Advertising on interactive TV (iTV) is still in its infancy, but a report by Jupiter Research says the medium is going to have a huge growth spurt over the next four years.
Jupiter, a unit of Darien, Conn.-based Jupermedia Corp., predicts that total iTV advertising revenue will reach $25 million this year. But it will grow almost 100-fold by 2007 to $2.3 billion, according to Jupiter's forecast. On a household basis, that equates to about $1 per home in 2003 jumping to $39 per home in '07.
Why the huge spurt, especially given that many advertisers don't see interactive advertising as a must? Well, Jupiter believes that view will change dramatically as advertisers become more familiar with iTV technology and applications.
Some already are. Case in point: Johnson & Johnson, which bought a multiple-platform, multi-brand iTV sponsorship from ABC linked to a prime time interactive TV special, The View: His/Her Body Test in June.
According to Jupiter analyst Lydia Loizides, who reviewed results of the J&J project, 54,868 viewers interacted across three platforms, including personal computer users, Wink-enabled viewers, and viewers linked to a separate wireless-phone–based technology known as short message service (SMS).
According to Loizides's analysis, viewers interacting with the program through one of the ITV platforms spent more time watching the show, paid more attention to and had better brand recall of the commercials, and in general reported having a "much better viewing experience" than viewers tuning in and watching the program passively (that is, without using of any of the iTV applications).
The results showed, for example, that the passive viewers spent an average 43.2 minutes watching the program, vs. 54.3 minutes for those interacting with it via PC and 45.9 minutes watching via the Wink system. Phone-based users were tuned in an average 46.3 minutes.
Overall, PC and Wink users had far better recall of specific advertisers and sponsors: 82% for PC users, 60% for Wink watchers and just 26% for the couch potatoes. The phone-based group had slightly better recall than the potatoes at 34%.
Just over half the PC viewers felt that interactivity produced a better viewing experience. Just under 40% of the Wink watchers felt the same way; just 22% of the phone users could say the same.
But, overall, Loizides calculates that 45% of the iTV users had what they considered a better viewing experience.
One conclusion she draws from the J&J test is that fewer brands per sponsorship event are probably better than more. J&J promoted 15 brands during The View special, and some fared better than others. For example, iTV users had better recall of pain reliever Tylenol, while passive viewers had better recall of the Band-Aid brand. "There is greater opportunity to delve deeper into messaging and brand satisfaction with fewer products," Loizides noted.