Sky Digital's pioneering of interactive TV advertising with the famous Chicken Tonight execution nearly seven years ago seemed an answer to marketers' prayers - a new genre of TV ads that combined viewer brand engagement with directly measurable product sales uplift.
Since then the advent of video-on-demand and PVRs should have increased the attraction of interactive communication through the telly. Yet, while direct response advertisers in financial, motor and travel categories have warmly embraced the potential of iTV advertising, other brand advertisers, such as FMCGs, have been less enthusiastic.
Viewer reluctance to interrupt their programme watching by going onto the digital space through the red button, cost of customer response and a lack of creative agency enthusiasm for the genre have all been blamed for the failure of iTV ads to cross over into the mainstream.
Yet the advance of IPTV and other technical developments may yet see interactive ads take on far bigger significance in marketing communications.
BSkyB has long claimed that its PVR, Sky+, could be a weapon for the advertising industry, rather than its assassin. The company's sales house, Sky Media, is now briefing agencies about the potential benefits of its latest invention, the Sky+ mark II, which, while already providing early adopters with HD technology, is soon to be unleashed as an IPTV beast, with thousands of hours of VOD programmes waiting to be turned on, thanks to a broadband connection in the back.
BT Vision, scheduled to launch this autumn, will use a similar concept, using the Freeview platform and cable company NTL-Telewest, to be rebranded Virgin next year.
Sky has told agencies that from next year it will offer a new type of iTV ad, known as long-form advertising. As well as being able to press the red button to go into ads, viewers will be able to press green to save longer-format ads to their Sky+ planner menu and watch later on. In the US, cable network Comcast has been signing deals with major advertisers which allow viewers to watch VOD programming for free, containing such long-form ads, as an alternative to paying to view.
"There's been an assumption that viewers will pay for all these developments, but I think that's wrong," says Nigel Walley, managing director of digital consultancy Decipher. "Experience in the US has shown that people don't want to pay for content, but they are willing to put up with advertising to get it free. The technology of the PVR is going to create the next generation TV ad. Interactive TV has led the way, but we're coming to the end of what we can do with the existing technology."
Furthermore, the release of Skyview's audience research data can tell advertisers not only who pushes red, for how long and from which demographic they belong, but also, in the case of FMCG goods, if they bought them.
"It's a far more powerful piece of research than Barb," says Steven Hess, managing partner of iTV company Weapon 7, adding that such measurability is going to make interactive campaigns even more important.
"Advertising with iTV is a way of reaching people across all these technologies. All advertising is going to be interactive. The debate is not about iTV versus IPTV, but how interactive each TV platform actually is," says Hess, whose company has carried out campaigns for the likes of Microsoft, T-Mobile and Dulux.
"We all know the threat from these technologies is going to be huge," admits Toby Hack, head of interactivity at OMD. "How you integrate ads into a world that's a fundamentally an on-demand world is a major challenge."
But Andy Benningfield, director of broadcast at BJK&E, whose interactive clients include car giant Mercedes, says people should not get carried away by the speed of change.
"The fact is that most people haven't got Sky and most people don't even know what an interactive ad is," he says. "I still don't see the death of the 30-second spot and I don't see the death of the red button. I do see IPTV running alongside it."
Just how exciting interactive advertising's future is depends on agencies and broadcasters coming up with new business models, possibly in line with what has happened in the States. But unlike street crime and TV programmes not everything in media follows that route
THE US STORY
Advertisers in the US have been closely involved with the launch of second generation iTV.
Cable company Comcast and CBS last month signed a deal with General Motors Corp to show episodes of hit show Survivor, which it had been offering on demand for 99 cents, for free.
They included three GM commercials that run before, in the middle and at the end of the shows and also encourage viewers to access an on-demand virtual showroom, including videos of cars, trucks and SUVs in action.
Meanwhile, PVR manufacturer Tivo has signed major deals with Omnicom and Interpublic to back its product.
The company is offering advertiser-branded programming on its device and giving agencies second-by-second audience measurement research.
This article was first published on Media Week