worth looking at the way the average 15-year old boy accesses video today for pointers to what is happening in the market. He may well switch on the television but even in that environment he’s likely to pre-record using a digital video recorder (DVR). It’s likely he’ll also be accessing video on a computer, watching short form video on YouTube, long form via the BBC’s iPlayer, web TV on Joost or music clips direct from MTV’s web site.

It doesn’t stop there – his Wii or Xbox also lets him access a variety of video services and his portable games console and mobile phone will be stuffed full of video. His experience is characterised by choice – he chooses what to watch and when to watch it and he chooses the access device (fixed, mobile or a combination). It couldn’t be further from the traditional broadcast model in which the content owner and broadcaster effectively control the experience

So how has the advertising industry responded? Not surprisingly it has persevered with the established 30-second slot and for good reason. The traditional broadcast model has life left in it but the returns are diminishing as consumers skip ads using increasingly capable DVRs and move to other, user interactive, platforms on the internet. The 30-second slot has no place on the web and instead advertisers focus on pre-rolls, banner ads, overlays and pop-ups. They each have varying degrees of success but all detract from the core content and are universally unpopular as a result. What the industry needs is a way to target consumers on their platform of choice, at their time of choosing and in a format they find acceptable – a sophisticated solution that maintains the viewer’s immersion in the core video asset but which also allows that asset to be monetised through unobtrusive brand promotion.

The obvious answer is to make increasing use of product placement strategies to integrate brands in the original video content. If properly implemented it’s highly effective and results in viewers making the desired brand associations without their viewing experience being compromised. The evidence is in the growth in this sector of the market with analysts predicting an annual compound growth rate of 33.7% and an expected worldwide value exceeding US$14Bn by 2010.

Embedded Advertising

Unfortunately the established ‘physical’ product placement model has none of the flexibility of the other advertising models. It’s complex, costly, time consuming and needs to be implemented when the video asset is produced. Worst of all, in a market in which popular content is reused in a variety of formats and platforms, and over a number of years, physical product placement is in the core asset for good. The value of the placement diminishes over time and may be completely inappropriate in certain circumstances.

A new ‘embedded advertising’ industry is now developing to address these issues and it promises to bring sophisticated product placement strategies to a much wider market. It’s now possible to automatically identify brand insertion opportunities in existing video assets (from user generated content to Hollywood movies) and to seamlessly insert brand references as if they had been incorporated in the original production.

Those brand references may include physical objects such as vehicles, or, for instance, still or video images on a billboard and on many platforms they can be fully interactive (’see it, click it, buy it’). The advantages are numerous and significant because the exercise can be carried out at any time and brand insertions can be geography, demography and platform specific.

Embedded advertising has the potential to offer the best of both worlds. It utilises an established and successful format that can’t be skipped by viewers and yet doesn’t inhibit their immersion in the core production. It provides content owners with a fully integrated and scalable means of monetising existing video assets and delivers a flexible solution to advertisers that allows them to address an increasingly fragmented market.

The 30-second slot isn’t dead yet because it works and it’s easy to implement. We also know that product placement works. Expanding its reach and application with an embedded advertising platform, integrated within the sales and content pipeline, may just deliver the sophistication the market now needs to fully exploit its video assets.

View original article at IBC.org