1. Online Behavioral Targeted Advertising Key Component to
Comcast Acquisition of NBC
After over a year of deliberation, The Federal Communications Commission and the Justice
Department decided to allow Comcast to buy 51% of NBC Universal from GE. With the recent
explosion of Hulu, Netflix and other online media services, Comcast is doing everything it can to
mitigate the obsolescence of its television broadcasting. One of the conditions, however, is that
Comcast had to allow rivals to license NBC programming, including its most popular shows (The
Office, 30 Rock, etc.). This expands the network of companies that can generate online ad
revenue off NBC programming.
There is a change in the paradigm occurring. Networks used to make shows available online as
an added benefit, but now with advances in broadband technology, consumer appetite and
advertising delivery systems – online media is not only a requirement, but is starting to trump
cable broadcast programming in many areas. With services like Hulu offering its premium
package at only $8 dollars a month, “cutting the cord” on the $100/month cable package is
looking a lot more attractive. Additionally, more progressive outlets for à la carte style
purchasing of media entertainment, such as Apple and Amazon, are likely experiencing a
competitive threat from the new “free-to-consumer” or “low-cost” alternatives.
What is in it for the companies? How can you “give away” online media entertainment at such a
low price? Improvements in advertising delivery systems have allowed for significantly more
targeted ads to be placed. Gone are the days where people were boxed only by demographic
data. Now companies use cookies, survey information and even your social media profile to put
the right ads in front of you! The more “targeted” an ad can be, the more an advertiser is willing
to pay a publisher for that space. Advances in behavioral targeting have enabled ads to change
content and placement based on consumer interests and where they are in the buying cycle.
Let me walk you through an example of how behavioral targeting is driving this movement:
You go into an electronics retailer and sign up for the store’s “free” consumer card (e.g. Best
Buy Rewards Zone) to earn discounts.
They record your purchasing information and send you e-mails to let you know about different
offerings, your total savings, or even just to confirm your membership, etc.
You view one of the e-mails and a cookie is placed on your computer. This cookie identifies all
your purchasing information and a profile for you, including demographic information.
You have a history of buying video games for your PlayStation 2.
You watch your favorite show on Hulu, from home, at your convenience, for free (or for a small
monthly fee).
You see ads for PlayStation 3 on Hulu. While you are waiting for your TV show to continue, you
click on the PlayStation 3 ad on Hulu.
You are now identified as an interested buyer for PlayStation 3 and see ads for the PlayStation
3 wherever you go on the web (maybe even inside your e-mail).
You finally buy a PlayStation 3.
Now on Hulu and all over the web you see advertisements for games and accessories for the
PlayStation 3. The games are the types of games you liked to buy for the PlayStation 2.
1/2

2. Coincidence…definitely not.Scary? A little. Profitable for publishers of websites and media
entertainment? Absolutely. The best part is, consumers are lining up to take part in the “free
entertainment”. While Comcast may have acquired NBC to avoid obsolescence and remain on
the cutting edge, it would be foolish to think the behavioral targeting opportunities isn’t a core
driver here. Where else can you imagine a business paying billions of dollars to take an
eventual subscription revenue cut from $100 down to $8 per month??? The value in online
entertainment for businesses is behavioral targeting.
Sean is the founder and a principal of Jaroop, a leading provider of online targeted advertising
solutions. He specializes in helping companies leverage the web to build profitable businesses.
Sean focuses on evaluating client situations and opportunities as if he were a partner in the
client’s business. This approach allows Sean to make recommendations that align with the
company’s strategy and are appropriate given the firm’s values and customer base.
Sean can be contacted through Jaroop’s website or at 860-357-2060.
http://www.jaroop.com
http://www.jamesreilly.co.uk/blog/online-behavioral-targeted-advertising-key-component-to-com
cast-acquisition-of-nbc/
2/2
Powered by TCPDF (www.tcpdf.org)