Consider high-end web sites carefully for value, warns new media report

Independent producers should be careful about building too-rich web sites for broadcasters, according to the author of a new report commissioned by the Bell Broadcast and New Media Fund (Bell Fund). Industry veteran Catherine Warren tells Canadian NEW MEDIA that producers, broadcasters, advertisers and others have been convinced of the value of television-related web properties, but the industry as a whole is still struggling to understand how innovative sites need to be to add value. In the Bell Fund report, BEYOND RATINGS - New Metrics for New Media, author Warren says work remains to be done to better capitalize on web offerings related to TV shows by creating better links between the two and working to find the right blend of interactivity and information. "If there are…too many innovative features, then those sites become very expensive. Then it’s hard to ascertain their return on investment," she says in an interview.Warren stresses that one model that should be looked to in formulating the recipe is fan sites - third-party web content posted by fans of a television show. "Going back to what makes a fan site popular, it’s that community involvement, that opportunity to submit songs, scripts, to bond with other people who are looking at you as a show expert, that kind of thing. Those are relatively inexpensive productions and yet have tremendous appeal. Voting, polling - tremendous appeal. Then it becomes very easy to say ‘here’s the specific return on investment on this particular community node, or this particular interactive component.’ Some of the experimental stuff, while I think it’s very worthwhile, is perhaps missing the boat in a business model sense or in a revenue sense." Work needed on basic marketingOne area where both broadcasters and independent producers need to work harder, Warren says, is in basic marketing. For example, she says, a review of web sites done for the report found few cross-linkages between broadcaster, third-party and independent producer sites. She asks: "Why aren’t these things just being done as a matter of course? If a successful television show has a multiplicity of rich media sites, has fan sites, has mini-sites, why not aggregate these? Why not become the go-to place for your audience to just get all the bumph on it? "It was actually gobsmacking the way very basic marketing 101 had not even been applied to the Internet, let alone viral marketing and other things. There’s a failure to exploit once money has been spent, once deals have been struck. It’s not manifesting itself to the benefit of the audience or to the benefit of the bottom line." Despite these and other areas requiring fine-tuning, however, the overall story of the relationship between independent producers and broadcasters is a good one. For example, BEYOND RATINGS finds that brand-building and cross-promotion rank higher than revenue when it comes to key objectives for TV show web sites. Further, all parties agree that web sites are an important part of meeting audience expectations. The report notes: "Overall, the industry players remain committed to refining the models and metrics associated with TV show web sites - as the online business is definitely here for the long haul." Based on a blended survey of executives and web sites, Warren found that for both television and the web, eyeballs were the most important metric of success, with money a distant second concern. Web sites, half of executives asked agreed, are expected to generate profits, with a vast majority of respondents agreeing that an increase of 1-5% would be a success in 2003. In keeping with the Bell Fund’s recent decision to change its focus away from innovation (CNM, July 11/03), Warren also says the report shows independent producers must still hone their pitch to financial considerations. "A lot of the independent producers are still spending a lot of time educating and not spending enough time selling. In order to sell effectively - this comes from the advertising agencies that we interviewed - they really need to get the television broadcast sales teams on board. And in order to do that, they need to really understand the market for their particular site in terms of everything from advertising to ecommerce. And I think ecommerce is a missing link here. A lot more innovation needs to be applied to the business side of things as opposed to what I call the interactive side of things." Advertising agencies, Warren tells CNM, are still struggling to understand what the web adds to television shows. "There are two things that are happening here with advertising. One is that the value proposition and the appreciation for television has changed because of the web. People are no longer as impressed by gross ratings points and no longer value things like the Nielsens in the same way - because they can have more. They can have one-to-one. They can have demographics and psychographics. That’s number one. "Number two is web sites associated with television properties have not been as effectively integrated into the mix as they might be. The advertising agencies need help. They need the broadcasters and the web producers to actually construct the value proposition in a better way. Other people are doing it better right now… Whereas maybe in the past one broadcaster would lose an advertiser to another broadcaster, now a broadcaster is losing an advertiser to Nike’s web site, to the Gap’s web site, or a fashion house web site. So the competition and the landscape has changed, and the pitch has not kept pace." The report, whose findings are based on an analysis of 55 web sites and interviews with two dozen executives in the field, is just a first step as the Bell Fund seeks to do further research. Andra Sheffer, executive director of the fund, tells CNM that successive reports will be more concrete. "We’re actually seeing this as a launching pad as we do other research and follow-up work," she says. "How much of that we can do and how far we can go is going to be dependent on financing and timing and the general interest of the industry… It’ll have to get much more in detail, I think. We’ve kind of skimmed the surface here and we’ve got an idea of what’s working, what’s not working, the general direction. But we have to go further and really build into more concrete, very specific things that are successful and not successful." Sheffer spoke with CNM about the report prior to news that the Bell Fund faces a 40% cut as a result of a recent CRTC ruling (see story in this issue). Further research along the lines of BEYOND RATINGS could be put on hold, she later said, as the fund struggles to find ways to fund projects in the wake of that blow. Catherine Warren is a member of the Bell Fund’s board of directors.

Consider high-end web sites carefully for value, warns new media report

Broadcast | July 24, 2003

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