The Death of the 3 Minute Ad Break
The three minute television ad break will not exist in fifteen years time. Why? Because it will be too easy to avoid sitting through the ads. In five years time, it won’t be an issue that your program is being disrupted every ten minutes with a three minute ad block. It will be online immediately after it is shown on telly and you will be able to download it in less than one minute with the ads excluded. Or you would have recorded it with the device that takes out the ads. That’s the problem for television networks.
Does that mean television is dead? Absolutely not.
Instead, TV stations will have to look at other methods to generate revenue. As per the current situation, this will include in-program tie ins, interactive competitions, scrolling signage and program rights. However, I believe television’s primary revenue source will be through applications. We’ve seen the iPhone and Firefox steal market share on the basis of applications and we’ll see it with television.
The next two to three years will see the integration of online capabilities into our television sets. We’ll be able to check our emails, talk to friends and browse online while watching television – all on the one device. This is the opportunity for television networks.
Television networks will start offering viewers a choice of applications (widgets, plug-ins or add-ons) which will enhance their viewing experience. Viewers will choose which applications they want to add to each program or style of programming, how they are positioned and the depth of information coming through. By this stage, each household user will have their own TV log in which saves their personal settings.
The applications will be constantly online and update in real time. The television networks will be able to sell off the applications to the highest paying advertisers or encourage advertisers to create their own applications. Either way, the network will have to approve the use of the application with their programming. Advertisers will be able to link through to their own site, engage in real time dialogue with viewers and measure eyeballs and activation accurately.
Here are examples of widgets which could be included in various programming:
News: Sunrise
Sponsor the time and the date, show local weather, have emails update on screen, display a map of traffic problems, list public transport times and delays in your area, open diary of events for the day, have feed of local news only…
Sport: Rugby League
Sponsor scoreboards, show highlights miniscreen, feed game statistics, list live betting odds with ability to place bets, instant message sport buddies, watch fantasy points add up, buy tickets, order pizza, live scores from other games or sports…
Reality: MasterChef
Display links to recipes used on tonights show, scroll all related Twitter hashtags, explain individual ingredients, show where supermarket specials are on, give handy kitchen tips, deliver program gossip…
This does not even come close to a comprehensive list of applications which could integrate with the television programming. And the options are only going to increase as the technology develops and the web becomes even more social.
What do you think? Are television applications a viable replacement for the three minute ad break? Are there any other TV applications that you would want on your screens?
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Great insight and examples of the way it could work. Interestingly though the networks are surprisingly slow to embrace the kind of stuff you’re describing. With shrinking revenues I guess though the motivation to move forward and consider new and more engaging ways will emerge and out.
Great post on something I’d never really thought about before. While ’sponsored applications’ are a great way for brands to stay relevant in the future, there are a lot less tv programs (although this may too change in the future) and screen real estate for all these branded applications than there are 30-sec spots.
Also interesting to consider that while sponsored applications could be great for Campbell’s and Weet-bix etc, what about opportunities for local brands, such as XYZ Credit Union or Tom’s Carpet? Can’t see them having the ability/bucks to sponsor the MasterChef Twitter feed, so where do they fit in?
@ Kevin I agree they are a bit slow off the mark. While the TV set technology isn’t there yet they could certainly be embracing it online (just look at the tweet popularity of MasterChef!).
@ Prue That was my first thought as well – how are they going to make the revenues of traditional TVC’s? I believe they can charge a premium on these technologies as they will be more engaging, trackable and on screeen longer. But I agree, it will take a while before revenues match up.
I think there is actually greater scope for local brands. For example, if I’m in Brisbane and want a weather app I only want the weather for Brisbane so here is the chance for a local company to sponsor this app. The beauty of the apps is that they deliver only information that you want meaning it can be localised and personalised to the tiniest degree. It may mean that the stations develop an app (eg. a weather app) and then sell off postcode sponsorships to different advertisers. We are no longer limited to signal zones.
@Nathan … I agree re: Prue’s question about local advertisers. Local advertisers can afford to advertise now on the TV and even though a show is national the ads are local. Applications shouldn’t be any different. The TV station will just need to provide a base application for local businesses to take advantage of.
BTW – As if the Raiders would ever be winning 32-2 after 48 minutes. You’ve had too much sun on your melon up their in Qld
Interesting debate, but I think we’ll see the 30 second ad in some shape in the future. After all, it adds huge equity, personality, story-telling to a brand – more than these applications could hope for.
I can’t help but think these applications would prove as annoying and intrusive as those banner advertisements that grow take over the news pages; the ones that disrupt our viewing.
As you say, it’s an option – one option among many – and viewers will go elsewhere. Either to a place where content is ad-free, or where it isn’t thrust upon them during viewing (e.g. if you want to watch a video from overseas on the BBC website you need to watch a 30 second ad before it begins).
The main point I take from the post is that piracy isn’t only hurting the movie and music industries.
Would the options with applications, and on screen advertising produce enough revenue to cover for lack of full 30 second adverts?
Also, the ideas above are of course limited to the people who upgrade. When the analog signals are shut off, we’ll see that upgrades in technology don’t mean much to a lot of the population.
In 15 years, will we still be sitting in front of a television? Or will we all be blogging, while watching out favourite shows in another window online. Enter the world of online advertising?
