Friday, May 1, 2009

OnlineSpin: Television Networks Need An Ad Quality Score

Last week Max wrote "Let Beached Whales Die."

Tom O'Brien wrote in response, "Max: Nice article.

How much better off would Detroit be right now if Chrysler had been allowed to die the first time it was rescued?

It would have provided a stark example of what can happen if you don't pay attention (death) and it would have taken lots of excess capacity out of the market.

Both would have been good things for Ford and GM."

Kurt O'Hare wrote, "I agree that sometimes it's the humane choice to put beached whales down -- but don't kill it if you're not prepared to clean it."

Mike Patterson wrote, "Nice! Great metaphor and great commentary.

This insight is piercing, astute and invaluable."

Friday, May 1, 2009
Television Networks Need An Ad Quality Score
By Max Kalehoff

I believe in advertising, but I dislike most television commercials. That's why I bought a TiVo several years ago -- so I could watch exactly the content I wanted, when I wanted, and avoid the rest.

Not surprisingly, with a critical mass of the population using DVRs, TiVo has begun to extract some fascinating insights about network programming and commercial viewing. Todd Juenger,  vice president and general manager, audience research and measurement for TiVo,  recently reported that just like programs, some commercials are more popular than others.  For example, analyzing ad viewership by product category, he determined that in February some categories (motion pictures, foreign cars) were far more popular than others (domestic cars, toilet paper, laxatives).

But here's where his analysis got interesting: "A network that carried a lot of ads for foreign cars would have had higher February ratings than a network that carried lots of domestic car ads. There was a penalty for carrying domestic car ads instead of foreign car ads. Network ratings are being driven not only by the program, but by the advertisements themselves."

According to Juenger, this prompts key questions: "Should networks seek out advertising clients in popular categories, or with popular brand campaigns, and weed out less popular categories? Should networks start programming commercial pods, based on intelligence of which ads will retain most audience, giving privileged positioning to popular product categories? Should networks start charging premium pricing for toilet paper ads (and discounted pricing for theatricals)?"

Foremost, being a viewer who is consistently turned off by most advertising embedded in network programming, I would answer a concrete "YES" to all of Juenger's questions. Each one speaks to the single reason most people get hooked on DVRs in the first place: to watch more content they like, and less that they don't.

But at second glance, Juenger's questions reminded me of Google Adwords' advertising auction system, where Quality Score reigns. According to Google: "The AdWords system calculates a 'Quality Score' for each of your keywords. It looks at a variety of factors to measure how relevant your keyword is to your ad text and to a user's search query. A keyword's Quality Score updates frequently and is closely related to its performance. In general, a high Quality Score means that your keyword will trigger ads in a higher position and at a lower cost-per-click (CPC)."

Why is Quality Score important? According to Google: "Quality Score helps ensure that only the most relevant ads appear to users on Google and the Google Network. The AdWords system works best for everybody - advertisers, users, publishers, and Google too - when the ads we display match our users' needs as closely as possible. Relevant ads tend to earn more clicks, appear in a higher position, and bring you [the advertiser] the most success."

Which brings us back to the fundamental problem with too much advertising: a huge lack of relevance and a big source of irritation. Most agree the television buying and negotiation system is ripe for reinvention. As it evolves to the fast-changing digital video landscape, its architects must remember that we, the viewers, are the primary master. It should be top priority to ensure that the ads displayed match our needs as closely as possible.

Google got somewhere by putting its users first. Networks and emerging video publishers must do the same, unless they want to become less meaningful in our lives. That's why television advertising needs its own version of the Quality Score. For networks, it will be the best defense against viewer dissatisfaction and defection, and the greatest investment to cultivating more loyal and profitable advertiser customers.

Max Kalehoff is vice president of marketing for Clickable, a search-marketing solution for small and mid-size businesses. He also writes

Online Spin for Friday, May 1, 2009:

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