Satellite Explores Interactive Spots

May 9, 2005  •  Post A Comment

Fresh off a campaign for Mercedes-Benz, EchoStar’s DISH Network plans to fire off a round of interactive ads later this quarter for BMW’s new 3 Series. The satellite operator will roll out the car ads across its interactive-enabled set-top boxes, reaching more than 10 million DISH Network homes.

The ads will be similar to those in the Mercedes-Benz campaign that ran in March and allowed viewers to request a brochure, schedule an appointment to test drive the 2006 M-Class or watch a long-form video about the car.

After several years of promise, interactive TV advertising does indeed appear to have finally materialized. That’s good news for an advertising business eager to experiment with new shapes and sizes of ads to engage consumers in a more meaningful fashion.

In addition to DISH Network’s push, DirecTV introduced its advertiser ITV development program last month with Chrysler onboard as its first client. Several cable operators also have peppered their footprints with interactivity. Cox offers enhancements to 30-second spots in some markets, while Time Warner proffers telescoped ads that link a 30-second spot to a long-form ad.

The revenue generated from such deals is small at the moment, but interactivity can make ad dollars more valuable in a business where viewership is shrinking, said Ted Henderson, senior VP of equity research for cable for Stifel Nicolaus in Denver. “We call it interactive advertising today, but 10 years from now it will just be called advertising,” he said.

The DISH Network ads, using Open TV technology, rely on “triggers” in the advertisements that serve as entry points to escort consumers into an interactive channel. Once there, they can view a long-form ad or request more information. “The technology is throwing a web across the interactive ads, the 30-second spot and the long-form spot and bouncing consumers to where they want to go,” said David Rudnick, chief operating officer of Turner Media Group, the ad rep firm for DISH Network.

As DISH Network continues its interactivity expedition, DirecTV is hunkered down in discussions with Chrysler on the shape its ITV ads will take when they debut as scheduled in September.

The content needs to be high-energy and rich in product information, said Julie Roehm, director of marketing communications for the Chrysler Group. Possibilities for the Chrysler ads include a 30-second spot jumping to various pieces of long-form content to allow viewers to construct a car or steer a Jeep over mountain or snow. Immersive gaming is another option. The long-form content will be stored either on the consumer’s digital video recorder or in a portion of the satellite capacity that’s reserved for long-form ads.

DirecTV will provide Chrysler with measurement information such as the number of people watching the shows with the ads in them and the number of viewers who clicked to request more information, Ms. Roehm said.

“Interactive advertising is a real priority for us,” said Eric Shanks, senior VP of advanced services and content at DirecTV. That’s why the company developed the DirecTV Advertising Development Partner Program to launch ads that customers will be able to view on its set-top boxes, its new DVRs or the new DirecTV Home Media Center. DirecTV will house three to four advertisers in its program but has not named the other players besides Chrysler. Mr. Shanks added that the satellite company is in the process of incorporating the interactive platform into its set-top boxes. Categories best suited for the program are theatrical, video games, consumer electronics and packaged goods, he said.

Satellite operators have been dubbed the leaders in interactivity because of the work their counterparts have already done in the United Kingdom and other parts of Europe. Also, satellite does have the advantage of a national footprint for interactivity as well.

However, most in the industry think cable draws the trump card with its two-way network and return path to process the interactivity. Satellite uses the phone line for a return path.

But cable operators are new to the ITV ad space and haven’t had much opportunity to leverage the potential of the two-way network. “Cable operators are just now beginning to develop some interesting two-way interactive applications,” said David Porter, director of new media for Cox Media.

The two-way network is an advantage when it comes to ads that need an instant information exchange, said Ben Mendelson, president of the Interactive TV Alliance. “Otherwise, [cable and satellite] are fairly similar,” he said.

DirecTV’s Mr. Shanks said the phone line is “perfectly suitable to transmit any return path data back to the headend.” Subscribers who don’t have the box plugged into the phone line would be prompted to do so when they attempt to engage in the interactivity.

Research has shown that regardless of the platform, viewers are six times more likely to interact with an ad if it’s part of an interactive TV program, said Scott Newnam, CEO of ITV firm GoldPocket Interactive. He expects broadcast and cable networks will launch more interactive programming options this fall, backfilling commercial pods with interactive messages.