Better Monetization through Better Counting: Measurement Matters A Lot for Advanced TV/Video

Next week is the informative and stimulating TV of Tomorrow Show presented by Interactive TV Today ( – San Francisco March 3 & 4). ITVT calls it “The Experts Conference” and it is. If you have attended in the past, you know it’s a must go for people in the advanced TV and video space. There will be two days of panels and sessions featuring key participants in the advanced TV/video landscape. You can see the full schedule here.

I’ll be moderating a panel at 9AM on Wednesday March 3 – “Better Monetization through Better Counting: Measurement for Advanced TV and Video”

We’ll have an excellent group of panel members:

  • Andrew Capone, SVP, Marketing & Business Development, NCC
  • Jane Clarke, Managing Director, Coalition for Innovative Media Measurement (CIMM)
  • Cathy Hetzel, President, Advanced Media Information Division, Rentrak
  • Todd Juenger, VP and General Manager, Audience Research and Measurement, TiVo
  • Tracey Scheppach, SVP/Video Innovations Director, Starcom Worldwide

As I note in the description… “As advanced TV and video platforms afford new capabilities, they also create new opportunities and challenges for measurement. Metrics can support the growth of new platforms by reflecting added value created for consumers, content distributors and advertisers. But – to adapt an advertising maxim – ”if you can’t count it better, you can’t sell it better.””

By “advanced TV and video” I mean advertising using advanced TV technologies like addressable ads, interactive TV, VOD and DVR as well as other platforms including online video and mobile. This includes TV Everywhere style models and so-called “Over The Top” (Internet delivered video viewed on the TV).

This highlights one of our key topics – with so many potential outlets for advanced video advertising, how do you achieve relevant and usable ad campaign metrics in such a complex cross platform/technology/content provider/operator world?

On the topic of metrics, here’s a few selected numbers that I think inform the importance and urgency surrounding measurement for advanced TV/video.

  • 90% of US TV households have multichannel TV service (cable, satellite or telco IPTV)
  • 36% of US households have DVRs

Takeway – There’s little room for growth in the number of multichannel subscribers (and lots of room for expensive intra-industry competition or future externally driven decline). And while DVR penetration (the biggest internal challenge in TV advertising) has slowed from the peak of 7.25% of households a year, it’s still running at 6% and we’ve now passed the 1/3 mark in total. Quality of metrics will have a big impact on monetization of advanced TV advertising and placement of top-rank TV on VOD – cable’s best (and highly underdeveloped) defense against Over The Top competition.

  • 62% of US households have broadband
  • Cost of delivering one hour of HD quality video for large video providers – likely about $0.05/hour and continuing to drop rapidly – for the very largest it’s even less
  • $129 – price of the lowest cost BluRay player at Best Buy that’s Internet-connectable and NetFlix streaming capable
  • 48% of NetFlix subscribers streamed more than 15 minutes of video in Q4 09. NetFlix now features streaming most prominently on its web site to both current and prospective subscribers. NetFlix subscriptions are at 12 million and accelerating, while subscriber acquisition costs fall. In the first three months after the Nov. 08 launch of NetFlix on Xbox LIVE, one million boxes were activated for NetFlix and the average viewing during those three months was 25 hours per box.

Takeway – Today (as in right now) it’s possible to deliver low cost HD quality video to TVs in almost 2/3 of US homes via the Internet via low cost boxes being bought in big box stores. NetFlix has shown that lots of people will watch streaming video via PCs, BluRay players, Xboxes, Rokus, TiVos, Net-capable TVs and other devices. NetFlix is plowing the ground for Over The Top, what ad supported video enterprises will follow, drawn in part by these new platforms’ potential for better metrics?

  • Payment Per Click for top position in Google AdWords (the text ads in search) by big TV spending brands
    • About $3.50 per click for “SUV” – brands including Chevrolet, GMC and Acura
    • About $20.00 per click for “auto insurance” – brands including eSurance, Progressive and Nationwide
  • Payment Per Impression at a broadcast TV primetime 18-49 CPM of $35 – $0.035

Takeaway – TV has lacked the technology capacity for performance currency advertising and there’s been a strong fear of its supposed commoditization of TV ads (see my newsletter “Embrace The Click – Taking Advanced Video/TV Ads Beyond CPM”). But there’s a company in Mountain View, founded 13 years ago, that has done pretty well with performance based ads (2009 revenues of $24 billion if you need reminding). If TV and video providers want some of that “Google Money” it seems to make sense they’re going to have to make friends with performance metrics as an ad currency.

So, there’s a lot at stake and a lot to talk about regarding measurement and metrics. I’m looking forward to the panel very much. We have a set of panelists who really know measurement and metrics as it relates to advanced TV and video advertising. We’ll look at the opportunities in the space but we’ll also cover the real word friction and challenges in metrics today, and how best to address those.
I’ve copied the full panel description below. Clearly there’s a lot to cover and will we may only get to some of the topics. But I’m sure we’ll have an informative and lively discussion. I’ll report back after the panel on what was discussed.

Panel Description

Better Monetization through Better Counting: Measurement for Advanced TV and Video

As advanced TV and video platforms afford new capabilities, they also create new opportunities and challenges for measurement. Metrics can support the growth of new platforms by reflecting added value created for consumers, content distributors and advertisers. But – to adapt an advertising maxim – ”if you can’t count it better, you can’t sell it better.”

This session will look at topics in measurement for linear and non-linear TV, broadband video, mobile video, and other media/platforms. It will also look at issues of cross-platform measurement. Topics to be discussed include the current state of measurement for TV platforms including linear, interactive, addressable, VOD and DVR, as well as for video delivered via broadband, mobile, portable devices, game platforms and CE devices (including connected TV’s); how quickly progress is being made toward new metrics currencies, both for currently popular and for emerging advertising units, and what the current status is of engagement metrics; the current status of cross-platform metrics and what impact the Coalition for Innovative Media Measurement (CIMM) will have and when; the areas in which demand is most exceeding availability in measurement; the areas in which measurement advances are likely to occur in the coming years; whether the slow pace of advancement in metrics is constraining the growth of advanced video advertising; whether TV Everywhere and OTT should be measured in basically the same way as traditional TV; who owns the data and how best to measure consumer behavior across platforms without violating privacy; and how to ensure consistency of metrics and metrics standards intra- and cross-platform.

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