Google gets into TV dynamic ad space
LAS VEGAS —Despite a nascent move by U.S. broadcasters and cable networks to start cutting back on commercials during their shows, consumers are showing mounting interest in using ad-blocking technologies.
In a study released at the NAB Show here last week, Accenture found that more than 60% of consumers worldwide are aware of several options for blocking TV commercials. Even more ominously for broadcasters, that number jumps to nearly 70% for the next generation of viewers under the age of 24.
“Ad blockers are a relatively new threat to the digital advertising industry,” said Gavin Mann, Accenture’s global broadcast industry lead. “Consumers are increasingly willing to pay for blockers because too many ads are poorly targeted. In today’s world of personalized content, being forced to watch an ad that has no relevance is a missed opportunity and feels increasingly intrusive on precious screen time.
On the positive side for broadcasters, more than 40% of consumers in the study said they would happily pay for content if that meant they didn't have to sit through any more commercials. Accenture surveyed a total of 28,000 consumers across 28 countries in both the developed and developing worlds.
However, the report was mostly a downer for broadcasters and other TV programmers, who have relied heavily on ads to support their business models for 70 years. For instance, about two-thirds (66%) of consumers aged 25 to 34, a key demographic group, said they’re aware of ad blocking technologies. As a result, Accenture advised the networks to stop trying to block the ad blockers and instead make better commercials.
“There’s no point in following the music industry’s failed attempts at thwarting piracy,” Mann said. “It’s futile to focus all efforts on trying to outsmart ever-evolving ad-blocking technologies to force audiences to watch ads. The industry needs to do everything possible to make ads less of an infringement on precious screen time, by building on early successes that deliver targeted, relevant and entertaining ads – in a creative style appreciated by the individual.”
The sobering news about the rising consumer awareness of ad blockers comes as the big U.S. networks scramble to cut their heavy ad loads after years of squeezing more and more ads into their shows. In the latest move announced Monday, NBCUniversal said it will chop the ad load for Saturday Night Live by 30% next season by getting rid of two commercial pods.
NBCUniversal's announcement followed a similar move by Turner Broadcasting to cut the commercial load on its truTV cable network. Turner says it will also reduce commercials in its new original shows on its flagship network, TNT, while Viacom, which recently has carried the biggest commercial load on its cable networks, has plans to cut back as well.
Even as the ad-blocking and ad-cutting movements gain momentum, though, big tech firms are still diving into the TV ad space. In the most prominent development on this front at the NAB Show, Google unveiled the launch of its new DoubleClick Dynamic Ad Insertion product, with initial distribution deals with Cablevision Systems and Roku, as it continued to infiltrate the TV space. The company also announced innovations in virtual reality (VR), cloud archiving and online listings, which will enable viewers to tap into streaming video directly from a listing.
Speaking during a keynote session here, Daniel Alegre, president of global partnerships at Google, said the new dynamic ad insertion (DAI) tool “makes ads hyper-relevant for viewers across any screen they watch by creating individual viewer streams. Using server-side ad insertion, we are able to deliver a better, more personalized viewing experience that looks and feels as seamless as TV today.”
Alegre said Google tested its new DAI product on TV broadcasts of the Rugby World Cup Finals on France’s TF1 and a Republican presidential debate on Fox News earlier this year. Noting that the tool enables programmatic buying, he said Google will set the programmatic element to enable close monitoring so that the same ads don't run repeatedly within a pod.
Joining Alegre on stage after his keynote talk, Cablevision COO Kristin Dolan said the cable operator's embrace of the DoubleClick product jibes with the company's overall innovation drive. As part of that drive, Cablevision just began offering Hulu as an integrated part of its pay-Tv service. “How do we allow people to not only experience when they want but also take advantage of the subscriptions they have to other things?” she asked.
Dolan noted, though, that live TV still accounts for 91% of the overall viewing by Cablevision's video subscribers. “It shows that a lot of people still want to watch things as they happen, which should be good news for all the broadcasters in the room,” she said.
