Rebecca Weeks reports on the reality of advertising, cross-over and distribution strategies in today's entertainment landscape.
The Digital Hollywood conference in Santa Monica began on Monday as it always does: with overflowing rooms and kid-in-a-candy-store enthusiasm. The regular top decision-makers from Hollywood, Madison Avenue and Silicon Valley attended to discuss tangible revenue channels for the digital entertainment industry, as well as those with future potential.
However, this year, executives seemed more realistic about the power, capabilities and challenges of digital media. Unlike last year's mass hysteria, I only heard the phrases "death of the thirty second spot" and "consumers are in control" mentioned twice.
The session entitled "Advertising Strategies in the Diversified Digital Culture," discussed the challenge that advertisers and their agencies face in deploying new digital platforms and technology. Broadcast, cable, satellite, broadband, games and mobile industries are all feeling the complicating effects.
Moderator Gigi Johnson, principal at Maremel Partners, started the dialogue by noting that our marketplace demands precision and newly designed strategies to ensure that messages stay relevant. After stating that two-way media has broken ground, she asked panelists to highlight the changes in advertising in the past 18 months.
Another speaker -- a man who was selling digital innovation before the market was ready -- was Todd Herman, director of media strategy for MSN Video. "I started selling streaming video in 1997. It looked sexy but no one wanted to try it. In the past 18 months, I've seen enough companies that want streaming video to know this is going to be huge. I'm constantly surprised that broadcasters haven’t looked at how cash flow has changed. In the future we'll see the death of concurrency -- we won't be doing the same things any more," said Herman.
"Commercial breaks seem absurd to consumers, so what we're going to see is advertising moving back to the development of rational messaging," said Rob Norman, CEO of Mediaedge:cia. "Consumers need to be emotionally engaged, encouraged to interact and compelled to transmit messages to their community."
David Ernst, director of futures and technologies at Initiative Worldwide, believes that multi-dimensional fractionalization is advertisers' biggest challenge. "There is an expectation that consumers have that they can control their media experiences. Advertising is now competing with programming. But I don't agree with Todd that we will no longer have mass media experiences like the Olympics," said Ernst.
Tracy Dolgin, president and CEO of YES Network pointed out that consumers aren't the only ones who have expectations: advertisers expect answers from their partners and are frightened by this dynamic marketplace. "People are panicking to get into new media. They want answers. No one has them all. Everything I know about new media I learned through BSkyB," said Dolgin.
Panelist Chris Pizzurro, vice president of multimedia marketing at Turner Broadcasting System, Inc., agreed, noting that sellers have to come to the rescue. "I've seen an increase in proposals from ad agencies and clients to learn what creative opportunities are available in the digital space. There is a steady stream of new and recurring clients. Learnings fall on sellers like Turner and other networks. We have to make it as easy as we can to embrace new concepts. We need new back room systems, so this change isn't going to happen overnight."
Microsoft's Herman said, "We have a tendency to run over ourselves because we think that just because something can be done it should be done. We can't assume that technology drives media. Consumers drive media."
As the distribution of advertising is changing, so too is the content. Just because advertising relates to a product doesn't mean that consumers will care about it, Dolgin said. Marketers have such short time periods to connect with consumers -- such as three seconds in a banner -- that messages now need to be simpler.
Panelists were enthusiastic to discuss some of the new advertising concepts, like branded entertainment.
Pizzurro highlighted the Crossfire and Xerox partnership. "Xerox wanted to change its old stodgy image, so they invested in Crossfire Interactive in which consumers could play along via cell phone, TV and the internet. It worked on two levels: meeting branding objectives and meeting direct objectives -- retrieving names and information."
As cross-platform deals are becoming more valuable, media sellers are driving the charge. But relevant integration is the key, said Norman. "The brand and programming must have combined value. For example, Citigroup and 'Hope and Faith' teamed up. The show's writers' established a plotline that was centered around identity theft." Norman went on to say that, "a campaign I love, which is not my own, is 'Real Women.' Ogilvy and Mindshare developed it for Dove. The brand took a position, instead of a positioning. This creative freedom is provocative. It is designed to counter the fragmentary effects of new media. It allows people to take a deeper dive into emotional engagement."
Although advertisers admitted that digital media cannot solve all of their problems, they readily appreciate its many benefits.
"Digital works well because it's immediate and the production cycles are shorter. But coordination might be more difficult," said Pizzurro.
Panelists agreed that interactive media can achieve both branding and response goals.
Norman said, "Every brand will have to allow consumers to interact with it. Direct response should not conjure up the old Bowflex TV ads. Direct can mean new things. Consumers will go deeply with a brand if they share an emotional experience with it. For example, digitally connected Moms are creating virtual communities and transmitting attitudes about marketers. If we don't educate them, they will tear us down."
While most brand marketers understand interactive marketing's promise, Microsoft's Herman told the audience that they'd be shocked to know that a top 20 brand just last week bought its first online ad. "Marketers want to maintain a hold onto traditional media, because they know that new media is not all diamonds," he added.
"What's important going forward is how intently people are watching, not how many," Dolgin said. "It's a crime that measurement has not caught up to where it needs to be."
Ernst was vocal about these measurement needs. "Smart companies will work to give us local measures. Even if Nielsen had a perfect measurement system, we still can't rely on commercials to understand what consumers are doing. We need new and fair ways of measuring the impact that mediums have."
Herman suggested that we first need a naming convention, but the barrier is getting people to agree and work together on this without a profit in the short-term.
Digital media has certainly made our industries more complicated. However, it is a small price to pay for the reward of connecting more closely to consumers' lives.