MARCH 14, 2007: Google CEO Eric Schmidt believes in the future of the “set-top box,” a future brimming with (big) television advertising dollars for Google.
Google famously wants to organize ALL the world’s information and ALL the world’s advertising, including TV ads. Google touts it can “add value to TV advertising by making this important medium more relevant for users.”
But, if Google succeeds in bringing its “targeted, measurable advertising” to ALL the world’s home entertainment systems, would that be a good thing? NO, so says Nick Grouf, CEO, Spot Runner, “the first Internet-based ad agency that makes it easy and affordable for local businesses to advertise on TV.”
On the heels of Google’s public acknowledgement that it is “running a small, early phase trial” of a cable TV ad delivery system, I spoke with Grouf to get his industry-insider take on what Google’s television advertising end-game may be.Grouf is not a disinterested party; He proudly declares in the Spot Runner “Here’s our story” pitch that he and Spot Runner co-founder David Waxman seek to “revolutionize the advertising industry with the launch of Spot Runner.”
Sound Googley familiar? Google Ceo Eric Schmidt’s “long-term fantasy” is “we walk up to you and you give us, say, $10 million and we'll completely allocate it for you across different media and ad types.”
I began my chat with Grouf by asking if Spot Runner is a direct competitor to Google. Grouf responded “You got it.”
What is Spot Runner’s “revolutionary” approach to TV advertising?
Spot Runner offers a complete solution for television advertising—commercial production, media planning and media buying—in a single turn-key, self-service system. The entire process, which traditionally takes months and hundreds of thousands of dollars, now takes just days at a fraction of the cost.
The Spot Runner television advertising value proposition is similar to the Google positioning of its Audio Ads radio advertising product.
What about Google Television? Google CEO Eric Schmidt:
There are many reasons to believe that the targeting technology that we have invented can really apply well, that people will pay, advertisers in particular, will pay much higher rates for ads that are targeted than ones that are untargeted. So for example, set-top boxes can help you target to end users and the set-top boxes are now IP addressable. So there's a lot of evidence that as we link our systems into the systems of people who are operators, we can get another leg up on targeting and ultimately provide both a more useful advertising experience for the end user and also a better advertising experience for the advertiser themselves in terms of conversion.
Will everything really be all good in Google targeted television advertising land?The Center for Digital Democracy warns beware “The Set-Top Box”:
Often described as the most valuable square foot of real-estate in the world, the set-top box is about to become even more valuable in the broadband era, as the centerpiece of a new system of interactive television, e-commerce, and Internet services. And yet the set-top is also largely a black box, seemingly beyond the control of Washington to regulate and certainly beyond the ability of most consumers to understand. Can we afford to cede so much control to network operators, who, literally left to their own devices, will transform the intelligent set-top box into a vending machine for proprietary content and closely monitored transactions?
Grouf believes a resounding NO.
“Watching people watching TV,” is how Grouf characterized the prospective Google targeted TV advertising platform to me. Google will seek to leverage knowledge of viewership habits, Grouf believes, by using set-top box data collected without explicit consent of subscribers to “target ads according to the viewer.”
Google’s end-game? Manipulate viewer data to sell ads at a higher price, according to Grouf.
I asked Grouf if the Spot Runner system poses any personal privacy implications. The Spot Runner “proprietary media planning engine” does not entail set-top box data manipulation, Grouf conveyed:
Spot Runner creates customized media plans by using some basic information entered by the advertiser, such as their industry, target demographics and budget. The entire process, which can traditionally take months and hundreds of thousands of dollars, now takes just days and at a fraction of the cost. Spot Runner manages each account by securing the ad buy, placing and tracking the ads, and analyzing viewership and demographic information. All of it is available online - a simple mouse click away.
Google's "Internet-based ad agency" services are also "a simple mouse click away." Let the TV advertising battle begin!