Feature

Close-up: Live Issue - Is iTV a strong commercial medium?

Can interactive TV ever develop into an effective medium for advertising, Kate Nicholson asks.

Omnicom's decision to invest in interactive TV at a time when the medium's commercial effectiveness is being questioned, has been met with raised eyebrows.

Its £10 million deal to purchase the iTV producer Weapon 7 sits in a radically different media landscape to the one that existed when Sky Digital, the pioneer of interactive advertising, launched JWT's Chicken Tonight execution nearly seven years ago.

At the time, iTV was billed as the answer to marketers' prayers - a new medium that combined viewer brand engagement with directly measurable sales uplift.

Since then, though, the TV audience has become fragmented, and broadcasters have been compelled to slash the rates they charge iTV advertisers. In addition, it's arguable that internet protocol TV is now offering more sophisticated ways of targeting. So how wise was Omnicom's acquisition?

Steven Hess, the managing partner at Weapon 7, argues that iTV as an ad medium has a promising future: "In today's overloaded media environment, consumers who have expressed an interest in a brand and its story can be extremely valuable assets. From research that we've seen, interactive TV adds significant value to a brand. What brand would not like a little one-on-one with its customer?"

Admittedly, interactive advertising has come a long way since UK viewers started pressing their red buttons, and some interactive campaigns have even been rather good: HSBC, Honda, Carlsberg, Coca-Cola and Smirnoff to name five, have dabbled in iTV with measurable success.

There is little doubt that iTV is a great editorial medium - the BBC has scored a number of hits, including Walking with Dinosaurs, The Blue Planet and coverage of Wimbledon. And through paid audience interaction such as voting and competition entry, could be a valuable commercial medium for broadcasters. That said, however, the big question that hasn't been answered in the seven years of red-button television is if it's a good medium for commercials.

Peter Birch, the head of interactive at ITV, explains: "Our revenues from iTV have increased by 80 per cent year on year. I'm also being told by the market that revenues in 2007 are expected to grow by another 35 per cent. Every one of our sponsorship programmes has some kind of interactive element to them. Coronation Street, for example, has three million people pressing the red button every month, who are also spending an average of ten minutes interacting."

But, as Birch says, iTV is not working with the swathe of advertisers that was promised when iTV launched.

For a start, iTV advertising is hugely expensive. Chloe Wilkinson, the head of interactive advertising at Sky, says: "You really need a campaign with a network budget of more than £1 million for iTV advertising to be cost effective."

Second, more often than not, brands just dig out a copy of their traditional ad, cram in a link to more info, bung a bit at the end that asks viewers to "press red for a brochure" and call it job done.

Jeff Dodds, the head of marketing at Honda, says: "iTV is no longer the new kid on the block. The red button has become an omnipresent thing on the screen, but it shouldn't be used as a form of window shopping. You need engaging content if interactive TV is going to work."

CLIENT - JEFF DODDS, HEAD OF MARKETING, HONDA

"It depends on what market you're using interactive advertising for. Advertisers in the financial, motor and travel sectors have embraced the potential of iTV advertising; other brand advertisers have been less enthusiastic.

"iTV can be a chance for us to engage with the audience in an explicit way. We are a content-rich company and it's a great platform to expose people to our brand.

"At Honda, we use iTV as a strategic medium, not as a tactical solution. You can click through and find out about our philosophy, who we are, not about a one-off offer.

"If Sky's recent figures on the success of iTV are to be believed, about a third of viewers have interacted in some way or form."

INTERACTIVE TV PRODUCER - STEVEN HESS, MANAGING PARTNER, WEAPON 7

"Nearly all advertising is going to become interactive. It's wrong to think about iTV as a technology. People should be thinking about it as a form of advertising, a way of stretching TV advertising.

"iTV places a greater responsibility on the advertiser and agency to create work that a viewer will find interesting, relevant and engaging.

"Interactive TV agencies that understand brands and platforms will help advertisers to create new advertising opportunities. These opportunities will be with the viewer's permission, making the opportunity even more valuable."

CREATIVE - NICK BELL, EXECUTIVE CREATIVE DIRECTOR, JWT

"iTV must have a future. The value of consumers interacting with your brand for longer than the average length of a TV ad is huge.

"Smirnoff used iTV to reinforce the 'triple distilled' message in the 'love' commercial.

"Consumers had to distil the ad three times by pressing the red button before they even found out what the brand was.

"The opportunity is the shift from monologue/transmit to dialogue. iTV makes that possible, it allows the viewer to spend more time with the brand."

AFP PRODUCER - MARK BOYD, DIRECTOR OF CONTENT, BARTLE BOGLE HEGARTY

"Yeah, but no. All TV encourages you to interact: to gossip, shout and vote. Since consumers cram the most into each moment, they are demanding more opportunities to be involved.

"However, the red button is constantly disappointing. Ask around and the experience was expensive and incredibly disappointing for advertisers. They went early and have to wait for the broadcasters to invest and educate viewers of the opportunity.

"Red button isn't the answer. But as broadband television becomes commonplace, it will make the current interactivity look as quaint as those big plastic tapes we used to use before DVDs. The future is interactive."