What? Jack, you’re nuts. Well, maybe. Maybe I am nuts. Maybe I’m not. Check my track record. In 2000, the day TiVo launched, I predicted it would suffer the same demise as 8-track tape player. There was little doubt, at least in my mind, that an appliance solely dedicated to recording and storing television shows would become obsolete.
Today I had the honor of sitting on a panel at the TV of Tomorrow show here in New York. It was an amazing panel that included luminaries from Hulu, Comcast, Meredith, Sinclair and Syncbak.
Given the Herculean task of keeping up with this group, I decided to talk about pie. Yep. Pie
You see, no matter what happens in the TV of Tomorrow, then, like today, people will eat pie. So, because people eat pie, the people who make the pies need to advertise. Pie makers the world over need to get the word out. And, unless they are Sara Lee, they’re likely a small business.
Today I talked about Kathy’s Pies in Marion, Iowa
Kathy’s pies are nothing short of amazing. Kathy’s Pies is a small business. In the TV of Tomorrow, which is actually today, Kathy can go toe-to-toe with Sara Lee. She can literally deliver the one-two punch, no holds barred. How? Simple. All she needs is $500.
This is why the TV of Tomorrow is today
Kathy’s $500 goes just as far as Sara Lee’s $5 million. Here’s how. When you watch TV via OTT, it’s kind of like having a personal broadcast. The ads you see are likely different than the ads I see or your other friends see and so on. Big advertisers go for big audiences. Kathy’s Pies, though, wants to have a one-on-one relationship with every pie eater within 20 miles of her bakery.
Big advertisers need big audiences. Small advertisers can thrive with small audiences
To advertise on OTT, Kathy would buy ad avails on a CPM basis, or cost per thousand impressions (the number of times the ad is seen). Let’s charge Kathy a $25 CPM or $0.025 every time her ad plays. Kathy agrees with the CPM price and says “I have a $500 budget for the month.”
Before the TV of Today, Kathy’s $500 would have put her ads on the Sunday morning real estate showcase show that nobody watches. Her ads would be seen by the entire DMA, though customers way up in Decorah (111.7 miles away) are not likely going to jump the car and head Kathy’s on a whim.
With the TV of Today, Kathy’s $500 gets her in 20,000 one-on-one, very personal conversations (targeted ads)
In other words, Kathy’s $500 is spent reaching 20,000 people, most likely people in close proximity to her bakery. Kathy’s $500 over time turns into $1,000, then $2,000, maybe more. And, the TV of Today isn’t just about pie. It’s about cookies, and coffee and Yoga and piano lessons and anything else you get locally. Like TiVo and the 8-track, I guarantee local advertisers will thrive in the TV of Tomorrow, or today.
The TV of Tomorrow, and Today, is all About Pie. It’s always been about the pie.