The $499 price point seems a tad steep at first, but it’s cheap when compared to a MacBook. And oh, what the iPad can do…. It’s an e-book reader! It’s a music player! It’s a portable theater with a big enough screen that we old guys can see it! And if you want to talk internet, you can take it with you!

I want one.

But back to business, which in my case is crafting video-based direct response advertising for TV and the web. Where the mere rumor of a new Apple toy triggers giddy adoration, my industry’s direct response TV products are often targets of satire. But in the markets they compete, they’re game-changers too. People spend billions because these products perform functions that customers value.

To succeed, DRTV firms and Apple must both create products that fulfill unmet needs. And Apple — which in its early days was itself an infomercial client–pitches its products virtues as aggressively.

Can Advertising Piggyback on Apple’s Success?

For marketers, the iPad is a promising ad channel. We’ve clamored for a decade for a mobile advertising platform that delivers messages and response with trackable reliability. There’s considerable enthusiasm that the iPad may qualify.

Mobile ad network Transpera offers a representative take: “the sleek, portable device offers consumers a viewing experience that rivals a laptop with the intimacy and relevancy of the mobile phone…. the iPad can deliver Transpera’s ‘Peek’ pre-roll and post-roll video units, as well as Clickable interactive video ad units. ”

Of course, TV and the web do such things routinely. What’s new is doing it interactively on a mobile device.

Apple’s bandwagon is a good place to chill. The touch-screen based iPhone and its app-friendly software made cell phones high-functioning, and turned competitors into copycats. The ubiquitous iPod did nothing less than revolutionize music consumption — as well as inspire the iTunes store that today dominates music sales.

Based on that track record, it’s not unreasonable to project a similar arc for the iPad. Advertisers who get on board quickly could be poised for a long happy ride.

What does the iPad offer that the iPhone does not? In the immortal words of Lucy Van Pelt: real estate. iPad advertising enthusiasts believe the 9.7 inch screen will make video more visible. That’s particularly important in direct response television, where product demonstrations move the merchandise. Viewers are rarely impressed by what they can’t see, and you can’t see much detail on a two-inch telephone screen.

Because Apple is positioning the iPad as a portable web browser and media device, pundits predict a big flood of media apps–many already rolled out for the iPhone and iPod Touch. “Portable interactive internet television,” informitv calls it. Excellent! Wherever there’s TV, we usually see DR out in front of it.

From Those Wonderful Folks Who Brought You Apple TV

But as is so often the case on technology’s bleeding edge, “new” is not guaranteed useful. From an ad industry viewpoint, each iPad opportunity is balanced by a threat. While iPad TV apps could indeed be the best platform for mobile video advertising, app discovery remains sketchy at best. Customers have to find them, then install them. You won’t bump into “TV ads” just by tapping the on button.

Apple learned from the iPhone that marrying devices to service providers (AT&T in this case) limits its reach. So the iPad will launch “unlocked,” functional with any mobile data provider. But if you’re too far away from a wi-fi or an AT&T hotspot, you’ll need a pricey 3G subscription to benefit fully from the iPad’s obvious differentiator: big screen mobility.

Apple’s previous i-Marvels, both the iPod and the iPhone, prevent sensible people from dismissing the Pad. But redefining product categories — and industries — will be a far harder slog this time. As a DRTV-friendly platform, it will be tougher still.

According to Apple Insider, “some publishers are skeptical of Apple’s iPad business model, which sees the company giving 70 percent of revenue to content providers, but not sharing any personal information about subscribers.”

If that’s true, then I’m skeptical too. DRTV sales success depends heavily on data-driven targeting. If Apple withholds its customers’ information, we may as well jump back a generation and embrace CPM pricing. That may be okay for brand building and maintenance, but for not for moving products from the warehouse to customers.

The second strike against iPad as a video ad powerhouse is based on control of your content. For television, we can film what we want, and buy time where we want — directly — on many hundreds of stations and cable networks. Web advertising offers similar freedom — and thousands more media outlets — though we usually conduct ad buys through ad network middlemen.

If the Apple seers are correct and “the app” is the best method to deliver advertising on iPads, we inevitably must cede some control. It’s not a deal-breaker, of course — early iPad adopters will initially choose from 140,000 apps, so it’s not like Apple enforces an app gold standard — but Apple could seek a cut, or charge fees if it wants… or simply remove your app from its store. (In fairness, Apple has given no indication it plans to do such a thing, but it does like to control whatever variables it can.)

If there’s a third strike, it’s not one specific to DRTV — or even to advertising. It’s inherent to the product category Apple wants iPad to revolutionize, popularize and own. Apple’s iPods are easy to use, efficient and as portable as electronics get. A two-inch screen is a small price to pay for putting music, video, and the web in your pocket. You can put e-books there too (there’s an app for that, you know).

Apple’s MacBooks deliver high value also, including everything the iPod Touch does, plus marvelous applications suites on bigger hi-def displays. More to the point, MacBooks are already portable — though they do require much bigger totes.

Financially, the iPad differentiates itself from MacBooks by its much lower price ($499 vs. a minimum of $1199). Functionally, it separates itself from an iPod Touch chiefly by its screen size.

