Aguinaldo Boquimpani - Marketers - Interactive TV Advertising
Interactive Media andInteractive TV AdvertisingAguinaldo BoquimpaniDigital TV / Interactive Media SpecialistBrazil
Agenda1. TV and Internet2. DTV in Brazil and Latin America3. Ginga: a World-class DTV standard4. TV Interactivity5. Why Interactive TV Advertising6. What is Interactive TV Advertising7. Current Offerings8. Example: Verizon Widget Bazaar9. Convergence Paths10. Multiple Screens11. IBB (Integrated Broadcast-Broadband) – real world samples12. Relevant Points
TV is…• Communication• Entertainment• Marketing Watching TV is…• A lean-back experience• A group experience• Getting content (push)
Internet is…• Information• Entertainment• Marketing Using Internet is…• A lean-forward experience• A solo experience• Seeking content (pull)
Will Internet replace TV?• Recent Nielsen’s 3 Screen Reports (USA) say that:• Internet content viewing is growing significantly• But.. TV content viewing is NOT decreasing• Use of both platforms at the same time is increasing drastically
Are Connected TVs the perfect solution?• Google TV was branded as the killer “Connected TV” solution and it was a spectacular failure.• In the connected TV scenario the broadcaster is out: TV manufacturers want a piece of the action!• Viewers may not want to search the Internet or otherwise have an Internet experience on the TV.• But… what about smartphones and tablets? They will be secondary screens in the home.
What would be the solution to integrate both worlds?• An inclusive scenario, with manufacturers (devices), broadcasters (content), sponsors and marketing (money), all in the same boat.• A platform that integrates the main TV screen and the secondary, personal screens (tablets and smartphones)• A unified user experience in all different screens• An easy user interface: usability is fundamental.• Technologies based on open standards, not proprietary solutions.
Let’s go back to the beginning• TV today means… Digital TV• How is the adoption of Digital TV and whatcan be expected?
The World Is Switching to Digital TV 1600 1400 2010 : 1200 - 42.5% digital Analog - Only Finland Homes 1000 fully digital 800 2016: 600 Digital - 80.0% digital Homes 400 - 33 countries fully digitalMillions of 200Households 0 2006 2010 2016Source: Digital TV Research Ltd., June 2011
Emerging Markets Will Drive DTV Sales In the next five years, TV set shipments will: grow 2.2% per year in Latin America, Eastern Europe, MEA & Asia Pacific decline in Japan & Western Europe be flat in North AmericaSource: IMS Research, August 2011
Free-To-Air TV Will Lead in Latin America Free To Air will Lead in Latin America 140 120 Free to Air Primary pay DTT 100 DTT will grow Primary FTA DTT faster than Analog terrestrial 80 DTH or Digital free DTH digital cable Pay DTH 60 Pay IPTV subs 40 Analog cable subs Digital cable subs 20 Millions of 0 Households 2010 2011 2012 2013 2014 2015 2016Source: Digital TV Research Ltd., June 2011
In 2016, Brazil Will Be 5th Largest DTV CountryBrazil will be #5 DTV country in 2016 Brazil
TV in Brazil PC penetration: 55% of Brazilian households(1)FTA TV: 96% of Brazilian Broadband: 18% ofhouseholds(3) Brazilian Households (2) (1) Computer Industry Almanac / IBGE (2) Telecom/ IBGE (3) WWW.eletros.gov.br
DTV in Brazil Quick view: still a long way to go, but advancing fast - Highlights 3,00 2,00 Total current number of TVs: 100M+ 0,30 Coverage: Around 65M householdsiDTV 3,60 More than 13M TVs CRT sold on theLCD/PLASMA 4,30 last 3 years not equipped to receiveCRT DTV Around 7M LCD/PLASMA TVs sold 8,00 before 2010 not DTV-ready. 4,90 3M+ LCD TVs already sold with 4,00 Interactive System (Ginga). 2008 2009 2010E Source: 2008 and 2009 (SUFRAMA) / 2010 (estimate) (*) in millions of units
DTV adoption in Brazil State penetration: 23 of 26 states (1)Cities: 47, 23 capitals (1) Broadcasters: 100+ broadcasters, including headends and affiliates (1)(1) http://www.dtv.org.br
ISDB-T adoption in LATAM Population: 354 Million in LATAM (2) 11 countries in LATAM + Philippines in Asia (1)(1) http://www.dtv.org.br(2) http://pt.wikipedia.org/wiki/ISDB-TB
Ginga: A World-Class Interactive DTVStandardGinga, the Brazilian Terrestrial Digital TV System interactivity standard, is part of ISDB- Tb (ISDB-T Japanese standard, Brazilian version) that has been adopted for terrestrial and mobile DTV in 11 countries representing over 350 million people, including Brazil, Uruguay, Peru, Argentina, Chile, and Venezuela.Ginga is a modern, world-class interactivity system that was recognized by ITU (the United Nations agency for Telecommunications and TV Standards) as an international standard.Today there are more than 3M TV sets in Brazil already deployed with full Ginga products from brands like Sony, Panasonic, Philips, LG and Samsung.Source: http://www.dtv.org.br
