Let’s face it, no one really likes commercials, but it’s a necessary part of the TV broadcast biz (to offset production costs, etc). Luckily, commercial-skipping technology like DISH’s Autohop (which only works with NBC, ABC, CBS and FOX) and DIRECTV’s 30-sec skip helps avoid ’em if you’re so inclined. The market implication of that kind of technology is lower ad revenue — advertisers usually want engaged folks with at least a partial interest in their product. Enter DISH’s new ad strategy: a bidding system based on customer interest and demographics (all anonymous). Basically, it’s what Google does with their Adwords product, but now for the first time, live on your TV or via DVR. So, is that any better for the average subscriber?
Here’s the way I look at it: I use Google for just about all my searches. I’m well aware most of the search results include a few paid ads at the top of the page. I have a general distaste for all kinds of ads, but Google probably has the most advanced type of ad-to-consumer ecosystem on the internet. Any mom ‘n pop can spend as little as $10 to find the EXACT type of person they cater to; eg, Dee’s cookies in Dallas advertises to folks JUST in the Dallas area searching for any combination of “cookie”-related terms. David does just that on his smartphone, discovers Dee’s cookies and 10 min later, is chompin’ on a pound of peanut brittle. A win-win for both.
Back to DISH, they’re looking to launch something similar, albeit a bit less targeted. Their advertising partner is Hadoop, a highly-advanced ad platform that helps match consumers with the most relevant ad available. With Google, folks type a search term (that’s the KEY target item), so how will it work with live TV? My guess is Hadoop will use your basic demographic information for targeting: age, gender, city, state, etc. (your name will almost definitely be anonymous). With that set of info, an Atlanta, GA car dealer could target 30-40 year-old men in their city. Now, they really won’t know if he’s looking to buy a car (eg, there was never a search for “buy a honda” as with Google), but that’s a heckuva lot better than zero targeting, which is the current situation. If another dealership in the area jumps into the system that’ll likely raise the bid on the ad until competition wins out.
Bottom line, subscribers watching TV will get more meaningful ads and advertisers might be willing to support DISH more than they have in the past. Will it be enough to avoid the forward or commercial skip? Probably not for most, but when we you DO catch ’em, you’ll probably be pleasantly surprised at how potentially relevant and/or useful they’ve become.
So, when can you expect to see these new ads? They’re still in testing phase but my guess is by the first half of 2016. If a trial run proves successful, they’ll probably roll it out nationwide. Just as with all new ad platforms that involve customer data, I hope DISH is up-front and fully transparent with its customers before they go live and give them an option to opt-out of sharing certain personal information if they so desire. When customers feel informed and also see a potential benefit, both sides are more likely to find a permanent match…vis-a-vis smart ads or business in general.
