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Next TV Cancellation: 30-Second Commercials

BY DOUG TSURUOKA

INVESTOR'S BUSINESS DAILY

Joseph Jaffe thinks the 30-second TV commercial is dead.

Consumers skip over TV ads on their TiVos or they use search engines like Google to buy products, says Jaffe, a media consultant.

He thinks marketers who cling to the 30-second spot will end up like dinosaurs.

If Jaffe's right, it will mean big changes for the ad industry. According to industry statistics, advertisers spent over $70 billion on TV ads last year. Of that, about $45 billion went to broadcast networks. This money may shift to new types of media, such as online and wireless ads.

Jaffe has written a book about these seismic shifts in marketing. "Life After the 30-Second Spot: Energize Your Brand With a Bold Mix of Alternatives to Traditional Advertising" will hit bookstores May 20.

Some marketers are already aware that the ranks of consumers watching traditional TV ads are plunging, Jaffe says.

Others still don't get it, he says.

A sign of a shift, Jaffe says, came in March when Pepsi said it was relaunching its low-calorie soft drink, Pepsi One, through a "television-free, celebrity-free commercial diet." Pepsi plans to plug its product entirely through the Internet and other new media.

"People who think the 30-second spot is still alive might want to reconsider their statement in view of the announcement to relaunch Pepsi One without TV ads," Jaffe said.

And as TiVos and other digital video recorders spread, even more consumers will skip TV commercials, Jaffe says. According to a study by Accenture, digital video recorders will be in 40% of U.S. homes by 2009. That's up from 8% now.

Jaffe recently spoke to Investor's Business Daily about the shift.

IBD: What's happening to the 30-second TV ad?

Jaffe: There's too much clutter . . . and consumers aren't as dumb as they used to be. There also are unacceptable levels of wastage in terms of marketers paying for TV commercials that are never seen, don't work or are overexposed to consumers.

So all this combines to make the 30-second spot nothing more than wallpaper . . . background noise.

IBD: What does this mean for the ad industry?

Jaffe: According to a new study by Accenture, ad skipping on devices like TiVo and on-demand viewing (of TV shows and movies) could cost the TV industry $27 billion in lost ad revenues over the next five years. So the shift is very real.

IBD: Will people still watch TV commercials?

Jaffe: I'm not saying that all TV commercials are dead. I'm saying that the classic 30-second TV spot as the benchmark of all ad and marketing efforts is dead and has outlived its usefulness. People with devices like TiVo are watching more TV programming than ever they are just not watching ads, since these devices skip over them.

IBD: So TV ads in some form will continue?

Jaffe: Yes. There's still plenty of room for innovation and imagination. One (option) is what I call advertising on-demand where consumers receive TV ads if they request them.

IBD: You mentioned Pepsi's decision not to use TV ads in its relaunch of Pepsi One. What examples are there of other ad media supplanting the 30-second spots?

Jaffe: There are plenty of examples involving mobile phones, Internet games, DVD and other digital media. If you go to actor Christopher Walken's bio on the IMDB (Internet Movie Database) Web site, you'll see that he lists a video game called "Ripper" as part of his professional credits. This is a game that came out well over 10 years ago. The question is why do Hollywood movie stars realize the importance of these online games as marketing media whereas mainstream marketers haven't?

IBD: What are other examples of new types of marketing?

Jaffe: Bono from the rock group U2 recently told the entire audience at a concert in L.A. to take out their cell phones. There was a sea of light. It was like the Zippo lighter had been reinvented for the 21st century. Bono then asked everyone with a cell phone to send the text word "unit" to a specific number. This was all designed to support his personal efforts to help people in Africa, but it's also an example of the marketing and communicative power of mobile phones.

IBD: What's the marketing moral of this story?

Jaffe: Traditional marketers have continued to cling to using celebrities in their 30-second TV spots almost like security blankets. That's why all you see are stars like Sarah Jessica Parker in 30-second TV ads for The Gap. But the irony is that celebrities like Bono and Chris Walken have figured out how to energize their own brands by turning to new marketing like Internet games and mobile phones. U2's Bono has hit on the idea of community marketing, which I define as marketing to and through a community of consumers (like U2 fans).

IBD: Will other big-name companies follow Pepsi's lead in turning away from TV ads?

Jaffe: I would say yes. But the answer isn't to completely eradicate TV ads. The answer is to be smarter about the media mixes that are ultimately optimized or deployed by advertisers. TV is no longer the star of the show. It's a member of the supporting cast. It's just another tool in the tool kit.



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