How can you innovate to prevent technology from disrupting your business?
In the advertising world, Google AdWords and other forms of "contextual" placement of ads have been disruptive to mass media. Turner Broadcasting wondered whether it could prevent disruption by somehow applying this idea to cable television. We ran tests in the marketplace to learn the best way to implement it.
The television ad model is being challenged on multiple fronts. The Internet has drawn billions of dollars of ad spending away from mass campaigns to much more targeted messaging. At the same time, with DVRs, viewers are fast-forwarding through TV commercials. These trends are eroding the network TV business.
With its cable networks that reach hundreds of millions of households worldwide, Turner Broadcasting needed a way to make ads so relevant that viewers would actually want to watch them. This would give marketers a new reason to buy spots. "We know how challenged advertisers' budgets are," said Linda Yaccarino, chief operating officer for entertainment sales, marketing and acquisitions at Turner Entertainment Networks. "We want to challenge all the traditions of how we format our networks."
CHALLENGE: Google AdWords and other "contextual" advertising have been disruptive to mass media. With DVRs, viewers are bypassing commercials. Turner Broadcasting wanted a way to get viewers to stop and watch the ads.
INSIGHT: What if the network could tag moments where an ad could blend in? The proposed idea: "TV in Context." If Matt Damon's car in 'The Bourne Supremacy' crashes, follow with a spot for GM's OnStar emergency service.
BARRIERS: Would the idea work in practice? There were many technology, cost, and viewer psychology issues. Innosight helped refine the innovation, experimenting with syndicated shows such as Law and Order and Seinfeld.
STRATEGY: Using our "emergent strategy" approach, Innosight designed low-cost tests. We tagged moments in TV shows and movies. A cognitive scientist ran studies on consumer recall. Advertisers critiqued mockups.
IMPACT: Viewers were 18% more likely to recall the ad and were twice as likely to buy the contextually advertised product. After a year of piloting, TBS and TNT expanded "In Context" to more than 100 shows and movies.
Marrying contextual ads with television
What if the network could tag moments in TV shows where an ad could blend in seamlessly? Turner executives proposed an idea: If a scene of The Office takes place in a Chili's, follow that with a spot for Chili's. If a car in a movie crashes, follow with a spot for GM's OnStar.
They called the idea "TV in Context."
But Turner's executives weren't sure whether the idea would work in practice. There were too many technology issues, cost issues, and viewer psychology issues. The company turned to Innosight for help.
We supported a new cross-functional corporate team to figure out the best way to implement this innovation. Using our "emergent strategy" approach—learning fast from failure points and adjusting—Innosight designed a series of low-risk tests. Team members worked to tag moments in existing shows. A cognitive scientist performed studies on consumer memory and recall.
Initial research indicated that viewers were less likely to skip a contextual ad. Viewers were also more likely to recall it and to buy the contextually advertised product. Since these early results looked promising, Turner expanded the test.
We further refined the offering and pitch materials that went out to potential advertisers. According to Turner, our work accelerated progress with the innovation by as much as two years.
Generating early buzz
When Turner introduced TV in Context at the 2008 "up fronts" meeting, it created substantial buzz and traction.
What if you "saw the scene from 'The Godfather' when Vito Corleone leaves his office at the Genco olive oil factory and a commercial comes on for Bertolli olive oil?" wrote The New York Times. "Turner Entertainment Networks wants to turn those coincidences into sales opportunities."
The idea caught on. Advertiser sign ups included Applebee's, Best Buy, Chili's, DirecTV, Hallmark, Kellogg and General Motors.
Making an impact
Contextual ads proved to boost attributes like engagement, recall and purchase intent. Results included an 18% increase in ad recall, according to Nielsen. Consumers are twice as likely to buy the featured product, according to OTX Research.
After a year of piloting with real advertisers, Turner's TBS and TNT networks expanded "TV in Context" to 100 shows and movies. The service is now part of Turner's standard offering to advertisers.
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