When it comes to second screen advertising, we are in the experimental stage of what is a nascent opportunity and there is still a lot of debate about just how big the commercial opportunity can be and how much major brands will need the additional interaction that second screen apps provide. These were some of the observations from the Future TV Advertising Forum last week, when it became obvious very quickly that second screen will not be given any kind of easy ride by advertisers just because it is an exciting concept.
Second screen apps will have to earn their place in the media budget by reaching a high number of people on a regular basis and they simply do not deliver the volumes that interest advertisers seriously today. It became obvious that for agencies and buyers, ‘engagement’ is not a measure they value – it is just a means to an end, like if it can lead to higher sales.
This point was made succinctly by Richard Brooke, Senior Communications Buying Manager, Marketing Services at Unilever UK and Ireland. He declared: “You can have elves jumping out of the TV screen and dancing on your carpet and that is fantastic, but it is of no interest if it does not achieve your campaign objectives.”
Like most buyers, Unilever is experimenting in this market and worked with VO5, Shazam and ITV on one advertising project. But Brookes admitted, “We do not know yet where this is going. What second screen means for brands and, more importantly, for consumers, is a massive unknown quantity.” He emphasised that the second screen market is nascent and there are still very low usage figures in relation to total TV viewing hours.
Matthew Kershaw, Content Director & Partners at the creative advertising agency BBH (Bartle Bogle Hegarty), also emphasised the importance of measurement and benchmarking that goes beyond interaction levels. “People need to know that they get X sales from the interaction so they can understand the Return on Investment and we are a million miles away from that,” he said.
Kershaw is doubtful about the prospects for advertising on second screen apps today. “What brands want is media that is effective at changing behaviour and old fashioned TV is still incredibly effective at making people aware of new brands. They will want the same thing from these apps,” he explained to the London audience.
He thinks it is unrealistic to expect consumers to open new apps in order to interact with content and believes that advertisers “will go fishing where the fish are already”. He believes this will lead them to partnerships with Facebook and Twitter. “I would put money on those two companies being happy people when we come out of this. It is not a massive step for them to play in this market.”
Kershaw says there are no barriers when it comes to delivering the creatives for the second screen apps. “What is stopping this today is lack of audience. I do not think second screen is fitting into consumer lives in the way it needs to.”
Kershaw spoke at a pre-conference Breakfast Briefing, where Nigel Walley, MD at the media consultancy Decipher outlined four main types of second screen app. These are: ‘Content Interaction Apps’, provided today by programme makers and broadcasters to accompany shows; ‘Remote Control Apps’ designed to control the TV screen when we are on the sofa; ‘Remote Management Apps’, providing control over TV services when we are away from the TV (e.g. remote PVR management); and ‘Remote Consumption Apps’, which allow us to watch content away from TV, a category that is dominated by broadcaster ‘player’ services.
As you can read elsewhere, Nigel Walley thinks the most promising of these apps for advertising is the ‘Remote Control App’ provided by a platform operator because these will achieve high usage rates. But Kershaw was not convinced that there is any serious commercial opportunity beyond the Remote Consumption Apps, which attract lots of viewers.
He highlighted the way pre-roll ads around player video is already making money and said there are more clever things advertisers could do with these services. Turning back to the other types of second screen app, he argued that there is no point in pursuing them for advertising today. “You are fighting for advertising dollars not just against television but against outdoor and other media, so why should you put money into this?”
Jon Watts, Director and Co-Founder of MTM London, a consulting company that has worked in OTT and advertising among other areas, was also focused on the size of the market. He said advertisers will move money into second screen if it is scalable, robust and proven, but we are a long way from that. He is also doubtful whether we need synchronous (or synchronized) second screen advertising experiences in parallel to the TV content when advertisers can already use their websites to provide a complementary, albeit asynchronous, brand experience to achieve similar goals.
He believes the current asynchronous TV/website approach works very well. “The real question is whether these apps are better because they are synchronous. Or have we just created a more funky way for people to miss the advertisement?”
Watts also emphasised that these are early days in a nascent market. But the problem for anyone looking to monetize second screen apps with advertising is that the advertising industry does not pay for future potential. “We are still waiting for the really big, robust research studies that gauge this market.”
Nigel Walley noted that this market is only just getting started. The ‘Remote Control App’ that his company believes will perform best for advertisers is a very recent arrival. The big opportunity, if second screen apps work for consumers, is to deliver brand advertising on the television and more targeted complementary advertising to the smart device, Walley believes. “If successful, that would bring money in from different budgets like direct marketing. I do not think money would be diverted away from the TV advertising budget.”
He agreed that advertisers are waiting to see how the opportunity develops, though. “If we took a snapshot of the market today then you can see that it is not worth worrying about. There does not seem to be much interest from the big advertising groups other than in experimenting around programme sponsorships. The media industry still needs to deliver some volume and we are maybe three years away from that.”
He thinks the landscape will change during that time, especially as consumers have more smart screens in their home. “You can see that around the control and content interaction apps there will be opportunities for programme sponsors to deepen their engagement with consumers. Whether that generates any additional incremental revenue is hard to determine. You might see broadcasters giving away the second screen inventory just to keep the main programme sponsorship.”
Oliver Newton, Head of Strategic Partnerships at Starcom MediaVest Group, a media agency that is never far from the action where new ad concepts are involved, also said we are in the experimental phase for second screen. But he had a warning for those advertisers who have not yet started experimenting.
“We are at the point where we can afford to get it wrong but this might only last for another year. You have to get involved now and make some bets on this,” he declared.
When it comes to the content interaction category of app, Newton thinks there are only a very small number of programmes that merit their own app, with X Factor being an obvious example of one that does. That means there is room for other more general apps to provide some engagement for smaller shows.
Tom Cape, CEO at Capablue, was also on a panel discussing the market for second screen advertising at Future TV Advertising Forum. Capablue is a software development company focused on Connected TV and second screen that has been working with Channel 4 to create a proof-of-concept for second screen interactive advertising. He noted that advertising is not the only opportunity for broadcasters. It is a chance to extend their engagement with viewers of course, but also to become retailers, encouraging transactions.
Cape is concerned that third-party apps will damage broadcasters – or eat their lunch, as he put it – if they do not deliver apps of their own. “Broadcasters want to own the second screen,” he told the London audience.
Shazam, the content recognition app that makes it easy for viewers to open related ad experiences on smartphones, seems to fit somewhere between these two groups right now. ITV has programme specific apps of its own, like for X Factor, and also works with Shazam, for example. Jon Block, Head of Commercial Innovation at ITV, the man leading the product development for new advertising formats at what is one of Europe’s biggest commercial broadcasters, is not concerned about third-parties trying to piggy-back his content to build their own second screen audiences.
“We have one key advantage: we are the producer and broadcaster and know exactly what is happening in our shows. We have people on screen who can drive the audience to interact with the second screen,” he explained. “I do not think third-party apps will be a threat.”