A fair swap mate….
Would you swap your personal viewing activity in exchange for better targeted advertising? This ‘value given for value received’ equation is critical if the industry is going to succeed in migrating from mass to me. Now if you are reading this, then the smart money says that you are in the industry and get the trade off. But what about Ma and Pa living in Middle America? This has to be a really difficult concept to grasp.
An indication of the size of the challenge is given by the furore around Phorm (www.phorm.com). This is a technology which sits in your ISP, tracks all of your surfing activity, crunches that data in a big database and spits out targeted ads especially for you. A great idea but one that have given the internet purists a coronary and the regulators a job for life. Tested unwisely without user consent a number of months ago, BT are now asking for consent and claim that their customers understand and value the trade-off. I hope this is the case but I suspect that either they don’t truly understand the deal or the trial group are sophisticated users.
Imagine the conversation:
Provider: ‘if you let me track everything you do then I’ll send you ads that you will really want to see’
Customer: ‘I don’t like ads’
Provider: ‘But you don’t understand, you don’t like ads because they are not targeted. Now you will love them’
Customer: ‘so you guarantee me that I will love every ad?’
Provider: ‘well not exactly. The special algorithm which we have developed should do the job quite well after a while and once we have tuned it’
Customer: ‘doesn’t sound convincing. What if I look at adult content, will you send me loads of escort agency advertising?’
Provider: ‘Oh! At the moment it is probably our intention to potentially discard this information sometime in the future.’
You get my gist. A tricky conversation at the best of times.
However, there are easier deals to sell. How about exchanging consumption data for loyalty points on your club card? For a free movie once a month? For an iTunes download? For free samples? For reduced subscription rates? For cheaper petrol? These are easier to understand and could help the migration from trepidation to acceptance.
Let me be clear, I’m a real fan of the swap. However, companies offering the deal need to be trusted, open, transparent, consistent, honest and fair. How about the following message:
Provider: ‘Dear consumer, we want to deliver the most compelling entertainment experience to you that we can. Amongst other things, this also involves attempting to refine and target the ads messages that are essential to our revenue model. We would like to use your viewing habits to learn more about you and then, over time, do our best to deliver more valuable advertising. We absolutely guarantee only to use this data for this purpose, to use it anonymously so no advertiser sees your details, to offer you the ability to opt in or out at any time in the future, to poll you regularly to see if our solution is working and continually refine this solution over time so it really works for you. We have published a full Privacy Policy which lays out, in plain words, this commitment to you.’
If companies really start to get this right then the most effective marketing of all – advocacy – kicks in and your family and friends start to tell you how good the solution is and how they trust the provider.
So the industry has a strong marketing challenge making personalisation work but one which must be faced and won. I suspect that the trusted brands (are there any left??) will find it easier to achieve and that less well known companies will need to partner and proxy this trust.
So what‘s your view? Is it a fair swap? All comments welcome.
The swap is not fair, as customers are not interested in better ads – they suffer them in exchange for watching content or using services (in fact many now just skip them). They have already done a deal for getting content for nothing or low cost and would be wondering about what they get about an extended deal like this.
What they may swap their personal data for is LESS Ads, filtering out all the ads they are not interested in, however advertising agencies would see that only as a way of pushing more assets and annoying the customer more by filling up the same ad breaks with more of the same. I for one, do not look forward to four 3 minute breaks an hour of ads about gadgets and sci-fi books,
Great point Ian. I suspect that most consumers will want this option but then most content will have to be direct sale or subscription as there will be no ad revenues to deliver it ‘free’ anymore. There lies the crunch – pay for it, watch untargeted ads or lend your consumption data to receive more targeted messages? With the high amounts of media fragmentation then finding you long enough to give you the choice is also a challenge.
Suspect this debate may be more generational that we give it credit. People under 30 who have grown up with the internet, and cookies, have an understanding of trading their behavioural data for free mobile calls for instance (witness the take up of Blik). However for me the sadness is the policy makers and discussion groups (in the press) are often filled by the over 40s who are much much more sensitive to personal data.
Perhaps the younger generation need to have their values heard – what will they exchange for what etc?
=37 so probably too old……
Hi Andrew,
I was at a VOD event in London organized by First Tuesday a month ago. I asked some of the experts there if they thought Advertiser Funded Programming would be important in a VOD context.
What really surprised me was is that several people there involved with running VOD services thought it wouldn’t be important. Some said targeted advertising has been tried in the Music Business and was proven not to be a success. I disagree.
In short, I reckon that it’s probably got to do with incorporating Advertising in a VOD business model is something which will only yield long term results, and last month’s buy rate is still one of the most important benchmarks for these folks. Hence they are reluctant to risk themselves on implementing something that will only yield longer term benefits when customers and technology around this matures.
One of these days I’m planning to elaborate a bit more on this on our company blog: http://bebanjo.wordpress.com/
Bastian