Online viewing radically alters ad placement dynamic

While Google’s chairman Eric Schmidt recently told his audience that television is ‘already over’, media industry research shows that record numbers of TV programmes are being watched outside their scheduled broadcast time through on-demand services on a variety of devices.

On-demand viewing is increasing because of its time and physical convenience; laptops are easier to carry than televisions, tablets are easier to carry than laptops, and smartphones more convenient than tablets. This convenience applies to an increasing number of UAE consumers, 73 per cent of whom have Internet-enabled smartphones, and 30 per cent of them say they would rather give up their TV than their smartphone, according to Google’s 2012 Mobile Planet research.

This model has worked for decades when consumers had less choice and allowed what’s known as an interruption model of advertising, i.e., marketers constantly interrupting your viewing pleasure to bring you messages for things you often don’t want.

On-demand viewing is a more ‘consumer-orientated’ approach, which not only allows consumers choice of what they watch, but also when and even where. Within this on-demand, on-line Youtube viewing for example, the advertising is not seen to be as disruptive and can be far more targeted around the content of the video and the type of viewer to reflect their interests based on their search history and information from cookies.

Moreover, consumers have more control over the advertisements and can skip an ad after a couple of seconds if they don’t want to watch it. This degree of control means that consumers become more active and responsible for their own ad watching and if they are in control of the ad, they are more likely to engage with it.

Another big advantage of sites like Youtube is interactivity. In the past, people talked or even shouted at the television, or at least about it.

Now, they can share that with millions of others too by putting those comments in writing while watching on-line. This not only increases consumer involvement, but provides great feedback to TV content producers.

As a result, the migration towards online advertising has been dramatic with viewers often thinking they see fewer advertisements online. However, for every hour watching Youtube, viewers are typically exposed to 7.5 minutes of advertising.

This is similar to the total for television, but because the average Youtube video length is approximately four minutes, the on-line ads are much more spread and you can control them more. As a result, there seems to be less of them.

So is the transfer of control from producer to consumer resulting from media fragmentation and increased online viewing a good or a bad thing for the marketing industry trying to reach consumers? It certainly poses more challenges and adds more complication to the communication process, but if anything, it is a good thing because marketers and companies will need a better understanding of their customers’ preferences and media habits.

Tracking and measurement of consumers’ on-line activities will enable marketers to better answer the questions of where do they consume their media? On what device? At what time of day? Which sites did they visit before watching this video?

Consequently, marketers will be more adept at mapping out their customers’ behaviour leading to more targeted and suitable advertising for consumers which is less wasteful for advertisers.

The writer is a professor of consumer marketing at Cass Business School, London and Cass Dubai Centre.