Brazilian Government: TV Interactivity and Ginga are key technologies to the country LCD TVs will have to include Ginga to keep tax breaks Convergência Digital :: 23/09/2011A change to the Processo Produtivo Básico (PBB) is in public consultation for TVsets with liquid crystal display (LCD) that will require inclusion in these devices ofthe DTV interactive middleware, Ginga.In other words, manufacturers who wish to continue enjoying the tax benefits forthe production of these devices will have to incorporate Ginga mandatorily. Underthe proposal, until the end of next year 75% of the devices must come with themiddleware.Starting in 2013, all LCD TVs benefiting from the exemptions will have to includeGinga. Moreover, it is prescribed that all models that support IP connectivitymiddleware must not have the possibility of access restrictions on interactiveapplications for the communication channel.http://convergenciadigital.uol.com.br/cgi/cgilua.exe/sys/start.htm?infoid=27802&sid=7
Why Interactive TV Advertising Interest is Growing inInteractive TV Advertising
Why Interactive TV Advertising Who already offers interactive TV marketing in the world?Source:http://www.broadcastpapers.com/whitepapers/BCA03OpenTVInteractTVRevenues.pdf?CFID=21858164&CFTOKEN=3aa7c6e72bbe30b5- 289B26E406-B5EE-1EC3-1BC7B19C0C3F7D4D
Why Interactive TV Advertising Modelo de Comercialização de Interatividade na TV Who is already sponsoring Interactive TV marketing?Source:http://www.broadcastpapers.com/whitepapers/BCA03OpenTVInteractTVRevenues.pdf?CFID=21858164&CFTOKEN=3aa7c6e72bbe30b5- 299B26E406-B5EE-1EC3-1BC7B19C0C3F7D4D
Why Interactive TV AdvertisingInteractive TV Improves Advertising ValueMakes TV Advertising More Measurable & Accountable Traditional commercial spots are not nearly as valuable in homes with DVRs Q3 2009: In Tivo households, 39% of programs were time-shiftedAddresses, Engages & Empowers the Consumer Transforms TV ad messaging into a lean-forward experience with scale, customization, addressability & localization Consumer chooses when and how long to engageDe-Clutters the Ad Environment Offers a rich, singular brand experience that cannot be replicated with commercials or online advertising Source: IAB Platform Status Report, Interactive Television Advertising, Feb 2010
Why Interactive TV Advertising Interactive TV Advertising is Effective Canoe Ventures Study on Interactivity & Advertising (March-Sept 2010)Goal: - Measure impact of interactivity on brand metrics - Measure recall, opinion, purchase intentScenario #1: “Request for Information” (RFI) - An interactive call to action during a TV commercial - A request for a product sample, a coupon, or informational brochure - Viewer simply uses their remote and “clicks” to receiveScenario #2: In-Program Poll - Advertiser-sponsored interactive poll or trivia quiz - Poll displayed during program, then followed by commercial
Why Interactive TV Advertising Interactive TV Advertising is Effective ResultsInteractivity improves brand recall - RFI in commercial increased unaided recall of test brand 132% - Unaided brand recall rose 167% for interactive poll following adInteractivity results in a higher brand opinion - Favorability increased in viewers who noticed interactivity (42% to 51%) - 91% who accepted offer had “a more favorable opinion about the brand”Interactivity increases purchase intent - Interactive Poll + commercial raised brand purchase intent scores 40% - Just noticing interactive ad without clicking raised purchase intent
What Is Interactive TV Advertising “Entry Points are the place within the TV viewing or Entry Points interactive experience where the viewer is first exposed to the interactive advertisement.” Main Menu Banner Interactive Tags in Commercials (a.k.a. Triggers) Interactive Guide Banner Pause/Delete Screen BannerSource: IAB Platform Status Report, Interactive Television Advertising, Feb 2010
What Is Interactive TV Advertising Destinations / Capabilities “Destinations are the follow-on engagements that Examples the consumer experiences once they have initiated Branded the interaction. Showcases/Microsites (a.k.a Dedicated Advertiser Technical Capabilities are applications or Location/Virtual Channel) functionality that can be interacted with.” Branded Theme Promotions on Demand Broadband/VOD Sponsorships Click to Call Customized Applications / Games / Commerce Lead Generation Capability (a.k.a. Request for Information (RFI)) Survey/Voting/Polling Telescoping to VODSource: IAB Platform Status Report, Interactive Television Advertising, Feb 2010
What Is Interactive TV AdvertisingDestinations / CapabilitiesSource: IAB Platform Status Report, Interactive Television Advertising, Feb 2010
What Is Interactive TV Advertising Destinations / CapabilitiesSource: IAB Platform Status Report, Interactive Television Advertising, Feb 2010
What Is Interactive TV Advertising Destinations / CapabilitiesSource: IAB Platform Status Report, Interactive Television Advertising, Feb 2010