Then again, ever since Goldilocks started nosing around the homesteads of bears, there’s been big money in marketing different sizes. A Ford Focus gets you from Point A to Point B as successfully as an Expedition. But if the latter’s too big and the former’s too small, perhaps a mid-size sedan is just right. So let me be the first to suggest that the iPad is positioned to become the Ford Taurus of portable media devices.

But revolutionary? iPods pushed Sony’s Discmen off the radar because they delivered a better user experience. Not only were they smaller and easier to carry, by making room for a thousand more songs (or audiobook chapters or those funky new podcasts), your window of fresh entertainment was no longer limited to an 80 minute CD.

The iPad, conversely, embeds compromise — easier to carry than a Macbook, but more cumbersome than an iPod Touch. As an e-reader, the iPad’s bigger screen won’t deter portability: readers are accustomed to carrying around hardcovers with roughly equal dimensions — and the iPad is considerably thinner.

As a portable media device, though, the size is a bit awkward. Try to pocket it, and you risk looking like a fool with your pants on the ground. Price point not withstanding, why not just stick with a notebook for media consumption?

But most of us have learned not to second-guess Steve Job’s magical product design and marketing abilities. And many prognosticators insist the iPad will do for (or “to”) print what the iPod did for music: completely destroy and disrupt a century old industry. So will video advertising be a significant part of this new “print” model? We’re betting it will, and soon to dominate it.

In the first half of 2009, display accounted for only 34% of U.S. online ad spend. Of that, only 38% sold with CPM pricing.

So the quid pro quo for the majority of online display advertisers has become the accountability and results that click-through and conversion-based pricing delivers.

Once the online display gurus stopped ringing their hands, they freed them for typing. Not necessarily better ads, mind you, but defenses of their format and the CPM pricing models that brands treat with growing skepticism.

In a curious way, it’s heartening to observe industry insiders remember what they do for a living. When authoring campaigns for highly competitive clients, we often drop the gloves and start swinging. My beer is lite-er, their burger makes you fatter, my phone map is denser, my kid’s computer can beat up your dad’s computer.

Online display disciples have embraced this approach lately by suggesting (more or less) that while their format isn’t perfect, it at least doesn’t disqualify itself with embarrassingly low click-through data.

Embarrassing? In direct response — TV especially, but online as well — ad buyers at the very least can compare ad spend to direct sales income (a figure that’s inevitably underreported, as it doesn’t include sales through other channels).

No sane advertiser will challenge this common sense staple: if you sell more in merchandise than you spend on the advertising, you know that the format is working.

Defending the format is trickier for the online display crowd, which seems to theorize weekly against data. So I ask them: Where’s the beef?

You find business success in numbers, not nicely turned phrases. While a good slogan can work wonders, you still need some numbers to prove that they actually move merchandise.

It wasn’t even a generation ago that marketers trumpeted online formats for the strength of their precise measurability. Ten years later, with less favorable CTRs, we learn that numbers were perhaps overrated and that we don’t really need instant accountability, especially given display’s mighty branding powers. Unfortunately, branding takes time — curiously a bit longer than the length of a budgeted campaign.

Still, many crusaders for the online display CPM model parrot numbers when it suits them. They’re happy to challenge direct response models quoting click-through-rates that fall south of 0.1%, and a finding that a mere 8% of U.S. online users account for 85% of all clicks.

And they seem positively giddy about comScore’s “Whither the Click?” study that claims a 65% lift in site visitation in the week following the first exposure to a display campaign and an “incremental online sales lift” of 27%. Exciting and buzzworthy numbers!

But if I were considering an online display investment, the worst number is the legion of display defenders who have embraced defeatist reasoning. The argument is that since current online metrics don’t adequately measure what’s important — awareness, positive feelings and so forth — we should simply trot out different metrics that sound better (even though they too fail to reliably measure impact).

The comScore study responds to the assumption that click-based metrics don’t capture the breadth and depth of variables that boost brand awareness and drive purchase decisions.

Yet by attributing every sale to the appearance of an online display campaign (a 27% online sales lift!), it repeats the oversimplification it presumably counters. Chances are that TV, radio and billboards played a role in that sales lift as well. Who runs single medium campaigns?

From a metrics standpoint, the minute you acknowledge the interplay of dozens of variables, you diminish the importance of any one, including the variable that you want to spotlight. So like PC telling Mac he should “trust me,” too many online display salesmen ask marketing directors not to obsess so much about numbers — seemingly because the product is still struggling to define a reliable case-proving metric.

If you’re going to employ a particular ad channel, you should play to its strengths and do it profitably. The Internet is a lean-forward medium. People click purposefully, focusing so intently on the objects of their search, that they don’t take their eyes off the road.

Product-centric websites are a must because consumers actively seek product info online. Nobody seeks out display ads.

While ad aversion is problematic for all formats, it’s endemic to online display. And that’s not even factoring in the  problem on which The Wall Street Journal has reported. In this scam, ad networks deliver code-only “displays” that consumers literally can’t see, but that are nonetheless tallied and billed in CPM accounting.

And the ever-popular entreaties for “better creative”? Well, better ads might mask some online display symptoms, but they won’t effect cures. Fact is, some ad formats are inherently inferior for accomplishing certain purposes.

