Advertisers Hope for VOD

Video on demand (VOD) promises what many advertisers want, but they may not get it because viewers aren’t watching VOD.

In a recent article in Ad Age, Rino Scanzoni, a leading media buyer, made a point about DVRs versus VOD that got my attention:

 Mr. Scanzoni: I have to tell you that video-on-demand offerings on some of the cable players — I have Comcast and it’s very, very robust — I think there are a lot of people who might sit there and say, ‘Why am I paying $9 to $10 to have a DVR when I can go to VOD?” And I think the ability to “dynamically insert,” where they can update the ads, can over time mitigate a lot of this.

Cable operators tell advertisers that with their VOD service ads can be inserted after the broadcast, targeted more directly at certain households, and updated. This would seem to provide an advantage over linear television and would ameliorate the pain some advertisers may feel paying for timeshifting DVR audiences. Furthermore, VOD services often disable the fast-forward function. (Treating audiences like timeshifting bandits and insisting they sit through the ads in real time merely to keep their business model alive seems like a distinctly consumer-hostile approach to me.)

Premium-300x225So, one problem with this “solution” of relying on VOD instead of those pesky DVRs is that viewers don’t like VOD as much as they like DVRs  and OTT (over-the-top) services like Netflix (which can fast forward). Why? Because the VOD interfaces are clumsy, hard to navigate, slow, and irritating. Why are the interfaces so bad? Because cable operators are still thinking like monopoly providers: Hey viewers, be happy we’re offering you this service, even though it’s a pain to use!

As a representative for advertisers, his clients, Mr. Scanzoni hopes that viewers will want to reduce their TV costs by ditching their DVRs and shift to VOD. Not because DVRs are less convenient (they are often more convenient) but because ads can be “dynamically insert[ed]” and this could “mitigate” the so-called problem of timeshifting.

Mr. Scanzoni should be concerned instead that more viewers may be ditching their cable subscriptions or never signing up for cable and so are skipping VOD altogether in preference for OTT services. Given that cable VOD services still don’t have nearly the range or depth of catalog that Netflix offers, or the ease of use Hulu provides, or the sheer variety of YouTube, Mr. Scanzoni may be engaging in wishful thinking.

Advertisers who continue to believe that forced viewing of commercials is a good business model may find themselves disappointed when VOD is replaced by OTT services, which specialize in user-friendly interfaces, or when VOD never catches on as well as DVRs, which provide more selectivity and viewer control of playback.

In any event, advertisers should try thinking more like a consumer-viewer and less like a legacy media business. They might find audiences more receptive to their ads when audiences are asked to engage rather than forcibly exposed.

(Image source: Amanda Lotz)


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