cable

Last week, Wired ran a piece entitled "Netflix Everywhere: Sorry Cable, You're History." It makes a salient point about the contrast between cable's current content-delivery system and the general internet-age trend towards personalization and individualization:

It is odd, in an era when the Internet seems able to worm its way into every part of life, that nearly all of us still watch television the old-fashioned way, piped over cable or beamed in by satellite and available only in bloated packages of channels programmed by network executives.

The point is well-taken. However, I don't buy the underlying premise of the article - that Netflix is in direct competition with cable companies. Netflix is, first and foremost, an internet-based service for renting or watching movies - hence the name Netflix. Yes, Netflix also lets you watch plenty of TV shows, but only after they have been released on DVD. This is fundamentally different from what cable companies offer, which is access to a wide variety of live programming or "new" content.

Rather than framing this as a fight between Netflix and cable, it might be better to think of how cable companies can learn from Netflix's success. And indeed, it seems that they are learning most of the right lessons - several cable companies and Verizon are all launching pilot IPTV programs which will eventually offer much of the same functionality as Netflix, but for new television programming. These services, it seems to me, are likely to peacefully co-exist, and what little overlap there is seems unproblematic.

My hope is that the cable companies really push this effort to its logical conclusion. I recently canceled my cable TV subscription because I found I was wasting too much time watching things I didn't really care about - there were lots of channels, but not much on at any given time that held my interest. However, add a robust recommendation engine and the ability to choose when to watch - an interactive "Dan channel" that would likely consist of the Daily Show, the Colbert Report, the Wire, and sports - and I'd certainly reconsider my decision.

The New York Times reports this week that the cable TV provider Cablevision is introducing a new technology that allows for targeted marketing customized for individual households:

Beginning with 500,000 homes in Brooklyn, the Bronx and some New Jersey areas, Cablevision will use its targeting technology to route ads to specific households based on data about income, ethnicity, gender or whether the homeowner has children or pets.

The technology requires no hardware or installation in a subscriber’s home, so viewers may not realize they are seeing ads different from a neighbor’s. But during the same show, a 50-something male may see an ad for, say, high-end speakers from Best Buy, while his neighbors with children may see one for a Best Buy video game.

While at the moment this only applies for 500,000 Cablevision subscribers in the tri-state area, it seems likely that it will quickly spread. Cablevision intends to expand the service to all of its 3.1 million customers assuming the trial goes well. And initial results suggest that it will:

Cablevision tested the technology by promoting its own services with targeted and untargeted ads. In the eight-month test, the targeted ads brought in new subscriptions at a significantly higher rate than untargeted ads.

Companies, aware that their advertising dollars are threatened by the rise of DVRs, the hyper-saturation of today's media environment, and the drop in impulsive buys due to the recession, are looking for creative and effective ways to market their products more precisely. Those in the political sphere would be wise to take notice as well.

Targeted television marketing is not just limited to cable, either; streaming internet-based TV services, like the upcoming ZillionTV set-top box, allow for similar levels of precision targeting:

The pitch to advertisers is precise targeting: To get high ad prices to pay for all this, ZillionTV will watch your viewing habits, merge them with data about you it buys elsewhere, and use all that information to aim ads at certain groups of viewers. Users will also be asked to select categories of products they would like to see ads about. The ad-supported content will have half the number of commercials as broadcast television, which is still more than online services, like Hulu, have now. And you can’t skip past the commercials.

NDN and the New Politics Institute have long written about the benefits of cable and targeted marketing. Staying on top of television's evolution, as it becomes increasingly personalized and intertwined with Web video, will be critical for any candidate or organization that wants to advertise effectively in a 21st century media environment. 

To learn more about how to target your TV advertising, see our papers "Buy Cable Smart" and "An Introduction to Microtargeting in Politics," and watch this excellent and incredibly enlightening video of Amy Gershkoff of Changing Targets Media from our recent NDN/NPI event, "New Tools for a New Era."

A deeper look at the Democrats' TV ad spending in Pennsylvania yields a significant validation of an argument NDN and the New Politics Institute have long been making.

As Gail Shister wrote for the Philadelphia Inquirer, candidates are beginning to increase their spending on cable advertising.

Sens. Hillary Rodham Clinton and Barack Obama together will spend close to $5 million on TV ads in the closing week before the state's Democratic presidential primary Tuesday.

Philadelphia stations will take in more than $2.5 million of that total, including $445,000 spent on cable - an impressive 17 percent. Cable's average for the five weeks running up to the primary is even more impressive: 22 percent.