I butter my bread with direct response television, but know better than to lecture Pepsico to sell more Mountain Dew by inviting frat boys to call now (even if they packaged Dew in a keg).

An equally apparent fact is that the purpose-driven nature of the Internet is simply not conducive to awareness by osmosis.

Those of us who were around then remember certain skits pretty vividly. And for those of you who didn’t see Dan Aykroyd puree fish in the Bass-O-Matic, there’s Hulu.

That’s the first DRTV parody I remember seeing, the granddaddy of a phenomenon that grows bigger each year. Look up “infomercial parody” on YouTube, and you’ll get 1,400 links. Search “infomercials” for nearly 17,000 options. You can waste devote a whole day browsing DRTV takeoffs, and you’ll spend equal time smiling and scowling. The bad thing about many of these advertising paeans is that “users” aren’t as funny or creative as they think. The good thing is that they tell us a lot about consumers views on products and advertising.”

So here is your starter set of “Lessons To Be Gleaned Watching Direct Response Television Knockoffs Online:”

1) Sincerity doesn’t matter—imitation’s still flattery.

Pick ten random YouTube infomercial send-ups, and you conclude pretty quickly the creators think the format is dumb. (Of course, none of these clips run 28½ minutes, so they aren’t infomercials at all, they’re “spots” … but enough know-it-all lecturing.) Our amateur auteurs think the format is dumb, the hosts are dumb, and the products are dumb. And that anybody who buys what they’re selling is dumb. With a clever creative, they imply, you can talk people into buying a brick. Me? I look at these cynics like an 11-year-old boy who keeps punching a girl on her shoulder every recess. Though his attention doesn’t take the best form, the attention is constant because he really kind of likes her. He just hasn’t learned to express himself well.

2) Copycat commercials prove direct response works because they are a direct response. Ironic, isn’t it? DRTV’s purpose is to inspire viewers to take action. Admittedly, it’s better when they pick up the phone, but picking up a camera is revealing as well. Thousands are so entranced by undisguised direct selling that they’re seemingly compelled to try one themselves. Anyone can do this stuff, right?

3) DRTV isn’t as easy as it looks. It’s hardly industry snobbery to imply that many of these spoofs are unwatchable (I’ll spare you the links, because they’re not hard to find). This is inevitable when two teenagers shoot film in their kitchens without scripts. What is surprising is how often the performance and production values are actually passable, when the content decisions are deplorably sophomoric (click at your own risk). While rude language and crude topics are an oft-repeating oeuvre for young males, the spoofs would be funnier if they walked the line of taste with more subtlety. Not that SNL or Mad TV parodies are exactly sophisticated, but they do prove professionals are better suited to the task. The very best takeoffs, unsurprisingly, come from people who create real spots for a living. In other cases—like Father Vic for Soul Wow—they are real spots.

4) Never underestimate the power of personality. Of the most popular infomercial parodies, about half feature a faux Billy Mays, the other half a wannabe “Shamwow Vince” Offer. And, as Yogi Berra might say, the remaining third feature a product. Of course, being famous for being a commercial spokesperson isn’t new. Remember John Cameron Swayze keep on ticking for Timex? Anita Bryant and her Florida Sunshine Tree? Marlin Perkins for Mutual of Omaha? Fabio for I Can’t Believe It’s Not Butter? (Okay, just kidding about that one.) The point is that on YouTube at least, more people play at being Billy Mays than at being Albert Pujols, Tom Brokaw, and Will Smith put together. The pitchman is clearly a resonant character.

5) DRTV is as mainstream as America gets. Today it’s Billy, Vince, and the Snuggie. A generation ago, it was Popeil, Robbins, and Ginsu Knives. Just say the names, and people know what you’re talking about. In an era where so many crave their Famous Fifteen, direct response is the strongest of the TV reality genres—a survivor that will outlast Survivor. It’s so ingrained, in fact, that mainstreaming’s chief institution—the high school—embraces infomercials as teaching tools. You can find hundreds of class assignments now posted on YouTube, where the task was to create an infomercial. Camcordered recitations of iambic pentameter?

Well, it is YouTube, so you’ll find some—but not nearly so many. Contemporary students don’t want to read Shakespeare, or any Homer that isn’t a Simpson. The closest that most students ever come to Charles Dickens is Mr. Magoo’s Christmas Carol. So teachers turn to accessible infomercials to teach cultural analysis and critical thinking. Students not only complete these assignments, they share them online and thus join the cultural conversation … willingly! Okay, like, I, um, ya know … I know what yer thinkin? But it’s a start.

6) DRTV is a one-stop communications course. Colleges use them too. After only five minutes browsing through .edu sites, you can find a dozen higher learning institutions—including such stalwarts as Princeton, M.I.T. and Indiana—that offer courses asking students to create infomercials. Such a project can teach several things. Foremost are effective ad techniques: eye-popping visuals, attention grabbing copy, the power of demonstrations, and the irresistible persuasiveness of focusing upon benefits (even the brick “infomercial” knew enough to shine its spotlight on those). Ultimately, they feature calls to action, general advertising’s oft-neglected invitations to buy. Perhaps not the most noble topic for many professors who wander through academe’s hallways, but tell it to the folks in the unemployment line. To those hardest hit by our sagging economy, there’s nothing quite so wonderful as buying.

