COMMENTARY: Allstate Steps Forward
Issue: Allstate tests dynamic ad serving to television sets with Video-On-Demand
Commentary by: David Vinjamuri
Just a few years ago, the advertising model was simple. Marketers engaged advertising agencies to create 60,30 or 15 second spots for television, print ads and radio spots. We dabbled in small volume projects like outdoor advertising and had special groups to place banner ads on the Internet and explore new media. But we could all be certain that the only way to get on Friends or E.R. was to buy time from the television network.
Suddenly, life is a lot more confusing. Lost, 24, Heroes and the other big cultural series can be found in multiple places. We can watch them live, record them on our DVRs, stream them on the Internet from network websites, purchase individual episodes on iTunes (at least until NBC yanks its shows as it promises to do soon) or watch them on video-on-demand. And increasingly our marketing budget is moving away from the simple :30 second spot that we grew up with.
It’s good news that forward-looking marketers like Allstate are trying to make sense of this mess by exploring new advertising options as they emerge. Brian Steinberg at Advertising Age reports this week that Allstate and its agency Ogilvy have been testing dynamically inserting ads into video on demand shows in the St. Louis market. The agency has chosen to use direct response ads, because they offer the best chance for measurement (because they ask the consumer to take a specific action which can be measured in addition to overall viewership). Not surprisingly, Allstate has found that shorter spots work better, and more entertaining ones are more effective as well.
What’s more important is that marketers like Allstate are actively engaging with new media opportunities and trying to understand how they work. Video on demand is a significant opportunity because it allows the cable provider to dynamically insert ad units which could eventually be targeted to a home based on viewership patterns. Much like the opportunity of digital video recorders, few marketers have really scratched the surface of this technology. It is not surprising, given the rapid development of the media model and the bewildering number of options available to marketers. But this creates opportunity, and daring marketers have a unique chance to create new forms of advertising with modest investments of money and larger investments of time and creativity.
