MBPT Spotlight: The Entertainment Landscape Is Changing—It’s Time to Embrace New Advertising Models Too

"It's Not TV, It's HBO..."

Who knew almost 20 years ago when HBO created its famous tagline it would be precedent for how original premium content would be consumed in 2015 and beyond. That line may now read — "It's Not TV, It's HBO, Netflix, Amazon, Hulu, YouTube and all other streaming content."

This became evident with the recent Emmy nominations, as HBO received 126 nominations, Netflix received 34, Amazon got 12 and all broadcast TV (ABC, CBS, Fox and NBC) only received 159 nominations. This showcased that the creative freedom to create "water cooler" content is abundant at the newest creators and distributors of content.

They not only produce great shows, but they provide consumers with a better viewing experience, binge-viewing options and the ability to watch on whatever device they choose, and at their convenience. Importantly, consumers increasingly prefer no commercial interruptions, so the standard 22 minutes an hour filled with TV advertising spots are no longer as effective to increase brand awareness of a product or a service.

The rapid adoption of tablets and mobile devices is another factor driving the content circle even faster. After all, when TV came along in the '50s in the United States, it took 20 years for household penetration to hit 50%; when tablets came along, it took only three years domestically for these devices to be universally adopted!

According to Deloitte’s 8thDigital Democracy Study, an average household has seven connected devices. Millennials represent nearly 33% of the U.S. population over age 13, and more than one-third of those between the ages of 14 and 66. 

This generation is disrupting traditional television viewing and entertainment models by watching the vast majority of their TV and film content online rather than through television or Blu-ray/DVDs. A whopping 56% of the TV and film entertainment watching by millennials aged 14-24 is on computer, smartphone, tablet or a gaming device — only 44% is via TV. Slightly older millennials (in the 24-30 age range) view 47% of their film and TV content on those alternative devices.

There is an earthquake happening in the “TV” content world now that is no different than what the music industry went through in the 2000s with the advent of iTunes, Pandora, Spotify and others. 

While it’s easy to think about what this means for programmers and their relationship with their distribution partners, there is also a change coming in the advertising world too. This may be one of the reasons that the advertising upfront for broadcast and cable networks is breaking later and why so much money is being left on the sidelines.

There is $22 billion of media dollars in review at global advertising holding companies around the world from top brands such as Coca-Cola, P&G, Volkswagen, Citi, and more. This is not because the media agencies are not properly allocating their budgets, it’s that TV is not TV anymore, period.

In my opinion, traditional TV will be extinct within 10 years as will be all linear and library content, bringing choice and control to new levels. Live sports or news, library shows and films both new and old will be delivered straight to your device.

So, what brands are really asking for help with in their “media reviews” is predicting what new digital platforms will rise, where to find their customers in the new world order and how and what measurement will be relevant when tracking purchases based on new media tools vs. traditional advertising spots.

The most progressive companies are all meeting directly with talent agencies, technology companies, content creators and social metrics firms to name a few, to plot for the changing landscape. That’s just the start of the revolution.

Four years ago, when I was the president of the Norm Marshall Group, the leading brand integration agency, we sold our business to Bill Gates’ Corbis with the idea to create a marketplace for embedding. We knew that technology had an opportunity to bring efficiency and scale to the marketplace for product integration and embedding brands into content. It evolved into what we call BEN, or the Branded Entertainment Network. It was an idea that was embraced by a man known for disruption.

Today, Corbis Entertainment’s BEN is a world where integrating brands into premium cable, over-the-top, film and social media influencer content is done at scale. These are all non-ad supported “verticals/buys” and they are also the only way a brand can interact with original content. In just one year since launch, the streaming revolution has grown dramatically; our marketplace is embracing this change and facilitating a new way for advertisers and brands to participate. 

How is the manifesting itself in real terms? One example is Ray Donovan. He is back and better than ever as the Hollywood fixer in the hit Showtime series now in its third season. Also returning to the show are many of the brands from the Heineken portfolio, including Heineken, Tecate and Dos Equis. 

As part of a category-exclusive deal for season three put together by Corbis and their BEN marketplace for embedding, in the opening episode, several of the principal characters are all seen drinking and holding the great Heineken products both at a party and in a bar scene. It is traditional for Heineken to look for quality programming and upscale audiences and Ray Donovan delivers both. Throughout the season there will be several very organic and tasteful moments where the cast will be seen with the full spectrum of Heineken brands.

But even categories not as ubiquitous as automotive or beer can be integrated organically as evidenced by a recent multi-story arc on HBO’s The Newsroom. Last season, The Newsroom featured the $24,000 Bloomberg Terminal that traders and financial firms use to analyze economic data all around the globe. The fictional financial reporter, Sloan Sabbith, played by Olivia Munn, used the terminal in a pivotal plot that reoccurs throughout six episodes about the acquisition of her ACN network in a hostile takeover. There are insert shots of real economic data, Bloomberg ID, verbal mentions and true story line integration.

By being tied to the pop culture HBO hit, all arranged by Corbis through the BEN marketplace, Bloomberg was able to attract a more relevant younger audience for their real terminals in the real world.

With all of this change, perhaps the new media age tagline should read—“it’s no longer product placement, it is embedding a new ‘daypart’ for the new media world.”

While the creators and distributors of content look for solutions to the challenge of streaming content and how best to reach their consumers, it would be prudent to continue to consider brand embedding.

This is the new means of “advertising” and an effective way to ensure that brands connect with viewers in the authentic and meaningful way—a way in which the millennial consumer, in particular, is demanding.

As chief revenue officer of Corbis, a Bill Gates company, Owens was active in the creation and launch of the Branded Entertainment Network, which is part of Corbis Entertainment. BEN is a platform aimed at helping brands and media buyers gain access to branded integration and product placement opportunities across traditional and digital entertainment. The interactive platform helps brands match up TV shows, movies, digital productions and celebrities to help showcase their products. Corbis Entertainment clients include Heineken, General Motors, Microsoft and Hallmark, among others.