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It has been a consistently valuable outlet for DRTV programming, and was the first cable network to sign an exclusive media contract for overnight long form avails with a direct response agency (my own, as it happened) back in 1985.

With the debut of Pitchmen a week ago Wednesday night, the relationship is cozier than ever. The program shadows the industry’s most prominent personalities—Billy Mays and Anthony Sullivan—for a behind-the-scenes look at direct response television. To the uninitiated, it offers enlightening glimpses into the process of transforming ideas into products that sell. First and foremost an entertainment program, Pitchmen ramps up the drama from the start. In documentary style, it follows the fates of two inventors, who pitch their ideas to DRTV’s Dynamic Duo. The hope is that the medium can make their new products as ubiquitous as Oxi-Clean (whose ads aired twice in the hour-long episode).

We learn quickly that few products likely have what it takes. Even useful ones—like a clever baby bottle holder that helps 5- to 10-month-old babies feed themselves—aren’t likely to flourish. As Telebrands’ mastermind A.J. Khubani asserts, “the market is just too small.”

When the creator of the GPS Pal presents a simple container for relocating GPS units from windshields to cupholders, “Sully” (now that Anthony’s a dramatic protagonist, he shares the warm, fuzzy nickname industry insiders have known for years) remarks that “we look for products that solve a common problem.” Quite right. But Billy is concerned that it lacks a “wow” factor. He similarly inquires of the other featured product—shoe insoles made with shock-absorbent “Impact Gel—“is it demonstrable?” All of this comes straight from page one of any DRTV playbook. But once Matt the inventor smashes his gel-protected hand with a big honking hammer, Billy’s question is answered, demonstrably and affirmatively.

We see many scenes common to the DRTV process: strategy meetings, rudimentary market research (“real people giving real opinions,” as Sullivan describes it); testing creatives by airing polished spots; and the determining importance of value-laden offers. This point provides the show’s best dramatic conflict, with the insole inventor reluctant to drop price points, and Billy insisting that all products he sells go for $19.95. Those “but wait, there’s more” moments have purpose: “we lump ‘em up … we really give ‘em a value.”

As Pitchmen concludes, we see the hallmark of DRTV in plain view: checking call center data to see how many sales the two-minute spots drove. The narrator makes the stakes clear: “this information will tell them the future of Impact Gel.” Happily for Matt, the spots earned 4 to 1 MER (media efficiency ration) returning four thousand dollars in sales for every one thousand spent upon media time. Basically, a gold mine.

Pitchmen’s real significance is what it reveals about contemporary marketing trends. First, it confirms that DRTV is more mainstreamed than ever. If you’re reading this, you’d likely already find Pitchmen quite interesting. But Discovery isn’t targeting the Ad Pro niche. In one respect, DRTV and TV itself are two sides of one coin: a primary goal is to appeal to the masses. Infomercials, their 1- and 2-minute short form cousins, and DRTV “celebrity” hosts are familiar and of interest to millions. It’s no stretch to identify Billy Mays as a star—which Pitchmen confirms in a car show scene where he wanders around signing autographs.

The second trend Pitchmen illustrates is the ongoing merging of entertainment and advertising. We all know our nomenclature is purposefully backward. The ads are the real programs; the “entertainment” is an envelope to enable the ad views. As consumers catch on to this and rebel with their skip buttons, advertisers are aggressively blurring old divisions. In Pitchmen, the blurring has multiple layers. The show is not only an advertising wrapper, it promotes advertising itself. It promotes the GPS Pal and Impact Gel insoles. It promotes Billy, and Anthony, and Telebrands, whose brands will all benefit from exposure that’s basically free.

Got an idea, John Q? Forget calling your local ad agency… call a cable network programming VP!

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A recent Advertising Age article  bemoans a proliferation of “belly fat” banners that are cropping up increasingly online. Published by “some of the web’s shadiest advertisers,” more and more websites are apparently so revenue-starved that gluttony is newly enticing.

But as GA ad budgets shrivel, direct response advertisers thrive – both on and offline. First, of course, the formats perform. Second, with boardrooms now focused on all kinds of accountability, measurable results are understandably tempting. Third, as TV stations and networks grapple to fill empty ad slots, the laws of supply and demand favor DR, allowing different sorts of advertisers to gobble up plentiful inventory. As DRTV maven A.J. Khubani describes some of his clients’ move into prime-time TV: “we’re getting beachfront property at trailer park prices.”

An infomercial marketer dissing trailer parks? My, my, it is a new world. That such a comment is no longer immediately ironic is a certain sign that direct response advertising, at least in the offline TV world, is more accepted and respected than ever. And even worse for general advertising’s traditional standard-bearers is the fact that cost information is leaking.

The New York Times reports that some DRTV advertisers pay as little as “5 percent of what a general advertiser would.” Admittedly, Ped Egg, Steam Buddy and the like receive these huge discounts through last-minute fire-sales of unsold inventory. But media-buying savvy is DRTV business as usual. Vigilant media buyers strike quickly when opportunity knocks.

