Why TV Advertising Is About to Change Forever

This piece was first published to Ad Week - click here to read it there,

With the launch of DirectTV now earlier this month, cord cutting at scale is likely about to get very real. But will we unleash the real potential of it or make the same mistakes of the past?

People in an industry tend to see things rather differently from people outside of it and have their own special flavors of irrelevant distractions, such as streaming vs broadcast and the nonsense fight between TV and video. Even in my role as tech support to my agency and head of innovation I've no idea when I'm watching streamed or broadcast TV, I never know if it's locally stored or on demand. Yet our industry thrives on terms like VOD, Linear TV, Traditional TV, SVOD, AVOD, terms that have fixed definitions but no meaning.

We're watching less TV than ever, but more video. But what does that even mean? When does Video become TV? If TV was once a device we watched it on, what is the defining characteristic in today's world of devices? Is it about length: are Daily Show highlights on YouTube played on my TV too short to be "TV" at 7 minutes long? Is it about the device I use: is the NFL on my phone via Twitter not TV? Is it about production quality: is Jimmy Fallon on SnapChat considered "TV" because it's well made? Maybe it's the pipeline. Maybe for it to be "TV" it has to come via radio waves, but what of Netflix or Hulu?

This can all fold under the biggest problem with technology—we tend to use it to embellish what we have, not empower new possibilities. We place it around the edges of what we've known. We use it incrementally not transformationally. Yet, interestingly, I think the future of TV advertising is fantastic in that so many of the things we assume to be threats are opportunities.

TV and the advertising it carries will, over the next 5 years, be completely digital. Our entire industry's odd complex about digital and our strange organization and separation around it will be blown up because virtually all media will be digital. The gap between video and TV will be entirely destroyed as we realize it's a divide of no merit or distinction. Our TV sets will pull through content from Facebook Live, from SnapChat, from Periscope and as-yet invented apps that grow around a new ecosystem of monetizaton. The very label "TV" will become as silly and limiting as "the smartphone." We will instead consider different sized converged screens on which we will watch different types of shows in different contexts. The snatched snackable content on the subway, the lean back entertainment in the lounge, the interactive immersion of VR.

We've always bought shows and channels as a proxy to reaching people, but now we can merely buy against audiences. What starts off as buying demographics will become addressable TV solutions where you buy a household. Face recognition or new ways to log in will allow buying of people not just homes. Soon we can add in more knowledge like payment data and search history. We will see a shift towards tightly targeted TV ads that are worth far more than we ever expected. Luxury advertisers, niche advertisers now have their chance.

In this pure digital world all advertising will be programmatically bought and placed (and that's a good thing). For years the definition of programmatic has been precise but its interpretation and meaning have been negative. Its roots in remnant inventory mean we've taken it to be synonymous with deflationary forces, when in fact it means using computers to do stuff intelligently and automatically.

Placement of TV advertising in the future will be the layering of contexts, the time of day, the stock market performance, the location viewed, the length of the show it's placed against, the content it's bookending. In fact, the very ads themselves could be rendered out programmaticaly. They will be personalized against an individual with real-time special offers, showing local stores; or ads for products that remain stuck in your Amazon wish list.

We will see new calls to action, too. The campaign architecture for TV ads has for the last few years been to drive traffic to a website. When TV ads are connected to the Internet, we could see a whole new range of calls to action; from the boring "follow X brand on Twitter," to "add to Amazon basket," or even more engaging things like adding a location to Google Maps or downloading a mobile voucher.

We've always thought about integrated campaigns as campaigns that look the same and make sense across different media. When TV, mobile, tablet and desktop all become potential screens that act together, we can imagine refocusing campaigns around the notion of moving people from upper- to lower-funnel activities and then closing the loop with a purchase. When we see how TV content will be consumed across different devices and perhaps with a dual screen like experience, we can see how actions can alter depending not the device. A brand ad for a new Samsung TV becomes a coupon to download to Apple Pay on a sequential-served mobile ad later.

The future of TV is set to ignore all assumptions, the length of ads, the way they are made, tested, interacted with, everything is about to change. It will take time, but it's the best challenge the industry has ever had. A time to blend technology, media, creativity together on the best canvas we've ever had for advertising.

Tom Goodwin (@tomfgoodwin) is EVP, Head of Innovation, at Zenith.