Nationally, cable accounts for about 20 percent of political ads this election cycle, experts say, up sharply from the 2004 presidential campaign.

Then, candidates bought cable time "to an embarrassingly low extent," Gallagher says. "They didn't understand we were able to deliver such power for them."

A greater interest in cable isn't suprising given cable's ability to provide much more granular targeting than broadcast. In the same piece, Evan Tracy, a panelist for our upcoming April 24 Reimagine Video event, sums up this point nicely saying, "Cable sells by the pint. Broadcast sells by the gallon."

Turning to the content of the advertising, Hillary's latest ad is very much in keeping with the uniformly strident tone the campaign has been taking in the final days leading up to the Pennsylvania primary. Thematically in harmony with her now notorious 3 A.M. ad, "Kitchen" repackages the readiness question. It begins with the narrator describing being the US president as "the toughest job in the world" while we are shown images of past US crises. Our attention is then brought to the current slew of challenges facing our nation ending with, "If you can't stand the heat, get out of the kitchen. Who do you think has what it takes?" Presumably the implication is that Hillary does have what it takes, turning on its head the demeaning sexist quip that Hillary should be relegated to the kitchen by inferring that yes, she should be in the kitchen, because it is a very hot kitchen and no one else can handle it.

Of course Hillary isn't the only one on the attack. In a break from the generally positive tone of the Obama camp's Pennsylvania ads thus far, "Afford", which began airing on Saturday, goes after Hillary's health care plan. The ad focuses on the same critique we have heard Obama lodge in debates, charging that people who can't afford health care will be penalized. (Another Obama ad, "Reason" also begin airing in Pennsylvania on Saturday.)

Television, the dominant media of politics, is going through historic and profound change. More people watch cable today than broadcast. By the end of the year about a third of all homes will have a DVR, and 60 percent of those with a DVR skip all television commercials. More and more people are watching commercial TV on the web. The big TV networks are moving to a year round schedule. And of course there is much much more....

To discuss all this the New Politics Institute is bringing together leading private sector practitioners to discuss the profound and historic ways the dominant media of politics - television - is changing.

Joining us will be:

Todd Juenger, Vice President & General Manager, Audience Research and Measurement at TiVo, leads TiVo’s Audience Research and Measurement business, which provides advertisers, brand groups, and programmers with detailed insight into how TiVo viewers consume and interact with television programming and advertisements. Todd led the development of Stop||Watch, the only ratings service to provide program and specific commercial ratings, on both a Live and Timeshifted basis. He also oversees TiVo’s internal market research and market testing activities.

Tara Walpert, President of Visible World, Inc., is an acknowledged thought leader in the areas of media, marketing, and client services. She comes to Visible World from McKinsey & Company, where she was an Associate Partner and a leader of the firm's Global Media & Entertainment and Sales & Marketing practices. Over the past decade, Tara has helped a wide range of industry leaders in television, print, direct mail, new media, and retail to develop and implement new approaches to sales, marketing, and CRM based on both traditional capabilities and recent technology-enabled innovations. Tara has an AB in Economics from Harvard University and an MBA from Harvard Business School.

Simon Rosenberg, President and Founder of NDN and the New Politics Institute.

We hope you will join us on Thursday, April 24th at 12pm. The event will take place in the ballroom at the Phoenix Park Hotel, 520 N Capital St. NW, Washington, DC. Click here to RSVP.

If you have questions, please contact Courtney Markey at 202-544-9200 or cmarkey@ndn.org

In the meantime, check out the following suggested readings: NPI New Tools Memo: Buy Cable Smart, NPI New Tools Campaign Checklist, Viral Video in Politics: Case Study in Creating Compelling Video, "The 50-Year Strategy".

This quote comes from yet another Times piece taking a look at the how the important tool of modern advocacy, television, is being reinvented.

In our work at NPI we've written a great deal about how the hegemony of broadcast television is being challenged by the rise of cable and satellite, digitial video recording devices and other new powerful tools like mobile phones, google search ads and youtube. This article takes a look at how the very economic model of what we have known as "TV" is changing.

Learning about how this very important advocacy tool - TV - is changing needs to be high priority for all of us in the progressive movement, for TV has been the primary tool of political advocacy for the last 40 plus years. The big picture here is that video itself is in the process of being liberated from the monopoly distribution of broadcast, and is increasingly being distributed through satellite, cable, mobile phones and the internet, and thus is becoming much more ubiquitous, accessable and commonplace. There is perhaps no more important and more radical change in modern advocacy than what is happening to what we know as "TV" - and there is much more to come.