Online, ad rates are dropping, propelled by supply and demand, so general advertisers should be happy. Display ads are still moving merchandise, so direct response advertisers remain happy. Enough consumers obviously are happy, or they wouldn’t click and buy the featured products in such impressively large quantities. So why all the fuss about style?

Well, that’s easy. According to the media elite, mini-infomercials and belly fat banners are just so … well … ewwww.

Who wants to open a news site and see a protruding tummy in all its muffin-top glory? Whatever happened to the good old days when health ads featured models who’d already conquered their problems? I mean, you didn’t see Jared chow down all his Subways at a shirtless and hefty 340.

It might have made for a pretty big ad, though.

According to tradition’s many unwritten rules, NBC’s Biggest Loser has utterly no business becoming a powerhouse franchise. Its stars aren’t the world’s Hayden Panetierres or its Ashley and Mary-Kate Olsens; its biggest stars are the country’s biggest people. Like direct response sales figures, the ratings don’t lie: people aren’t offended by unaesthetic realities. The folks who squirm at bulging bellies—or Anthony Sullivan or Billy Mays, for that matter—are undoubtedly angry that they no longer set cultural tastes. After all, it’s hard to keep that corner office as a Madison Av Mad Man when the unexceptional public starts to outsell your sizzle.

You have to wonder if brand advertisers are taking this in. How would you like to be Coca-Cola and learn that you’re laying out nearly twenty times more for your spot than one later in the program that the Nicer Dicer folks bought? Or what about the GM exec who learns that his stylish web banner promising zero percent financing pales in terms of click-throughs to unvarnished cellulite? It’s a hard fact to accept that reality-based ad creative generates immediate response better than fiction. But if more in the brand communities started acting that way, we’d witness a cultural earthquake – or at least more palatable CTR’s.

Generationally speaking, it wasn’t all that long ago that a whole lot of pudginess wasn’t unseemly at all—it was stylish. That extra layer suggested you didn’t physically labor, so your big belly was a badge (and a bulge) of success. To be sure, this was well before weekly warnings from Surgeons General helped to alter these norms, but the point is that entrenched fashions change.

If the pundits are right, and the advertising that funds both the airwaves and the internet are facing hostile takeovers from aggressive and uncultured rubes, big advertisers and agencies should act on an old-fashioned adage: if you can’t beat ‘em, join ‘em. Don’t hang on too long to the old realities. Depict today’s real people with contemporary problems—as well as the products that solve them—and you’ll soon be creating consumers’ new truths. And greater response.

Rather than off-road to some mountaintop plateau that (in reality) demanded a big helicopter, show truck drivers on-roading to Home Depot—and successfully loading up cumbersome drywall. Yes, towing airplanes with pickups makes pretty good visuals, but so too do two stout Midwesterners sliding comfortably into their truck’s roomy cabs. Chances are, the truck-buying audience has a whole lot more “Biggest Losers” than people stumbling across aircraft that need a quick tow. C’mon, advertisers … embrace the belly fat! And look the truth square in the button. There’s no more receptive an audience than one that knows you accept it and respect it, despite all its flaws.

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In our innovate-or-whither landscape, you’d expect this august group to be master tacticians in employing the strategies that marketing gurus proclaim best. These days that’s interactivity. But a tour of these giants’ websites challenge that assumption. And occasionally induce a nice nap.

Brand site interactivity comes in two favorite flavors: communication with peers (social networking, video sharing, etc.), and interaction with engaging gadgets (casual gaming, do-it-yourself virals, etc). The first approach builds trust. The second—exemplified by the Simpsonizer, Elf Yourself, and countless others—builds big bursts of traffic. But the country’s biggest brands don’t consistently embrace either, which makes for a methodological muddle.

The Future Is Now

Atop the Fortune 500 sits Walmart, and at the top of its website sits … advertising? Walmart runs banners for products it sells, yet these standalone brands are potential distractions. Still, it’s trying to push products, which seems almost an afterthought among many of its Fortune 10 brethren. Walmart displays products on its website as it does in its aisles—singling some out, and singing their virtues. Unique among the 500’s top ten, its home page highlights “Connect and Share” networking elements: asking and answering questions, sharing stories, blogging about babies, and so on. Most notably, Walmart has gone Amazonian, and includes consumer reviews for each item it sells. If a product performs poorly, peer opinion will sink sales. It will also give consumers good reason to trust Walmart, and seek substitutes elsewhere on site.

General Electric, #6 on Fortune’s leader board, engages online visitors with a prominent jaw-dropping gimmick. A thumbnail click lets you “see a digital hologram come to life in your hands.” You print off an image and use it and a webcam to “test drive” a wind turbine (shown here if your computer can’t handle it). At first glance, the “wow” factor seems little different in purpose than other buzzworthy web tricks. But this relates thematically to the company’s mission, and illustrates its “imagination at work” motto in action.

