Will CPA Stamp Out CPM on Television, Too?

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As a follow up to the recent article written by Kiran Aditham entitled, “Will CPA Stamp Out CPM? Industry Pros Argue Why Per Action Makes a Better Impression,” it is interesting to note that CPA is also gaining ground in other advertising mediums such as television. While CPA is not nearly as prevalent on Television as on the Internet, there is one company looking to change that. REVShare – television’s largest cost-per-action advertising network has spent 17 years building relationships with more than 1000 television properties that engage in a television version of CPA Advertising.

Recently, I wrote about one of the more serious challenges that lie ahead for the television industry and the important role that CPA will play. An already embattled television industry is now bracing for the inevitability that will come as of February 17, 2009. This is the final transition date set by Congress for U.S. television broadcasters to revert to broadcast digital signals. While the benefits of this technology, such as HDTV, are well known, many in the advertising world are cringing at what Multicasting — the new ability for broadcasters to deliver multiple channels of programming — will mean for an industry already struggling with media fragmentation.

One example of Multicasting comes from our friends at PBS who are already offering consumers a choice between children’s programming, do-it-yourself shows, adult education, popular documentaries, or other programming — all from the same broadcaster.

As new channels of programming are rolled out by thousands of local broadcast stations across the U.S., the amount of television advertising inventory, and competition for eyeballs, will increase to an unprecedented level in the history of the medium. This technology showdown may very well represent a checkmate for today’s two major television advertising models, Nielsen’s CPM model and Direct Response Television, both of which face their own unique challenges.

How Nielsen will rate all the new channels, afforded by such breakthroughs in technology, is the subject of much debate. What is clear is that after 20 years, Nielsen is still struggling to rate local cable programming which really only began the current media fragmentation tidal wave. As local phone companies are building yet another platform for television distribution, and on the eve of the Multicasting evolution, many television advertisers are feeling very boxed in by Nielsen’s apparent struggle to navigate these new waters.

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