TV’s Next Commercial Break Might Be the Pause in Your Binge (EXCLUSIVE)

December 4, 2018

TV viewers may dislike commercial breaks, but Madison Avenue soon hopes to get them to watch ads during a very different kind of interruption.

Coca-Cola struck advertising gold in 1929 by introducing the slogan, “The Pause That Refreshes.” In 2019, there is new hope in a similar concept: a refreshing pause that carries a word from a sponsor. Consumers have more power these days to avoid ads that get in the way of the viewing of their favorite shows, but maybe — just maybe — they will show interest in commercials that come on screen during interludes of their own choosing from long streaming sessions or on-demand playback.

Imagine an ad for soda or beer that comes on the screen just as you decide to stop the action during a run of an episode of “Black-ish” on Hulu to go to the kitchen for a snack, or a pitch for toilet paper that begins to move in the moments before you choose to halt the video stream for a bathroom break. And yet, there’s no guarantee viewers will welcome “pause-vertising” any more than they do the current crop of 30-second pitches.

Some outlets are willing to bet they will. “As binge-viewing happens more and more, it’s natural they are going to want to pause,” says Jeremy Helfand, vice president and head of advertising platforms for Hulu, speaking of modern-day couch potatoes. Hulu intends to unveil what it calls “pause ads” in 2019. When a user chooses to stretch, or get a snack, he says, “it’s a natural break in the storytelling experience.”

AT&T also has hopes to use the pause to lend new momentum to TV advertising. The company, which owns DirecTV and U-verse, expects to launch technology next year that puts a full-motion video on a screen when a user decides to take a respite. “We know you’re going to capture 100% viewability when they pause and unpause,” says Matt Van Houten, vice president of product at Xandr Media, AT&T’s advertising division. “There’s a lot of value in that experience.”

Many consumers think they can escape the usual barrage of TV pitches with new streaming-video services that run only a few ads, and sometimes even none. That notion has been bolstered in recent months by efforts from companies like NBCUniversal, which has experimented with running fewer ads in primetime. But TV watchers may have to recalibrate their view. Media companies don’t want to lose the billions of dollars advertisers pay them each year. And consumers would have to submit to much higher prices for access to their favorite shows if commercials didn’t play some part in the overall experience. Indeed, Hulu offers its service at a higher price if customers want to avoid commercials completely.

At a September conference held for advertisers, AT&T executives made the case that even new forms of video entertainment – including streaming – require ad support. “If we are to continue this pace of developing content of this quality in these volumes, then we need advertising to pay for some of the content,”said Brian Lesser, chief executive of the company’s Xandr unit, while speaking to reporters at the event. “I don’t believe – nor does anybody on the team believe – that subscription video on demand services could possibly pay for all the content being developed” without relying on money from advertising.

The plans for pauses suggest new power in the media industry could go to those outlets that can establish a more direct tie to viewers. A linear TV network, after all, can’t necessarily make a regular event out of someone choosing to run to the kitchen for a bowl of pretzels.

Even some of those more traditional media bastions are experimenting with new TV technology as well. CBS has tested technology that lets advertisers add tailored messages to national commercials seen by viewers using certain connected TVs. A retailer with a sale at an outlet 30 miles away could add a note to someone who lives close by, and a restaurant might tout its delivery service in a particular city or town. The network also is testing a system that lets it “split” ad slots — sending an ad for a lower-priced car to a household owned by a young couple, or an ad for high-end technology to a TV watched by high-income consumers.

The media companies will have to do more than gamble on consumers’ receptivity to the concept of seeing an ad at stops of their own choosing. “Just because you can doesn’t mean you should,” cautions Tim Halon, CEO of Vetere Group, a media and advertising consultancy. He sees a lot of sense in “pause ads” that play off the moment when they are watched or are tailored to particular consumer occasions, but “if it’s simply inserting, let’s say a reverse-mortgage ad with a direct-response phone number? I don’t know if that aids the consumer experience.”

Indeed, streaming fans have already balked at seeing promos turn up between videos. Some Netflix aficionados earlier this year protested a test in which the streaming giant flashed promos for its various programs in the seconds between the end of one selection and the start of another. Could real pitches from outside advertisers be next? Netflix has never run traditional commercials on its services and its executives have said they do not want to start doing so.

Media executives say they will step carefully. “You do not want to deliver a longform advertisement in this situation,” says Hulu’s Gelfand. “I think you have seconds to deliver your message effectively.” He says the company expects to have “more than half of advertising revenue come from non-disruptive experiences” over the next three years.

Ever since the DVR made its way into living rooms last decade, Madison Avenue has worked furiously to find new ways to keep commercials from being skipped or ignored. As more TV viewers indulged in fast-forwarding past ad breaks, marketers tried to get them to slow down by tucking secret codes and special scenes into their spots. Now they must identify even more aggressive methods of getting audiences to pay attention to their pitches.

“Pause ads” have surfaced in the past. When companies like TiVo and ReplayTV were introducing early versions of the DVR to the marketplace, Coca-Cola and Universal Pictures signed up to place banner on ads on ReplayTV screens whenever customers opted to pause the show they had recorded. Today’s technology lets marketers add more sound and motion the proceedings. AT&T’s Van Houten suggests viewers might even seen interactive pause ads that allow them to “telescope” to more information from the advertiser with the click of a remote.

Viewers could balk at having ads thrust at them in this new milieu, but the AT&T executive suggests that next year’s “pause ads” could simply be the next iteration of the “flying toaster,” those low-res screen savers that popped up whenever a user of the Apple Macintosh let the machine sit too long. In time, he suggests, consumers might prefer the pause pitches to other forms of TV commercials.

Making the connection clear for consumers that the ads help subsidize their viewing will be important says Hanlon, so many of the new commercials might have to make clear they help to bring programming to the screen.

Are viewers ready for a pause in viewing that becomes a moment of selling? “In the end, consumers will vote with their feet,” says Brian Sheehan, a professor of advertising at Syracuse University’s SI Newhouse School of Public Communications. Or perhaps their remotes. And definitely their wallets.

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