The Future Is Distant

Unfortunately, as we continue our tour, interactivity and innovation fade rather quickly from view. General Motors (#4) and Ford (#7) offer networking components, but viewers must work hard to find them. You jump to a specific product line site—Chevrolet, for instance—and provide contact information to gain access to social networking features. The marketing purpose is clear: interactivity delivers data, and data delivers dollars. But privacy-minded consumers often deflect the feared pitch barrage with the gazillionth fake identity created on Hotmail or Yahoo! Worse, GM actually bills itself as “Corporate Website.” If that doesn’t fire your desire for new wheels, what will? Ford at least spotlights its F-150 model as Motor Trend’s Truck of the Year, giving the modest click interaction a sales-centric purpose.

We Are The World

Exxon Mobil (#2), Chevron (#3) and Conoco Phillips (#5) sell gasoline and energy, but this isn’t Job One at their image-driven websites (minor exception: Exxon Mobil links to a local gas station finder). We instead see a focus on financial reports, investor links, safety concerns and—inevitably—reverent odes to responsible environment practices.

This is in part understandable. The mainstream media has so bludgeoned these firms for alleged crimes against nature that most Americans now assume that big business is bad for our planet. Don’t believe me? Type “Exxon” into Google’s search box. The second suggestion is “Valdez”—an incident nearly twenty years old. Understandably, energy companies want to combat that image, but they over-react by positioning themselves more as firms that don’t destroy wildlife, than as providers of products that consumers can choose. While environmental responsibility is of course crucial, it’s not the best move from a marketing standpoint to imply a disinterest in selling products such as gasoline, while seeming to cater to Wall Street investors.

We’re Here For You … Somewhere.

The remaining companies that round out Fortune’s Top Ten are Citi Group (#8), Bank of America (#9), and AT&T (#10). All sell goods and services of substantial consumer interest, yet their websites look little different than they might have five years ago. The overall impression is like walking into sprawling corporate headquarters. While you’ll eventually find what you need, before you get started you must pause at the ground floor and study a building directory. In lieu of the ubiquitous plastic-lettered signs that identify what departments reside on each floor, the websites provide twenty to thirty links to get you to the right floor—where you then stare at a new sign and restart the process.

Because so many of these sites’ practices run contrary to sales principles, you start to wonder what they’re up to. You don’t get to be a Fortune 10 by being stupid, so something else is clearly in play. Could it be that with so many companies facing CEO scrutiny or bailout ridicule that engaging sales-centric websites might seem insufficiently sober? With so many consumers either cautious or in crisis, perhaps gravitas is the right tone. After all, an advergame showing how a Citibank card funds a tropical vacation might be tragically tone-deaf right now.

But don’t kid yourself. It likely would sell some more credit cards.

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The first time you saw them, you didn’t much care where they went. The important thing was that they went somewhere new, and they went there with astonishing 14.4 modem speed. The thrill was discovery, and we all wasted hours just noodling around. Quickly, we grew accustomed to learning by clicking. We found favorite spots, and trusted that whatever was linked there was probably worth seeing. In online advertising, Adotas plays this role. You can learn a great deal by just clicking around here.

Just like that first day you discovered the web, hyperlinked serendipity still yields profitable insight. To prove the point, I spent a few hours checking out random brand sites featured on another of my favorite online playgrounds: the Hawthorne Videoactive Report. The site posts thumbnailed screen captures of e-commerce and brand sites that industry friends and colleagues find interesting. Old-fashioned hyperlinks whisk you instantly to real companies’ real advertising—a real-time ad tactics laboratory.

What you’ll quickly discover is that very different companies often market the same way. While brand sites are unquestionably varied, it doesn’t take much link-hopping to uncover common threads:

Exposure rules. In a world in which virals now infest all computers, putting brand names before consumers often trumps the message’s message. Awareness is good, but I worry that bad-mannered brands invite negative associations. A visit to Burger King’s Angry-Gram—the Gilbert Gottfried of websites—invites visitors to fill out a Mad-Libs styled telegram. When finished, an animated spicy-hot hamburger shouts insults at whoever you send it. J.C. Penney’s Doghouse also embraces a negative dynamic—though admittedly amusing—in which aggrieved spouses and friends consign bad-acting partners to the proverbial doghouse. But Penney’s offers a profitable way out: forgiveness via bracelets and diamonds.

Social media immerses consumers in brands. As the BK and Penney’s sites illustrate, brands increasingly invite people to participate. The logic is simple. Give visitors something engaging to do and to share, and good feelings will rub off on the brand—whatever the message’s content.

Jag Jeans’ Jag Studio immerses visitors by letting them run photo shoots of beautiful models. One male and one female pose seductively as you maneuver a virtual camera and click away. You can create virtual albums, or download your favorite photo to serve as your (Jag-branded) wallpaper. Keep visitors busy and they not only engage the brand longer, they literally may take the brand with them—or send it to others as an Angry-Gram. At least Jag’s creative sends a sales-purposed message: people who wear its jeans are photo shoot worthy.

Production values matter. Much more, in fact, than online gurus suggest. The Jag site is visually sophisticated, and the only bad photo you can take results from mis-framing or mis–timing your shot. Angry-Gram is also impressive technically. Creating a cranky talking burger is challenging enough—but it’s got to be easier than programming it to yell what you tell it (thanks to a surprisingly long list of word options). A Volkswagen site loads up video thumbnails that move across the screen to simulate bad traffic situations the car helps you conquer.

