June 27, 2005

What Cable TV Can Teach Us About Online Customer Personalization

The cable industry is always looking for ways to better target advertising to customers, as a way, of course, to raise advertising revenue.

Cable companies want to know who is watching, what they are watching and when they are watching so that advertisers can send dog food ads to dog food owners and Irish greeting cards to Irish people.

Guess what? If you have an online business you don't have to struggle with this like cable operators do but you can automatically trigger ads/offers to the specific customer you want - raising sales and profits. Unfortunately many web sites do not harness the POWER of online customization, as Amazon.com (and others) does and if they don't they are missing out. It's not only revenues/profits but also better customer support and service.

Business Week writes Time Warner Cable Inc. (TWX ) will soon begin testing a system designed by software firm Invidi Technologies Inc. that uses the digital set-top cable box to track what each TV in any house has on. It's expected to go into a household test by yearend, with other cable companies following in 2006. By analyzing where a viewer channel surfs, Invidi says the system can figure out the age, gender, and probable interests of the viewer. Most important, the system then matches TV ads to the consumer based on what might actually interest them.

That's a long way from merely trying to match ads to TV programs that seem likely to attract consumers an advertiser desires. If a 50-year-old father and his 14-year-old daughter each tuned into a Seinfeld rerun on different TV sets, for example, Invidi's system would send each a different ad during the same commercial break. The father might see a pitch for after-shave lotion while his daughter would see one for acne medicine. If this experiment in hyper-targeting works, it could spread fast. As the share of cable TV households with digital set-top boxes rather than analog boxes rises from 38% at the end of 2004 to nearly 100% by 2007 as part of federal law to make all TV digital, operators such as Time Warner and Comcast Corp. (CMCSA ) hopes to make consumer sharp-shooting commonplace. Read the full article here

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