The UK remains at the forefront of the development of interactive television advertising, a medium that is still in its infancy. Consequently, there is considerable interest in the experience gained to date.

The emerging theme of the London conference on Interactive TV Advertising was measurement and research. There was general agreement that in a medium that should be ultimately measurable, better metrics and analysis were required.

Measured response
Whereas in the past anecdotal research may have been used to justify projects after the fact, there is evidence that solid research is increasingly being used to shape strategic planning.

BSkyB is planning to launch a panel of 20,000 homes which should provide much greater granularity for audience measurement.

Sky recently ran its 500th interactive campaign and over half of last in break spots on Sky channels are now interactive. Without Sky, it is clear that there would be no interactive advertising market in the UK, but Robert Leach of Sky Interactive wishes that were different, welcoming more competition.

“The sooner the cable and terrestrial platforms are able to run quality interactive advertising the better for all of us,” he said. He stressed that interactive advertising is still television advertising, but with potential benefits. He said it represents a change, much like the transition from black and white to colour, but it is still essentially television advertising.

This was a view echoed by Toby Hack of interactive agency OMDtvi. He emphasised that “interactive television is not a brand new medium that demands new techniques – it is a development of existing television. It’s all about making TV better”.

Building brands
Some three hundred of the interactive campaigns run to date have been sold through IDS the sales house representing Flextech and UKTV channels. Mark Connolly, responsible for interactive services at IDS, sees a shift towards using interactive advertising for brand building as opposed to direct response, noting that “people who interact with your brand are more likely to be interested in your product or service”.

Merlin Inkley, head of airtime at Channel 4 confessed that when they started running interactive adverts two years ago they were “petrified of people leaving the broadcast stream,” an attitude that is now changing, although they still do not place interactive ads last in a break.

Representing ITV, Peter Birch argued that “interactivity delivers a deeper brand dialogue to that which can be achieved by a normal spot” and it “makes airtime work harder”.

It was announced at the conference that UK cable operators ntl and Telewest had outsourced the sale and delivery of their interactive advertising inventory to 24/7 Real Media. To date this has been restricted to what are effectively banner adverts on portals, rather than interactive television commercials.

This is also currently the case on the Freeview terrestrial platform. Nigel Walley of Decipher noted that this is a worry for the industry, saying the current “lack of a return path is suicide”.

Increasing competition
The arrival of the Zip Television consortium has undoubtedly stimulated the UK interactive advertising market by providing competition on the satellite platform. As a condition of membership of the Zip consortium every campaign is researched and the whole premise is that the data is shared.

“I was absolutely amazed at how many advertisers had done interactive adverts but hadn’t actually researched what they did,” said Andrew Howells, the managing partner of Zip Television.

The Zip consortium represents a number of leading and competing brands, including both Unilever and Procter & Gamble who can see a long term benefit in sharing their learning at this stage. Howells acknowledges “It’s pretty obvious we’re not in an advanced, developed market when all our clients are sitting in the same room.”

Further competition can also be expected from Access to Audiences, who in conjunction with Press Red, plan to launch a monthly report based on a user panel funded by broadcasters, ultimately marrying response data with the databases of media buyers.

Professor Duane Varan, who has been conducting extensive research in the field, notes that the opportunities of interactive advertising have not captured the imagination of advertisers and brands as much as the threat of digital video recorders, with their potential for ad avoidance. This appears to be a particular problem for some product categories, such as financial services, while others, such as the automobile sector may actually benefit. Another issue is that ‘must see TV,’ the programmes that people most want to watch, appear to be most sensitive to ‘ad-voidance’, ultimately eroding the traditional economy of the industry.

Sky’s Robert Leach agreed that digital recorders are going to have a massive effect on TV advertising. However, he emphasised that what is happening in the US in not necessarily going to be mirrored in the UK. Early research shows that ad avoidance is currently lower with SKY+, although he expected that to change over time. He saw the thirty second spot evolving rather than disappearing and interactive advertising will take and even greater role. He also argued that new technical approaches will be possible with PVRs, such as pausing a live programme while interacting with the commercial.

Whereas a couple of years ago the main players in the world of interactive television advertising could have comfortably fitted around a small table, the turnout for this conference indicated the growing interest in this emerging field, while the case studies illustrated an increasing sophistication in its creative potential.

The Interactive TV Advertising conference was organised by Junction and held at the CBI Conference Centre in London on 28 September 2004.