Navigation Guide, Advertising Universes Aligning

Sun, 01/31/2010 - 7:45pm
Craig Kuhl, Contributing Editor

But business model and deep-seated tradition issues remain

The two separate worlds of advanced navigation systems and advertising are gradually aligning. And though not exactly at light speed, there are growing signs of a much-anticipated convergence. Google has proven that search with targeted advertising is a very, very powerful combination.

The emergence of intelligent data, psychographics and deep-dive demographics as methods of determining viewing habits and behavior, coupled with the integration of advancing technologies into navigational guides – including whiz-bang graphics – is driving fundamental shifts in the traditional worlds of guides and advertising.

At the core of the shift is the lucrative advertising market of TV, PCs and mobile devices – the three-screen effect – and the advertising interaction among those screens. Not to mention the branding possibilities.

Jinni Guide

“All advanced navigation tools have been in the works to appear on all screens. When you’re in the process of navigating, that’s a great time to insert ads and develop search patterns. For advertisers, it’s all about reach and engagement,” said Gerry Kaufhold, principal analyst for the research group In-Stat.

Engagement indeed. By 2012, 92 percent of U.S. households will be connected to broadband, while 36 percent of digital sets sold in 2013 will be network-enabled. And DTVs are now the only TVs available in most of North America, Western Europe and Japan, In-Stat reports.

Those types of numbers are pulling the advertising-navigation alignment closer.

“If consumers log in to a service provider’s Web site, the same mechanism will work for TV anywhere, so cable operators are a step ahead through their ‘elegant engineering,’ and advanced advertising is part of it,” Kaufhold noted.

The convergence of advanced navigation systems and advertising signals an important leap forward, especially for service providers such as Comcast, which has grown its iGuide usage from 2.5 million in 2007 to 13 million today.

“The navigational guide is the connective tissue between several programs and commercials. We’re selective about the advertisers we take the platform to, and the navigation guide must first be an aid to navigating. But we have to put our toes in the water for banners,” said Chip Meehan, vice president of advanced advertising sales for Comcast Spotlight.

The guide/advertising water for years has been murky, with the lack of eyeballs and functional technologies and the absence of a working business model being some serious impediments.

That is changing, however. Companies such as Rovi, Jinni and others are breaking new ground with advanced navigation systems that enable new forms of advertising across multiple screens and that can reach coveted target markets and consumers.

“The root of all our guides is advertising, like banners alongside listings and more advanced advertising capabilities. It’s like a mini-Web site with direct interaction and click-throughs. It’s a new guide built from the ground up,” said Corey Ferengul, executive vice president of product management and marketing for Rovi Corp., whose TotalGuide will be delivered in Q1 and embedded in STBs, TVs and Blu-ray players.

The guide, he noted, was developed after extensive discussions with several advertising agencies, albeit with plenty of pressing questions.

“There were questions like how effective can the guide be with advertising since no value has been put on the guide, and can we really engage the consumers? How do we keep them engaged? How does advertising stand out in a guide? How do customers buy over the TV? And what about addressable advertising and click streams? Those are all challenging questions,” Ferengul said.

And there’s the business model, or lack thereof. Continued Ferengul: “Highly targeted ads are a challenge because the business model isn’t there yet. We’re all experiencing pressures on the business model.”

Pressures aside, the navigation/advertising convergence is in play and is getting closer to reality, industry experts agree.

Jinni, for example, uses a deeper and wider classification of content using its Movie Genome and is building a “new language” for entertainment.

“The user experience is only as good as the underlying data, so we created Jinni, which uses Genome for search, mood, plots and recommendations. It’s a nextgeneration guide organized by subject and theme using meaning instead of keywords,” explained Yosi Glick, president and co-founder of Jinni.

Jinni, Glick continued, is now focusing on the advertising component. “We’re still cooking up how to use Genome to benefit advertisers. For example, life insurance is a good match for the movie ‘Titanic.’ This is the direction we believe advertisers should go.”

