Advertisers’ thirst for digital advertising opportunities heading into the 2007 upfront television ad market can be measured by their willingness to do it themselves.
Case in point: Two major advertisers are bankrolling a series of made-for-the-Web episodes starring legitimate, old-school TV talent in the form of “King of Queens” star Leah Remini. The “Motherhood” Web series, created by MindShare Entertainment for clients Suave and Sprint, will feature professionally written stories submitted by real-life moms.
Broadcast and cable networks are gearing up to cater to advertisers’ infatuation with digital media during the upfront, which begins this week in New York. Last year the networks, particularly NBC, focused on serving digital accompaniments to their shows, but digital dollars represented only a small percentage of the networks’ take.
“Last year was a lot of talk and some action,” said Tracey Scheppach, VP and video innovation director at Starcom. “There’s more there this time around.”
This year television networks will be pushing even harder, and Merrill Lynch analyst Jessica Reif Cohen predicts that digital sales will represent about 5 percent of upfront revenue, compared with 2-3 percent last year.
Networks this year are expected to sell ads in the full-length episodes of the shows they stream online during the upfront. Ms. Scheppach also expects the networks to sell video-on-demand more aggressively than in the past and with more interactive applications.
At the same time, online portals such as Yahoo and AOL are making upfront presentations to try to snatch dollars that otherwise might be earmarked for TV. It’s all part of the free-for-all resulting from consumers’ changing viewing habits and advertisers’ demands for more effective ways to pitch their products.
Last year the broadcasters’ digital properties had little reach, making it hard for them to compete when clients wanted to reach a specific demographic, said Michael Hayes, senior VP and managing director of Initiative Interactive. This year it should be more interesting. Working with a network makes sense “if you want to own a piece of programming,” he said.
Mike Pilot, president of sales at NBCU, expects discussions of digital advertising to be ubiquitous.
“It’s in every discussion we have with our clients,” Mr. Pilot said. “But I also see the discussion evolving a little bit. A year ago [it] was digital and analog or new media and traditional media, and now we seem to be talking more about video advertising.”
The drive to cater to advertisers’ tastes for digital marketing is reaching beyond the upfront to the premier old-school TV commercial stalwart: the Super Bowl. News Corp.’s Fox Sports and social networking Web site MySpace are teaming with the NFL to provide advertisers with built-in digital components to their Super Bowl commercial buys. The initiative will let sponsors purchase spots in the game that also play on MySpace.
David Cassaro, president of Comcast Network Sales, said that three years ago, one of every 10 deals had some sort of a digital extension to it. Now, he said, it’s 50 percent.
“The big talk in the market is how much money migrated over to digital a year ago,” Mr. Cassaro said. “I don’t think you’ll get any agreement from anybody about what that percentage was. We know one thing for sure. That percentage is going to grow this year.”
He said advertisers looking to do digital deals with television networks often find the TV people can’t aggregate enough eyeballs. Comcast has shown it can, he said. Its Fear.net horror channel on VOD and broadband is drawing 6.7 million video streams a month.
Advertisers such as Toyota’s Scion, Microsoft’s Xbox, Dodge and Johnson & Johnson have bought packages on E!, Style and G4 that include linear, VOD, broadband, mobile and podcasting. “Put all the pieces of the puzzle together and all of a sudden you’re aggregating a lot of eyeballs that are very targeted and are interested in the content.”
Beyond working with networks to create digital opportunities, advertisers are getting into the production game to reach consumers more directly.
“With technology and broadband passing critical mass, it has allowed marketers and creative types to create and produce engaging content that reaches consumers in very different ways,” said David Lang, managing partner for MindShare Entertainment.
Mr. Lang says that the Web environment produces a different type of engagement with consumers than a TV commercial.
Last year, MindShare produced a series of webisodes for Dove soap starring Felicity Huffman and directed by Penny Marshall that drew almost 4 million visitors to the Web site in less than eight weeks.
“That is somebody typing in a Web site, or clicking on a link and interacting with that brand and with that entertainment in a very intimate and personal way, and that’s tremendous engagement versus watching TV and seeing a commercial,” Mr. Lang said. “They’re both good and they’re both powerful if done right. They’re just different ways of reaching consumers.”
MindShare’s “Motherhood” webisodes appear on MSN, Sprint phones and Suave’s Web site.