November 29, 2005

According to news reports, TiVo is partnering with some large advertising companies to let its users search for ads centered around certain keywords.

Expected to launch next spring, the feature comes as Madison Avenue is contemplating a number of ways to reach consumers who use technology to avoid traditional advertising.

TiVo is working to develop the product with three media-buying operations -- Interpublic Group of Cos.' Interpublic Media, Omnicom Group Inc.'s OMD and Publicis Groupe SA's Starcom MediaVest Group -- along with independent Dallas ad agency Richards Group and Comcast Corp.'s Comcast Spotlight ad-sales division.

People who watch traditional television are forced to view commercials in random fashion, regardless of what they may be interested in buying, says Tom Rogers, TiVo's president and chief executive.

"We're flipping the dynamic," he says, allowing TiVo subscribers to search for ads that match their interests.

"If you are in the market for a product, and you have no idea when commercials related to that kind of product are going to appear, it doesn't help you very much," he adds.

TiVo users will be able to set up a profile of products on their television screens by clicking on categories such as automotive or travel or typing in keywords such as "BMW" or "cruises."

On a regular basis, TiVo will then download relevant commercials to TiVo recorders over the Internet or, for those users who don't have broadband, send the video via traditional broadcast signals. The commercials will appear on-screen in a folder next to the list of television shows TiVo users record.

Advertisers, in turn, will be able to select the keywords and categories with which they wish to be associated for their ads.

TiVo is in discussions with advertising agencies about the best way to price such advertising, but one option is to let advertisers bid on keywords as they do when buying ads on Internet search engines.

"The Google model is something we're reviewing," says Davina Kent, TiVo's vice president for national advertising sales.

TiVo's pioneering digital video recorder, or DVR, is much beloved by consumers for its ability to easily record and pause live television shows.

But it has sent Madison Avenue and broadcasters into a tizzy by allowing viewers to skip traditional commercials.

Recently, TiVo, of Alviso, Calif., has come up with a pitch for advertisers: Use the TiVo DVR itself to send new forms of interactive advertisements.

Yet a big question remains: If viewers use DVRs in part to avoid advertising, will they use the devices to watch more of it?

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With DVR penetration expected to rise and consumers increasingly able to watch TV programs when they choose, this conundrum is one Madison Avenue has been trying to solve.

As consumers watch video through Internet-based broadband, via video-on-demand on cable and on Apple Computer Inc.'s video iPod, storing programming or advertising and searching for it could become more of a habit.

While this sort of searching is in its infancy, eventually, "your ability to search video content will equal your ability to search Web content," says Marc Landsberg, president of Arc Worldwide, a Publicis marketing-services firm.

Indeed, ad executives suggest advertisements will have to evolve in two ways.

They will either need to generate enough buzz so that consumers are eager to find out more about them.

Or they will need to become less filled with hype and offer more bare-bones information, much like Internet paid-search ads.

Source: WSJ

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