The Internet has rocked the marketing world. But just as marketers are getting a handle on the concept, it is likely to end up passe - at least as far as automotive advertising is concerned.
Automotive companies will continue to use Web sites to provide information to consumers, but the tool that will gobble up most automotive marketing cash will be interactive TV - technology enabling viewers to use a remote to interact with virtually anything shown on a TV screen.
Robert Mancini, executive director of Ford Motor Media, told me two years ago that TV would continue to dominate automotive advertising, but that TV advertising would be far different than we know it today. He said marketers were eager for new technology that would allow them to talk with consumers via TV, and he predicted that would happen early in the 21st century. I didn't understand at the time, but it is coming to light, and it is a concept that more people will learn about over the next two to three years.
According to a report by Forrester Research of Cambridge, Mass., 4.9 million households currently interact with broadcasts using boxes such as WebTV or cable and satellite services such as Wink. The response rates are encouraging. More than half of WebTV Plus users have registered to play along with 'Jeopardy' or 'Wheel of Fortune,' and 46 percent of WebTV users watching a Melissa Etheridge concert clicked through to find out about discounts at a CD store.
Names and addresses
That's the kind of feedback automakers want from their TV dollars. They want names and addresses, and they want immediate response. Interactive TV is a step in that direction.
Forrester analyst Josh Bernoff projects that the technology is likely to be in more than half of U.S. households in five years, and cable and satellite systems will account for the lion's share of interactive TV viewers. That's because satellite and cable companies are able to install set-top boxes that deliver digital video.
'Interactive TV will redirect marketing revenue streams,' Bernoff writes in his report. 'It will once again turn the media business inside out. The deluge will sweep dollars out of network advertising and direct marketing budgets, redirecting them to cable and satellite operators.
'Advertising and television executives, weary from mastering the Internet, will be caught up in the whirlpool as this new medium sucks up $20 billion from existing media.'
Initially the dollars will be redirected in three ways, according to the Forrester report:
1. Electronic program guides: The scrolling guides that detail program offerings on cable and satellite systems will reach 55 million households, generating $4.3 billion in ad revenue over the next five years. Today, all satellite and most cable guides are advertising free. But Bernoff believes that ads will appear in 60 percent of all guides within five years, and that within that time, cable operators will perfect technology that will allow viewers to interact with ads on those guides. Bernoff thinks automakers will flock to the guides because they have both a nationwide and local reach, and prospects can be passed on to dealers. 'Program guides will touch more Americans than any media property,' Bernoff writes.
2. Enhanced broadcasts: This technology allows viewers to respond to broadcasts and/or commercials as they do with the earlier mentioned 'Jeopardy' show. Some brands, such as Ford Division, already are inserting links into their commercials that let viewers go back into the Ford Web site or give Ford information, but the concept still is at the embryonic stage. The idea is to give advertisers names and addresses. Bernoff projects this technology will be visible to 24 million households, generating $10 billion in TV revenues over the next five years, and that 75 percent of commercials will go interactive. This type of advertising will cut into traditional TV and direct marketing budgets.
3. Web browsing on TV screens will reach 13 million households, delivering $5.3 billion in TV fees, including subscriptions, advertising and commerce. Bernoff says Internet access providers will lose out to cheaper, cable-based access.
Test ads, try again
But getting leads isn't the only selling point for interactive TV. Advertisers can test interactive ads overnight, examine the results, re-edit and try again. And there's the potential to e-mail commercials to friends or family members, making word-of-mouth a measurable metric for TV spots.
The Forrester report predicts that cable and satellite will account for 81 percent of the electronic program guides, 71 percent of enhanced broadcast leads, and 26 percent of TV browsing, leaving broadcast and the Internet to scramble for the scraps.
'The Internet will be relegated to airline reservations and businesses selling truckloads of steel,' Bernoff writes. 'The Internet will be hardworking and practical, but not very sexy.'
You can contact Kathy Jackson by e-mail at [email protected]