Google TV Ads

Peoplemeter ranks are used pretty much for everything from thereon in TV business. Sales events that take place use it as a general method of taking a stand towards ad agencies and big clients directly, but only as a stand (for ad pricing). Sales in TV is based on personal relationships between sales people and buyers (mostly ad agencies specialized in media buying). It is not uncommon, in fact it is quite common to have only a handful of ad agencies buy up in front, in bulk, ad space directly from TV Network or station and regulate sales from thereon to other agencies which are further specialized in ad placement/media buying/plans. Biggest agencies buy ad space, sell it to smaller ones which sell it to clients. Clients, in general, buy commercial/s from creative agencies and media space from other agencies (only smaller clients/budgets buy from one agency - with a good reason).

So, we have TV networks/stations (I'm not talking about really smaller ones) that always sell their space to media buying agencies which funnel their capital to that space - they sell it further down the road to their buddies. it is really hard to get into that game no matter what. It is a closed loop. TV Networks often have special/premium content which they sell off directly - this delegates to live shows, specials and large projects (Reality stepped into this pretty much). However, this being a premium content at a premium price, it is always at a special events sale only for that purpose - mostly to primary sponsors of the show/special.

There are two side liners here, in this whole business. Small productions and small stations/networks. They get the scraps of the table, if at all. They are out of the loop. Small stations usually sell off their ad space to local businesses and stuff like that - they have their own marketing departments which sells off in a classic, direct marketing approach (cold calling, small events etc.). Then there are smaller productions which can't get enough money from small stations to budget their own productions.

What follows in this scenario is that usually small productions give their content to stations "for free" in compensation for some of the ad space within that content, and station itself ads on that ad space its own ad space. So you have a show for example, independently produced, aired on the station with embeded ads that production itself sold - and wrapped around that you have station sold ads. This tend to work pretty well IF production is capable of selling off ad space, which is rarely the case and usually ends up in one or several "sponsors" of the show which pay for the production and profit margin.

Google could step in that second market if they play it right.

What amuses me though is this quote "And to get started, we'll help you create your own TV commercial for free.". Well, I don't know what kind of commercials? Maybe motion graphics/stock video/stationary holds, which you can make on your own for dirt cheap or have it made for the same amount. I work on commercials pretty much all the time (it is the most readily available type of business for directors and video/graphics independents), and to make a technically good commercial it takes A LOT of money, not because we are being fancy and want a lot of it. It is because all of the industry is set up so that it takes a lot of money - starting from renting the equipment, to people to various layers of agencies etc.

What Google will do is just the third part. We'll probably see Google TV Ads being used by ad agencies to manage their clients TV schedules.

Large companies advertising on the internet already hire an ad agency to deal with their AdWords campaigns, because they'll write the ad text/create the image/flash, and they have the market research, and they probably designed the landing page anyway.

Ad agencies love Google AdWords, they'll probably love TV Ads too. It's a tool to better manage TV ads scheduling...

Edit: Let's say you're a small business and want to advertise on TV. You still need to actually make the ad, and while this is doable with friends, a cam and a notebook, it's much easier to just hire a production company. Check the technical requirements for Google TV Ads, it's full of tech lingo. After recording the ad, you could take the video and manage the scheduling using AdWords, though.

My theory is that advertising agencies will eventually go the way of travel agencies. Big ad agencies will still exist, but they'll be forced to downsize as they face stiffer competition from the sort of decentralized indie distribution methods that make crowdsourcing work so efficiently and effectively. Look at what 99designs.com and crowdspring.com do for graphic designers, and apply that to the advertising industry; it would be fairly easy to set up a site that crowdsources advertising and rewards the actual producers with a larger share of the advertising company's advertising dollar budget. Perhaps a question of when more than if.

For the most part, billboards are old tech that needs innovation. I would be surprised if Google added something as basic as time slicing for billboard ads... that way even smaller companies could afford a visible spot on the road.

Whoever links up old advertising with new advertising will make a boatload of cash.