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Straight Talk Media & Entertainment

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Instagram’s recent decision to sell 60-second video spots looks like yet another attempt by a digital platform to eat into traditional TV advertising budgets. But pushing in the opposite direction – towards ads even as short as 3-5 seconds – represents another future that could make both TV and digital advertising a better deal for advertisers, platforms, and consumers.

To understand why, it’s first worth questioning why some in the industry assume today’s TV ads offer more value than other options. I still hear, for example, some traditional TV executives deride emerging digital formats as too short, commanding little attention, and generally not much more than a con trick from their wily Silicon Valley-based creators.

But why are TV ads as long as they are?

I’m no media historian, but my understanding is that TV ads started out longer and got shorter as broadcasters sought to maximize value for advertisers and minimize disruption for viewers. Today’s spots tend to be 30 or 60 seconds long, with 10-second spots occasionally employed.

But it’s hard not to conclude that broadcasters have been less interested in finding the right balance than working out what they can get away with in order to sell more air time. Why else would the number of minutes of advertising for every hour of programming be regulated in the vast majority of countries?

Only recently have broadcasters begun to think about the consumer. Turner plans to reduce the number of ads per hour, known as “ad loads,” for its TNT and TruTV channels by as much as 50%. Viceland, the channel to be launched by digital upstart Vice Media this month, will similarly allow just eight minutes of ads per hour, according to media reports.

Bear in mind that we’re talking about the US here. If you’re from Europe, the amount of ads on US TV can feel bewildering and depressing, with nearly 20 minutes per hour. The moves by Turner and Vice will only bring their ad loads broadly in line with those of most channels in Europe.

In any case, the industry’s track record gives me little confidence that these levels are anywhere close to an optimum balance for the modern consumer.

Vice’s approach, at least, is refreshingly honest. The company doesn't believe traditional TV is a superior medium, but is investing because it’s where “75% of the world’s advertising budgets” are still being spent, CEO Shane Smith told The Hollywood Reporter trade journal.

In other words, while there’s still a party, why not enjoy the wine? The advantage Vice has is that it can continue the party with its thriving digital business, while rivals that have over-indulged on the excesses of traditional TV advertising will be struggling with their hangovers.

From the promise of digital…

Online video offers advertisers the opportunity to break free from traditional media’s constraints to experiment to provide more consumer-friendly experiences.

Many digital-first platforms – at least initially – limited ads to 30 seconds or less. Conversely, YouTube and Hulu have also allowed advertisers to offer ads several minutes long, as long as viewers can opt to skip the ad after 10 or so seconds.

Both approaches promise a better deal for the consumer. With ads of 30 second or less, someone watching, say, a three-minute short-form video is not forced to watch nearly as many minutes of ads. Skippable ads enable viewers to watch only the ads they choose to.

…to the problems of digital

Unfortunately, these supposedly consumer-friendly formats have had the unintended consequence of highlighting just how unpopular advertising is with many viewers.

Various reports over the years have suggested that viewers skip between 70–85% of skippable ads. People are also bypassing those relatively non-intrusive non-skippable 30 second ads, with YouTube star PewDiePie stating that about 40% of his viewers use technology to block ads from appearing.

Clearly, this is not what advertisers and platforms want. But, while some are looking to innovate, many are reverting to the ways of the past. Many broadcasters now offer video-on-demand services that feature several minutes of non-skippable ads in each pre- and mid-roll segment, just like good old TV.

The industry is also pouring a lot of energy into preventing ad avoidance, such as technologies that coerce viewers into switching off ad-blockers or trick the software by “seamlessly stitching” ad content with the main programming.

Ultra-short ads are a better deal for consumers

An alternative approach – and dare I say, a better use of energy – would be to focus on creating advertising that people are more willing to tolerate.

There are numerous ideas about how to make advertising more consumer-friendly, but many will be technically or commercially challenging to pull off, such as more accurate targeting or producing branded content at scale.

One simple way to would be to make ads shorter. It’s easy to see why this would be good news for consumers. They get to watch the videos of their choice with less interruption, while helping to generate ad revenue so that content owners can invest in more content.

The virtuous circle of eyeballs, algorithms, and ad loads

Here’s why ultra-short ads make sense for media businesses.

Many digital platforms ration the number of ads that appear around videos in order to – you guessed it – make them less intrusive and annoying. They also use algorithms to place more ads around “good content.” The thinking is that people will be more willing to sit through an ad if there is a compelling video to watch after it finishes.

What counts as good content? For all Silicon Valley’s talk of artificial intelligence and neural networks, my understanding is that it’s largely videos that attract lots of views and most people watch more or less to the end.

How do you get more viewership for your videos? Reduce the risk of people clicking or swiping away, by making ads shorter and less intrusive. And if more people watch your videos, then the algorithm will serve more ads around them and you can generate more ad revenue to reinvest in great content.

All in all, ultra-short ads promise a virtuous circle for content owners, advertisers, and platform owners. More videos watched, more ads served, and more revenues generated.

Ultra-short ads are already with us – in spirit

The 30-second spot is proving stubbornly popular with buyers of both traditional and digital advertising. A series of sub-10 second ads for Adidas and Harbin Beer shown around the 2014 World Cup soccer tournament are among the few mainstream examples of ultra-short ads.

Advertisers are starting to experiment with Twitter, Facebook, and other digital platforms to go as long and short as they want as well as exploiting time-limited formats, such as Vessel’s 3–5 second spots, Vine’s 6-second loops, and Instagram’s 1-second boomerangs.

Even buyers of “longer” 30-second digital spots are embracing the ultra-short ethos. Given that many emerging platforms enable consumers to swipe away or quickly scroll past, creatives are loading their clients’ messages towards the beginning of their video ads.

Facebook is encouraging its advertising customers to “make the first few seconds count” and “focus on storytelling, not length.” It touts a study commissioned from media measurement firm Nielsen that shows that two-thirds to three-quarters of an ad’s impact on recall, brand awareness, and purchase intent happens in the first 10 seconds.

Resisting the romance of the traditional TV spot

The ultra-short ad concept will only succeed if brands buy into it, regardless of how well it sits with consumers. After all, it is the brands that are the customers of advertising; the audience is merely the product the platforms are selling. And history has shown that platforms are more inclined to side with their paymasters.

As well as proving ultra-short ads work – by say, driving awareness or increasing sales – platforms will have to counter the emotional investment the advertising business has with the traditional TV spot. The industry has a reputation for glamour and many executives would no doubt like to be making or funding classic creative like Ridley Scott’s “1984” ad for Apple or Jonathan Glazer’s “Surfer” ad for Guinness.

Such ads will continue to exist, as shown by the continued success of the Christmas ads from UK retailer John Lewis. We will also see longer ads of several minutes provided they promote products worthy of such attention and are presented in ways that engage rather than annoy viewers (though the lines between these ads and branded content will blur).

But I can’t help but think that the vast majority of products and brands don’t deserve even 30 seconds of airtime. Perennially high levels of ad-skipping, growing use of ad-blockers, and the phenomenal popularity of ad-free services such as Netflix suggest many consumers agree. Less intrusive ultra-short ads are an option the industry can’t afford to ignore.

Straight Talk is a weekly briefing from the desk of the Chief Research Officer. To receive this newsletter by email, please contact us.

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