www. Is Online Advertising Really That Effective. com?

With the movement of consumers to online streaming services, it is valid to consider whether advertisers would also move online- chasing consumers for the greatest economic revenue. If this decision proved to be fruitful, what impact would this have on the Broadcasting Industry; who rely on advertising revenue to purchase content?

Less Revenue = Less Content... the death of the Broadcast Industry? 

What effect will it really have?

1. How Netflix currently advertise.

Netflix currently has no advertising, it relies on subscribers to pay bills. There are discussions for advertising to be introduced, but it has not been stated in what form these advertisements would take (eg: instream ads or banner). 


2. How can we project advertising revenue will be affected?

If Netflix accepts advertising, we can project that this will not significantly impact the television industry, as individuals have trained their eyes to search for content and ignore advertising. Due to this "banner 
blindness", their is a need for a new intergrated advertising approach.  

What Advertising?

 3. Ways Netflix may get around "banner blindness" of ignoring ads and intergrate advertising on the web better? 

With the viewers attention in the stream, Netflix may adopt a form of advertising which places advertisements in front of the stream- like the in-image advertising or intrusive stream advertisements on top of videos, which count down until they can be skipped or closed.

As this kills the user experience- annoying them by forcing them to experience things they are not interested in- it could turn users away from using Netflix and convince them to 'put up with' the more conventional advertising seen on Television.

Another possibility for Netflix would be to allow users to select their own options of interests, as a method of directing what ads they would be exposed to. This would reduce the frustration from users by exposing them to things they might be interested in. An example of this would be predictad.com where the search suggestions (the content that  users read and key word targeting) results in ads being highly relevant and engaging to the user (a new way of profiling users).

4.Would these approaches then impact TV advertising?

 

Due to 'Banner Blindness' and other integrated advertising approaches annoying the viewer, it seems there will not a dramatic shift of advertising moving from TV to the internet.  The television industry will therefore not collapse from lack of funding, as the benifits of advertising on online in comparison to television are not significant enough to warrant a dramatic shift. 

Conclusion.

Internet not so golden after all

While Netflix poses a challenge for the industry in regards to content. It does not pose a direct challenge of forcing advertisers to choose who to advertise with:

1. It does not yet accept any form of advertising.

2. Advertising on the internet is not yet as effective as advertising on television

Sources:

http://techcrunch.com/2011/04/29/the-future-of-advertising-will-be-integrated/

http://www.talentzoo.com/beyond-madison-ave/blog_news.php?articleID=13689

http://www.predictad.com/home/PublisherInfo.aspx

Picture Sources:

http://www.iamnotastalker.com/2010/10/29/the-fisher-sons-funeral-home-from-six-feet-under/

http://certifiedknowledge.org/blog/working-with-online-display-ads-writing-designing-networking-and-killing-banner-blindness/

http://www.koalapostersqld.com/