Use case: Verizon Widget Bazaar Verizon: Widgets are Key to AdvertisingVerizon, the US quad-play provider, is focusing its advanced advertising attentions on itsVerizon Widget Bazaar...Tellingly, the TV apps platform is a much bigger priority thanadvanced VOD advertising like dynamic VOD ad insertion....A good example of the advertising opportunity with the Widget Bazaar is provided byVictory Motorcycles, which includes video about its products that amounts to a televisionbrochure, plus a gallery of product photos. This is complemented by an interactive dealerlocator that presents the nearest five dealers to a viewer, based on their ZIP Code. Viewers canalso request a brochure to be emailed to them. All the apps within the Widget Bazaar willbenefit from the fact that Verizon can use its own 30 second advertising spots to promote theconcept and make sure consumers know the applications exist.… “I would argue that our widgets provide the most advanced dedicated advertiserlanding page available in the US today,” Jason Malamud, General Manager of Verizon FiOSAdvertising declares. “Advertisers can pull video from our VOD servers and they can pull textand graphics from web servers so they can be dynamically updated. They can offer interactivefeatures like a dealer locator [for car dealers, for example]. That information is not sent to usseparately but is available from the advertiser so data can always be fresh.” Usage data canalso be delivered straight back to the advertiser.Source: "Verizon focuses on widgets-based advanced advertising", John Moulding, Videonet, 10 Nov 2010
Use case: Sky Active SKY ACTIVE SKY Active is a model of Interactive TV launched in the UK and Ireland in 2001. Business models for interactive marketing: • Interactive Airtime – it is the transmission time used to exhibit an ad associated to interactivity, which is accessed inside the context of the video content. • Interactive Airtime Premium – It is an additional fee which enables an interactive spot in the video content. The price depends on the number of insertions but only households that support interactivity pay for the insertions. • Hosting Charge – Fee to store and transmit the interactive content.Source: http://www.t2dgroup.com/downloads/Guide%20to%20Interactive%20TV.pdf 39
Connected TV shipments to exceed 138M in2015 Source: DisplaySearch Q2’11 Quarterly TV Design and Features Report
5 Reasons why Connected TVs can be a flop1. The Internet on TV Sounds Confusing (to the user) For average consumers, the thought of hooking up the Internet to their television set sounds confusing. Many wonder what they will have to do to make a smart TV work2. The Internet on TV Is Confusing They want to watch their new television without a call to tech support, and that is understandable. Delivering products that are simple to set up and easy to use should be a main concern for television manufacturers.3. Fear of Obsolescence4. Customer Support Concerns5. Poorly Defined Value Proposition Most Smart TVs are being touted for their technology rather than the benefits they provide. Source: http://mashable.com/2011/01/11/smart-tv-flop/
Where is the convergence?• This is the true question.• Most of Internet scenarios will not be successful in the TV screen and for the TV lean-back experience.• Convergence then can really exist including: – Different ways and places to consume content – Interactivity on TV and multiple secondary screens – Interactive advertising – Rich content – Integration between all of the features above
Caminhos de Integração: Múltiplas TelasConnected Devices and Multiple Screens• There is a growing offer of broadcaster’s applications on tablets.• But apart from accessing the same content, what can the user do?• There is currently no integration between TV and devices. This huge potential for the simultaneous and complementary use of TV and devices is still not explored by broadcasters and the advertising market.
Caminhos de Integração: Múltiplas TelasConnected Devices and Multiple ScreensWith a convergent model that includes interactive services a hugehorizon of possibilities is opened in the Connected TV home: • Changing content viewing from the TV to the device, with access to a rich interactive content interspersed with sponsors information, product marketing etc. • Direct real-time feedback from the user to the broadcaster and to its sponsors using the broadband channel when present. • Same user interface and user experience.
Paths of Convergence: Connected TV + GingaTwo worlds that complete each other. It is not a battle for the home screen anymore: – Linear content viewing can be transferred from the TV to the device. – Non-linear content can be accessed on the device or on the TV. – For the majority of the broadcasters this will mean converging existing solutions. For manufacturers this will mean revenue- sharing models with broadcasters and their sponsors.
Relevant Points• Internet and traditional TV are not about to battle for the home screens.• They are about to converge and integrate, enabling seamlessly unified user experience across different screens and enabling the viewers choice and freedom.• There is a huge potential to explore Interactive TV scenarios using standardized and open solutions like the Ginga standard for Interactive Digital TV.• Content is king and marketing will always be about selling a good product within a rich content experience.• Welcome to the new TV!
ContactThank you! Aguinaldo Boquimpani Consultant Digital TV Media Interactive TV Mobile Media Technology email@example.com http://br.linkedin.com/in/aguinaldoboquimpani