Consumer Interest ‘Impressive’ in Ads for Sony, Samsung Connected TVs, Rovi Says
One out of every two consumers who buy a Samsung connected TV is creating an account at Samsung.com to have access to apps via Samsung’s Smart Hub TV, said Jeff Siegel, senior vice president of global media sales at Rovi, speaking on a panel in Manhattan Wednesday on the future of TV and advertising. Rovi is a provider of a program guide for connected TVs and developer of an advertising platform it’s testing on Samsung and Sony connected TVs. Siegel told us click-through rates for consumers’ interaction with ads from Carnival and Hellmanns’s in the test have been “impressive.” He wouldn’t provide details, saying the company plans a detailed review of results at the end of the summer.
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Rovi launched Internet-connected TV field trials for the ad platform in April (CED April 6 p3) with Samsung LCD sets. The company also began testing its advertising platform on all connected Sony Bravia TVs May 9, Siegel told us. Older model Sony connected TVs will be upgradeable to the Rovi ad platform in the future, he said, but no date for an update has been announced. Samsung TVs with Smart Hub are compatible with the ad platform but not early Samsung connected TVs, he said. Rovi plans to expand across multiple CE brands, Siegel said. The test, which will include Nielsen consumer research, runs through late August and is expected to yield information on viewing habits, click-through rates and preferences for fonts, text size, colors and other data, Siegel said.
There’s 20-25 percent monthly growth in the number of users connecting to Internet services via TV, driven by the amount of available content and services like Smart Hub that aggregate consumer information “so they don’t need seven user names” for apps and services they want to access, Siegel said: “We're going to look back on 2010 as the tipping point for connected TV devices.”
Citing CEA research, Siegel said 20 million connected devices are in the market, and the number is expected to jump to 100 million in 2014. Rovi’s own surveys show 17 percent of broadband consumers connect their computers to their TVs at least once a week. Based on that, Siegel said, there easily could be 300 million connected TV devices -- including PCs, tablets, Blu-ray players and game consoles -- in coming years. Questions for advertisers remain, “how many are going to connect them, what are they going to do, what will they be able to do with the content on those devices and what’s going to happen with advertising?"
Connected TV is changing how teams are being structured on the agency side, said Lori Schwartz, chief technology catalyst for McCann Worldgroup. “You're going to see at a creative agency developers and creative technologists that use software,” Schwartz said. Projects once exported to companies that specialized in interactive content will be brought in-house as part of mainstream agencies, she said. “Our clients are experiencing technology, buying iPads and seeing a sea change in their own daily lives,” she said. Interactivity is not this outside cool thing anymore. Now it’s part of business,” she said.
Advertisers are asking why they should be in the interactive TV space, said Siegel. “The answer is we now have IP addresses for each one of these connected televisions and you can layer on top of that psychographic information.” Targeting opportunities include demographics, and purchase intent, with the latter coming from consumers who have opted in to targeted advertising. “GM is very interested and wants to be able to target people intending to buy cars,” he said. “They'll pay a premium for that.”
Technology has made more viewer data possible than at any time before, “but what do you do with all the buckets of data?” Siegel said. “Who has time to read all that?” In its research with Nielsen, Rovi will spend “a lot of time figuring out how people interact with the ads within the guide and in the smart TV space,” and how they are using interactive platforms in general. Rovi plans to learn “how people are using smart TVs,” including what colors they like, how often the ads should change, and whether they should use video in ads. Results will be released in the fall. Since the Sony and Samsung TVs have been in the market, Rovi has started to see click-through rates, time spent on ads and overall engagement levels on par with “the early days of the Internet,” Siegel said. “We're seeing people want to play around with content,” he said. He wouldn’t disclose the click-through rate at this time.