@Daniel – Good point about TV stations having to facilitate it for local advertisers. Bad point about the Raiders.
@Johnny – It’s true that 30 sec ads show much more personality. However, I think it will force brands to be more entertaining and relevant eg. create content outside the realms of 30 sec that people choose to watch, participate in, enter into, discuss etc. Very true that they could become annoying but because they are options, I believe that only the relevant ones will be popular which means the most ad dollars. Hopefully this should filter out the junk!
@Bailey I think this is the next step after analog/digital conversion. This is the online/streaming conversion which will be next. It will no doubt take a while for it to reach the 30 sec ad rev but like you say they will have no choice when it’s all available elsewhere. ILive TV may be the only saviour! I reckon we’ll still be in front of a TV but we’ll be able to browse just as well from our TV as from our comps.
i’d prefer ad breaks than all that annoying sh*t on the screen. These apps would do my head in. Please remember people under 28 consume media … I can’t see a 40/50/60/70 year old digging on twitter hashtags and widgets when they’re trying to watch 20 to 1. Not everyone has the energy to lean forward, participate, ‘join the conversation’ etc
What makes people think the 30 second ad spot is dead anyway? Provide some local data around this. People are still watching TV, they’re spending more time with it than they were 5 years ago and strong programming rates well and holds audiences. Doesn’t to me seem like the 30 is killing anything.
Plus how does this approach scale, especially with regional TV and the advertisers that keep it alive (ie local traders)
All the data I have says it’s still influential and serves the purpose of most advertisers. Plus – mash up apps etc aren’t going to cover the billion dollar plus overheads of providing the quality of entertainment we get on TV.
TV influences search – bigtime. Bigger than anything else in my experience working across $40-60m ad spenders who invest big in all channels. With more addressability TV will become as nimble and targeted as online.
I’m all for debate, but there has to be more for the digerati to talk about than the death of TVCs.
btw i’m not intending to sound patronising above … it’s just a topic i think that requires a lot more debate.
@Ben – I knew a headline about the “death of …” might draw you in!
You make some really valid points. I think what is important to remember is that I’m talking 15-20 years down the line. I’m not seeing it happen next year. So, in that time our 28 year olds will be in their mid forties and not the passive audience we have now. Also, technology will have leapt forward dramatically. Who knows what the fad of the day will be? I believe that there will be no thing as seperate TV time and computer time, they will be integrated experiences on one device.
I’m not saying apps would be the only revenue source, they will be one of a few. However if technology allows me to access a whole series of Entourage, easily downloaded in no time on a much higher download limit (which it will) – I’m not sitting through 15 minutes of ads every hour. TV stations will have to find better ways to make $ than relying on these blocks (and we know taking pirtates to court won’t help). This is especially true as the next gen of media planners/buyers move through the ranks and start questioning the validity and effectiveness of ‘tarps’ and start talking ‘experience’ and (ugh) ‘engagement’ of brands.
The apps would be your choice. You could have 50 on screen or you could have none. If the app is good enough and the show is engaging enough you’ll want more apps to magnify the experience. Re scale, see previous comments. Apps would allow access to localised, personalised info meaning even more targeted advertising.
I wouldn’t really consider myself ‘digerati’ – I have a TV planning and buying background and still buy TV for a couple of clients. I’m a big believer that trad media still has a huge role but there are shifts that are going to take place which are better to be thought about now because they will have to be implemented fast.
You’re absolutely right about requiring more debate. Already the questions in this post have helped carve out my perceptions on how it could work. There’s a good chance that I could look back on this in ten years and laugh at the concept – but the debate and thought provoking will be worth it!
absolutely nathan … the debate is great as I have an opinion but know that often I am wrong so am always open to talking through what the future might hold.
i think addressability for TV is a real opportunity. Mix this with on demand longer form video and it will absolutely change the way we use the 15/30 format and bring it into a more ‘dynamic’ space.
the idea of addressable, targeted (both on demo and consumer info as well as behavioural and habitual) TV is a cool one. I think it brings the good of TV advertising (impact, quality) with the good from digital (targeting, reporting, technology) to deliver more relevant output for consumers and also advertisers.
do also agree that if apps are user selected they could be exciting. if i could add a stats widget to afl/nba games i’d definitely jump at it. And things like a Twitter stream for shows like Top Model or Masterchef or Idol I can imagine would work well.
Great mock-ups, I definitely agree that there’s a lot of scope for this type of thing. I reckon the real opportunity for advertisers goes way beyond sponsored twitter feeds – it’s about relevant apps that actually shift units.
The potential for a show like Masterchef is huge – those Coles widgets could not only provide viewers with recipes in real-time, they could create a one-click shopping list that delivers all the necessary ingredients to your front door.
But I also think Ben Shepherd makes a good point about intrusion. A previous company I worked for did a load research into Video On Demand ads, and pre-rolls performed significantly better than on-screen messages during the shows.
Ultimately it comes down to context – widgets will prob work better when you’re watching the cricket than if you’re trying to lose yourself in a movie or yet another season of 24.
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Another Advertising Wanker
Nathan Bush
Digital Strategist at DP Dialogue
Brisbane, Australia
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