The 42 Good Things site that promotes Samsung’s Omnia telephone features dozens of highly-polished video vignettes, each of them promoting an Omnia feature—just what a sales-minded website should do. Sprint’s Plug Into Now site highlights a similarly dizzying feature set. While its page full of widgets makes you feel like you’ve fallen into the big ball at Epcot, the site illustrates in a glance the full scope of what Sprint products offer—weather, games, scores, videos, news, statistics … perhaps even a phone call or two.

Brand interactions should be easy and fun. Each of these brand sites are intentionally easy to use. Make an activity too complicated—or a game too hard to win—and casual surfers will bolt. That, surely, is why the game on the Sprint site resembles Pong, not Halo. Volkswagen’s game is also easy to play. Even if you miss the one-in-five chance of answering your question correctly, the site just alerts you to try it again. If you can’t conquer this challenge, you shouldn’t drive a golf cart, much less a car. And Samsung’s Omnia site? It’s a simple branded treasure hunt: what cool function will I learn about this time?

Names matter less than they should. You’d think a brand’s name should be prominent in a branding effort, but in this random sample, only Sprint and Jag keep their names front and center in their sites’ URLs. Jag-Jeans.com is no mystery at all. Now.Sprint.com keeps you guessing a bit more, but certainly less so than Angry-Gram.com, or BewareOfTheDoghouse.com.

The reasoning, presumably, is to entice visitors with the sites’ wacky antics—sites people might avoid if they suspected that brands will jump in and start selling. But it’s not like “42 Good Things” is any easier to remember than “Omnia,” so a worthy website might just as well confidently claim credit. If you feel any need to disguise your site’s origins, you probably shouldn’t let it live in the first place.

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For the past few years, interactive advertising has become for ad agencies what exercise plans are to overweight uncles: terrific ideas—necessities even—that we announce with a big splash, then later repeat with more hope than belief.

It’s time to break that cycle. Be it resolved: 2009 is the year.

While online ad providers aggressively press their case that the web is interactive advertising’s natural home, TV is the real growth medium. Forrester Research reports that despite online TV viewing’s continued expansion, it still accounts for a paltry 3.5 percent of a typical web user’s overall viewing. So if interactive ad models are ever to become truly dominant, the best opportunity remains in TV.

Yes, I know, TV visionaries have been making such predictions for three decades—yet the closest thing to interactivity that we seem to have achieved is people like me talking to other people like me about the format’s potential. As for actual interactive advertising involving actual viewers? Not so much.

But as I survey the ad landscape for interactive TV options in 2009, it appears that for the first time, there’s almost as much action as talk.

Actual Interactive TV Ad Model #1: TiVo delivers remote-clickable ads to the ad skippers. TiVo has launched its Pause Menu, which is equally revolutionary and retrograde. The revolution is in solving a problem that it helped to create—the ability to zip past commercials when time-shifting programs. Every DVR viewer pauses the action at some point, and when TiVo viewers do it, now an ad message can appear on the Pause Menu. What’s retrograde is the presentation—a temporary surrender of sight, sound and motion in favor of static ad copy. But for broadband-connected customers, the Pause Menu links to TiVo’s Swivel Search feature that lets viewers explore more extensive ad content without losing their place in the time-shifted program. The number of interactive clickers will be small for awhile, but since the Pause Menu’s clicks are unquestionably opt-in, every lead they deliver are those coveted highly-qualified ones.

Actual Interactive TV Ad Model #2: TiVo helps viewers order Domino’s pizza. TiVo has struggled financially of late, but you can’t help but root for a company that fights back through innovation. The Domino’s partnership includes advertising “entry points” throughout TiVo’s user interface. When clicked, viewers can customize a pizza on-screen—choosing both crust type and toppings—then enter their address for delivery. Back-end operations send the order to the nearest Domino’s, which then handles the baking and delivery as usual. Like any interactive endeavor, TiVo and Domino’s have embraced a direct response model, creating a nice friendship with benefits. Viewers can order meals more conveniently than ever. Domino’s earns profit from immediate (and trackable) sales. And TiVo becomes a more attractive ad venue by keeping viewers glued to the sets where the ads are. It goes without saying that if you order at the start of a sitcom, you’ll know without checking if it comes in 30 minutes or less.

Actual Interactive TV Ad Model #3: Backchannelmedia links TV to the web. Boston’s Backchannelmedia is also past talking about interactive TV … it’s testing it today. So far, the most successful click-through interactive TV ads have been limited to deep-pocketed programmers like DISH. But Backchannel’s Project New England moves this model to local broadcast stations—traditionally strong markets for DRTV. The TV-To-Internet Click-Through platform takes a little time to set up, but once done, its benefits are clear. Icons appear on-screen that invite clicking viewers to engage in a variety of tasks they can later complete through a personal web portal: download files, bookmark home pages, send content to their mobile devices, and best of all, place advertised items into shopping carts. Wisely, Backchannel has been careful to leave viewers in charge. The platform not only enables true interactivity, it does so without interrupting the programming. The response is what’s time-shifted so the show can go on.

