OPEN MIC: Competition In the New Advertising Environment

Sat, 10/31/2009 - 8:15pm
Paul Woidke, senior vice president and general manager of advanced advertising at OpenTV

To succeed, ops must compete for ad dollars
across all technologies and platforms.

The TV advertising business is entering a new era.

The number of video platforms available for advertising has grown tremendously in recent years – including on-demand video, broadband Internet and mobile devices, not to mention high-definition video augmenting standard-definition on all of the platforms. This is a very different landscape compared with the days when a content distributor was concerned only By Paul Woidkewith a single vertical integration of advertising insertion and delivery. And as the number of advertising platforms increases, the back office management tasks of researching, buying, managing inventory, order processing, scheduling, verification, invoicing and reporting become significantly more complex.

In addition, television advertising now takes numerous forms beyond the traditional linear 30-second spots, most radically interactive and addressable advertising. Not previously feasible with traditional telecasts, addressable advertising delivers messages tailored to specific audiences. This new technique is positioned to become the future of advertising.

A variety of delivery technologies have been proposed for addressable advertising, including STB client-based stream switching, PVR/DVR-based insertion, SDV unicast and IP delivery. Regardless of the actual “delivery infrastructure,” addressability requires a different logistical approach to the advertising sales back office. These technologies will also allow for “verification” of spot delivery, adding a new requirement to store, manage and analyze monumental amounts of data.

These changes present great opportunities and challenges for cable, telco and satellite operators. To compete effectively, operators must find a new way to manage the dynamic and complex advertising environment efficiently and keep track of every aspect of the ad-delivery process, while offering advertisers the ability to easily reach the entire spectrum of available distribution platforms.

To address these challenges, many operators today are using a variety of disparate systems and processes that are patched together – from manual spreadsheets to outdated systems. The good news is that advanced campaign management solutions are emerging to facilitate execution of advertising across multiple platforms.

An advanced campaign management solution makes it more efficient, and more economical, for cable, telco and satellite operators to provide advertisers with multiple distribution opportunities. The economics are key because advertisers want access to this diverse selection of platforms without having to pay a premium for any of them. They don’t want to maintain separate infrastructures, hire additional staff and incur added costs for each platform, either. And they don’t want to deal with a different department for every platform. From the agency and advertiser perspectives, purchasing advertising should be a seamless and painless experience that encompasses all available platforms simultaneously.

A campaign management solution, especially one that is linked to the emerging standards (such as SCTE 130, SCTE 118 and others), is the most effective way to streamline the process for the advertiser, while allowing maximum flexibility for the platform operator. This type of solution not only delivers a customer satisfaction advantage, but also empowers advertising managers to achieve back office efficiency and monetize the potential delivery platforms.

An advanced campaign management solution is also a vital support for addressable advertising. A campaign management system must offer a consistent view of the addressable inventory for each platform and the available audience characteristics – regardless of the delivery mechanism – allowing the cable, telco and satellite operators to offer advertisers greater value for their advertising dollars.

EclipsePlus from OpenTV enables operators to maximize ad revenues by maximizing inventory yield. The solution provides end-to-end sales and inventory management from proposal and order entry, supporting both traditional linear video inventory and new, advanced VOD ad inventory. Capabilities to support interactive and addressable inventory will be tightly integrated.

For multi-program distribution operators, a competitive advantage will be based not only on a strong sales force, good delivery mechanisms and a wide variety of delivery platforms, but also on the ability to efficiently integrate and manage back office functionality for advertising campaigns across multiple platforms. Today, cable, telco and satellite operators are at a crossroads. They must make a choice regarding how they will approach this dynamic advertising environment. The operators that will succeed over the next few years – as we come out of the recession and advertising activity increases – are those with the aptitude and flexibility to compete for advertising dollars across all of the new technologies, regardless of the platform.

Next month, Yvette Kanouff, SeaChange’s chief strategy officer,
will write about VOD advertising.

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