Going in the on-demand direction with advanced navigation and advertising is another strategy getting traction. But it has its own set of issues, admitted Nick Troiano, president of BlackArrow, a provider of advanced advertising technology.

“How do you facilitate the ad buy to reach the consumer and actually buy and sell the ad? What’s the value to the ad provider? We have to create currency and monetize the value of the ads. It’s not a technology issue, it’s a business issue.”

Yet the relatively stormy process of building a workable business model may be calming, some suggest.

“Advanced navigation and advertising is the perfect storm advertisers are looking for. Operators build out infrastructures to enable advanced advertising, including mobile carriers. It’s a perfect scenario,” said Laurel Gilbert, director of business development for advanced advertising at Sigma Systems.

Sigma is in the center of the storm with its Subscriber Information Service (SIS), a technology that allows for highly relevant ads based on “audience qualifiers” from collected data, Gilbert explained.

“It helps make the best decisions about what ads to deliver to a subscriber without exposing who you are and is based on behavioral, geographical and other data. The whole acceleration in advanced navigation and advertising is being driven by no more spray-and-pray attitudes, but by measurement and deep-dive reporting.”

Rovi TotalGuide

Diving deeper for pertinent information about content is pulling the navigation/advertising sides closer together.

“If you treat the advertising and branding opportunities as content, that’s what advanced navigation systems are bringing to the table, and ads are a piece of that content,” said Jeremy Edmonds, director of product management for ActiveVideo Networks, a player in the advanced advertising space.

Yet even with the technological advances made in navigation, it remains a matter of how many viewers you can count, a fact not lost on the cable industry, advertisers or supporting companies.

“You only get serious dialogue with advertisers when you have a certain amount of eyeballs. But projects like Canoe are evolving, and technology challenges such as two-way connectivity have pretty much been resolved with DOCSIS 3.0. We’re also looking at voice activation, while more people are using guides to find content across three screens. New interfaces are also easier to use to integrate ads, along with branding. These are all valuable to ad agencies,” said Steve Tranter, vice president of broadband and interactive for NDS, whose Snowflake user interface deploys a 3-D grid overlaid on live TV and is controlled remotely.

The value of graphically stunning navigation guides and their ability to reach multiple screens remains a work in progress, however. But there have been some substantial gains.

“There’s no model for advertising in the guides themselves, and it’s still nascent. We’re trying to create value out of advertising and are looking at search and discovery around content. We think advertising will be in lockstep with richer discovery guides, and the advertising model will be very important. Just where isn’t clear,” said Ben Huang, director of product management and marketing for Microsoft Mediaroom.

What is clear, concluded Kaufhold, is that the two separate worlds of navigation and advertising are aligning.

“When navigating and reading reviews, it keeps eyeballs on an ad versus the traditional 30-second spot, and advertisers get the engagement they want,” he said.

Graphics are key

Just how important are graphics to advanced navigation guides and advertising? Most agree they can be crucial.

Jeremy Edmonds, ActiveVideo:
“Graphics are a key piece for operators and advertisers, who require technically and graphically a full, rich pallet of colors, motion video. So creative tools are needed.”

Corey Ferengul, Rovi:
“We’re pushing the edges of graphics on the guides and already making look and feel changes. Highly graphic images are vital because the advertising community wants engaged eyeballs and viewers to say, ‘Wow.’”

Laurel Gilbert, Sigma Systems:
“Graphics are very important, but they must be dead-on, with no big, monstrous overlays on the screen.”

Ben Huang, Microsoft:
“They are very crucial. The navigation experience is moving toward text-based experiences and should be getting back to the visual paradigm. It’s a key point for us.”

Chip Meehan, Comcast Spotlight:
“Future versions of our guide will have engaging, moving graphics.”

Steve Tranter, NDS:
“We’re experimenting with 3-D graphics, and people will want HD-type graphics on their navigation guides. It’s not a tipping point to cancel cable service but could be a valuable add, especially with multi-rooms.”

Nick Troiano, BlackArrow:
“On-screen graphics must be high quality, so the creative will be very important to the advertisers and operators because that’s their brand.”



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