Tim Hanlon Interview

In late 2007, SpotXchange CEO Mike Shehan sat down with Denuo Group, Publicis’ Senior Vice President Tim Hanlon to discuss the future of online video advertising. The conversation was inked and published as a two part series in MediaPosts’ VideoInsider Newsletter. But, the articles didn’t cover the entire conversation. The rest of the interview is included in this month’s edition of SpotXchange Insight.Read article one and article two for a look at their in-depth conversation on online video advertising.

Mike Shehan (MS): How do you think the agencies and media buyers are grasping the video sponsorship intermingling of online and television?

Tim Hanlon (TH): It’s classic agency iteration. They wait for things like scale and volume to occur. I think 2007 showed this type of behavior, i.e. non-linear viewing inclusive of broadband video became a sizeable activity-so sizeable that it is impossible to ignore. That said, what you have is a turf battle by television buyers who originally bought network programming in a linear fashion and interactive media buyers who have been experts to all things online. When you toss the ball that is broadband or online video up in the air it is literally a jump ball between those two differing perspectives. The idea is the clear harmonizing of both.

Television buyers should be comfortable with the notion that their video ad can and will run against the same programming and be measured in a more granular fashion. The digital buyer needs to be aware of some of the more historical truths of television, e.g. mass audiences, CPMs etc. But, both need to work in unison for the advertiser. Unfortunately agency structure gets in the way of that behavior.

You see either one or the other dominating the buying process-for some it’s a digital agency, for others it’s a TV agency. It encompasses both television and online dynamics. How marketers choose to have online video analyzed and bought is up to the marketer. I argue that they should harmonize as quickly as possible because they are one in the same. It goes back to my broader thinking that it’s not new media anymore, it’s simply media.

MS: As an insider do you see those silos breaking down or are the walls getting thicker?

TH: Money dictates structure, behavior, agreement, etc. We’re still in a place where we objectively see data pointing to a more holistic viewing pattern across multiple touch points.

The reality is that the budgets are still stuck about a year or two behind and they are disproportionately biased toward linear television distribution. Two things can happen: one, the traditional purveyors of linear television, broadcast networks, cable networks, stations, etc. broaden their opportunity to be not just linear television, but to be on-demand, online video, mobile, etc. The television buyers adjust their budgets accordingly, the networks now get multi-touch point buys and not just television buys. The other thing that can happen simultaneously or instead is a general shifting of budgets based on overall viewing behavior regardless of where it’s coming from.

The challenge is that not every broadband or online video environment is from a trusted television brand. You’ve got the blip.tv’s of the world that are offering worthy original content. You’ve got companies like nextnewnetworks and other digital studios creating new content that have advertising opportunities. If I’m a television buyer I can’t sit back and wait for my traditional TV sellers to do the adjustment for me and then bring me along for the ride because that’s only half the battle. The other half is this explosion of ‘other video’. Some is quality, smaller audience, which in aggregate is notable. Ironically, those long tail programs can actually start scaling up with more audiences and can maybe make the jump to these hallowed networks some day.

It’s a cycle of existence where the traditional big broadcast television programs are now available in lots of different digital touch points and lots of original stuff from the ground level. Creative individuals can actually start aggregating little audiences by themselves and can get the attention of big distribution channels. If I am considering video for my client’s advertising, I need to be fully cognizant of all of that behavior and evolution.

MS: In today’s world we find ourselves fighting agencies to get the video creative that was used just for the TV buy.

TH: That money is still going to come from television budget spillage which brings creative advertising spillage, producing the 15s and the 30s originally created for television. I think we’re nearing the end of that first generation and we’re starting to really get people to create with multiple video touch points in mind. The reality is that this is going to happen incrementally. Year over year we will be in a more sophisticated place. I am not saying that mass TV centric buys, like American Idol and the Super Bowl, will go away. But the disproportionately larger amount of video buying-not TV buying, but video buying-across lots of touch points including broadband video will be a more sophisticated exercise in the next year or two.

MS: Marketers tell us different things are important to them: CTRs, conversions, percentage of the video ad viewed, etc. Do you think there is any right or wrong measurements in an online video ad buy?

TH: Increasingly marketers and their agencies are going to have different variables for how success is judged. These early days are influenced by TV. But online video is more than that when you get in to dimensionalization, direct response or the ability to go further with an ad message and/or the granular targeting. With all media, you are going to see an increase in the desired metrics by advertiser, and they are not going to be as uniform as they were historically. Most marketers and their agencies are going to be interested in having as many granular demarcations as possible. Individuals are going to aggregate the way they choose. I like to use the example of when Bank of America bought the MBNA America credit card. They pioneered “infinity marketing”. The approach was not to market a VISA or a MasterCard but a Georgetown University alumni association VISA, an American Dental Association MasterCard or the New Jersey Devils VISA card to 10, 20, 30 thousand people at a time, in their own way and environment. It’s up to MBNA to aggregate those audiences, thousands of different groups to whatever scale they need to be a viable business. They effectively became the second or third largest credit card issuer in the country. That is what marketers are moving towards.

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