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Jan 23, 2006  •  Post A Comment

Interactive television technologist Navic Networks plans to introduce a slate of interactive ads for Hyundai and Midas in four local cable markets over the next few months that represent a significant step forward for the interactive advertising business.

The ad buy was engineered by the brands’ media agency Carat, which asked its local buying offices last fall to find interactive advertising opportunities. The current interactive deal comes from local buyers in Carat’s regional offices in New York, Atlanta, Los Angeles and Chicago. The new ads will be built on initial research Carat culled from a series of interactive spots for Hyundai that ran in Cox’s Phoenix market last year.

The four-market deployment is noteworthy because it’s an investment across more than one market and because it suggests advertisers are taking interactive advertising more seriously, since they will apply prior field research to craft the spots and the details of this new buy.

Carat’s Road Show

The current buy grew out of Carat’s so-called “road show” last fall, which was meant to educate its regional buying offices about the interactive, enhanced and new media ad opportunities with local cable. The road show’s goal was to create the framework to allow Carat to place more of its clients in new ad opportunities-such as video-on-demand, addressable advertising and interactive spots-during the local upfront.

This multimarket buy is the first result of that effort. It consists of Hyundai spots in Albany, N.Y., on Time Warner, Phoenix on Cox and in Tampa, Fla., on Bright House. Midas will run spots in Albany too, though the buy came out of Midas’ planning group in Chicago.

“Car dealers are local broadcast advertisers and we need to find something sexier to separate them from the competition,” said Mary Barnas, executive VP and director of local broadcast for Carat. “We need to find some innovative ideas for them that go beyond their regular spots. … It shows the client why they should stay in local broadcast.”

Carat will fine-tune this next set of spots based on research it conducted last summer in Phoenix that found networks with viewers whose median age is below 40-such as TBS, VH1, MTV, MTV2, Spike and ESPN-generated the most responses to the interactivity embedded in the Hyundai ads. Carat will use that data to determine which networks are most appropriate for branding and interactivity, how many spots to run and the number of impressions per network.

“We will skew more toward networks where viewers are more responsive to the Navic technology,” said Mitch Oscar, executive VP of Carat Digital.

The research also indicated consumers interacted more frequently when the interactive portion appeared for the commercial’s full 30 seconds rather than for just part of the commercial. As such, the new spots will have the interactive overlay up for their entirety.

Carat will also arm the local Hyundai dealers in each market with tools to follow up on the requests generated by the interactive spots. Because the dealers had mixed opinions about the effectiveness of the first slate of interactive spots in Phoenix, Hyundai wants to be more specific and timely in its follow-up with potential customers this time, said Robert Petizon, VP and group account director for the Hyundai Dealers Association at Carat. He said the goal of the interactivity is to lure consumers into the dealership for a test drive, a critical step in selling them a car.

Local Willingness

In its spots, Midas plans to test different price points and products by ZIP code to see which generate more clicks, Mr. Oscar said.

Given the involvement of the various local offices, the multimarket approach and the application of prior research, this new buy represents a meaningful advance in ITV, Mr. Oscar said.

“Everyone along the food chain is buying into some part of it,” he said. “It doesn’t suggest the client’s million-[dollar] budget will go into ITV, but there is willingness from local people to engage and willingness from clients to understand, and willingness from cable operators [and technology companies] to work with us and willingness from everyone to be public about it.”

Carat will share the results of this next series of ads during the Carat Exchange, a quarterly think tank the agency hosts that includes cable and satellite providers, technologists and programmers interested in interactivity.

Later this quarter Navic will introduce its new Hypercast technology, which will allow advertisers or agencies to place an interactive buy across multiple cable operators and markets. That capability will make it easier to scale the ITV business as more advertisers buy in, said Tom Walsh, senior VP of Navic.

Navic is deployed in more than 30 cable markets, including Los Angeles and New York.

Further investment in interactive spots is critical for the television industry, said Robert Norcross, a VP for technology consulting firm Capgemini. “Interactive advertising will be the key source of growth for the cable industry and TV more broadly,” he said.

Cable companies will reap most of the benefits of interactive advertising. The ability to target, tailor and track ads to households and individuals-a capability that the two-way cable infrastructure enables-will be used with increased frequency, he said. Down the road, cable companies should be able to track which ads have been shown to which households, helping to minimize waste and achieve reach and frequency.

“Interactive advertising is a great growth vehicle,” Mr. Norcross said.