Unless you are one of the innovators, the actual appearance of long-rumored alternatives can be unnerving. But truly successful products like traditional advertising rarely disappear. They evolve. As ROI-potent as DRTV has become, it still hasn’t killed the brand spot (though direct response elements creep ever more aggressively into even the big brands’ commercials). Nor will interactive TV ads kill any old ad model that delivers results.

So my new year’s resolution for interactive TV is to root for the possibilities to keep becoming realities—ones I can use in conjunction with the models I know work reliably. In my case, that’s DRTV—repeatedly proven to have the strength to withstand storm force winds … of change. Amazing!

Author of over 125 published articles, Tim Hawthorne is Founder, Chairman and Executive Creative Director of Hawthorne Direct, a full service DRTV and New Media ad agency founded in 1986. Since then Hawthorne has produced or managed over 800 Direct Response TV campaigns for clients such as Apple, Braun, Discover Card, Time-Life, Nissan, Lawn Boy, Nikon, Oreck, Bose, the Heifer International. Tim is a co-founder of the Electronic Retailing Association, has delivered over 100 speeches worldwide and is the author of the definitive DRTV book The Complete Guide to Infomercial Marketing. A cum laude graduate of Harvard, Tim was honored with the prestigious “Lifetime Achievement Award” by the Electronic Retailing Association (ERA) in 2006.

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There are several reasons for consumers’ tepid embrace of “web-ized TV” and for marketers’ wait-and-see skepticism. But while we remain in the speculation stage, there are just as many reasons why Widget Channel may overcome the tough challenges—and why advertisers may embrace this new medium.

The problem: Technological buy-in takes time. Because Widget Channel requires a specific Intel chip, widespread rollout will require years. Intel must first get its chip into TVs and set-top boxes—which consumers must then buy in sufficient number. The promise: Intel is ubiquitous in consumer electronics. If it’s pushing this chip, many products will use it. And the timing is right. With the analog-to-digital transition now in full swing, consumers are eager to upgrade their gear. Pay TV services, of course, offer set-top box upgrades routinely.

The problem: Consumer media consumption is highly fragmented. Many advertisers adjust to dwindling TV ratings by transferring ad spend to the online culprit. So why would Big Television enable a new medium that distracts viewers more? The promise: Intel’s technology brief states, “The user interface is designed to complement, rather than distract from, traditional TV viewing.” Perhaps. Even with the widget gallery consigned to a bottom-of-the-screen “dock” and the widgets’ operations displayed in a left-of-screen sidebar, the interface still is distracting. But that isn’t necessarily bad. Similar to the information-rich sidebar and text crawl that ESPN News, CNBC and Bloomberg run during commercial pods, program-related content may keep restless viewers from wandering. Bigger TV sets factor in too. There’s room for additional content without sacrificing main image quality.

The problem: DVRs and ad-blocking software have accustomed media consumers to control their advertising consumption. Many TV viewers won’t opt in to widgets that appear to be marketing tools. The promise: Intel’s technology brief tackles this issue head-on, claiming that the Widget Gallery service “can include an advertising engine.” So viewers who want the freedom to check stock quotes or display Flickr photos while watching NCIS, may have to accept advertising as fair exchange for customized content. More important, “content aware widgets” could offer the relevance that online ad networks tout. Desirable sidebar content could itself be supported by advertising. Theoretically, Widget Channel makes it possible to balance push advertising with pull advertising.

The problem: Widget Channel can’t offer advertisers direct access to consumers if programming providers are gatekeepers. Your killer widget is useless if programmers won’t let viewers see it. But cable and satellite companies have little reason to embrace the new Channel if they don’t receive compensation. The promise: Wisely, Widget Channel is open to big TV partners. Comcast, reportedly, is already working toward a January launch of an electronic program guide test. And gatekeepers typically admit anyone willing to buy tickets.

The problem: Widget Channel is literally that—a new marketing channel that brands and agencies must manage. To reach target audiences, agencies must not only create specialized content, they have to buy media, track it, and adjust. The promise: According to Widget Channel’s team, developers will write their TV applications in popular Javascript, XML, Flash, and HTML languages. In theory, this eliminates the need to create specialized content. Videos that play in web page margins can play also in TV screen sidebars.

The problem: Many companies have tried to bring internet functionality to television, but none achieved widespread acceptance. Perhaps TV viewers just want to watch television. The promise: Widget Channel involves big time players—Intel, Yahoo, Comcast, ABC/Disney, CBS, Blockbuster, and so on. That means enough money to ensure a fair trial. The trial will center on a new internet-connected TV model that Yahoo calls “the Cinematic Internet.” While that sounds like a new name for old goods, the involvement of companies like Twitter could change the concept’s appeal. The one common factor that unites all TV viewers is that everybody talks about television. If Twitter created a widget to enable real time conversations nationwide, that’s the sort of thing “regular viewers” might truly enjoy. Advertisers, meanwhile, could dedicate Twitterers to respond to any chatter their commercials might trigger—not to shill, but to correct misinformation and hopefully answer direct questions.

This is just one small example of thinking ahead, so we’re ready for the opportunities soon to channel our way. And we need to start scheming today. If we don’t—and Widget Channel too fails to gain major traction—we risk losing even more years before interactive TV starts to work. At which point we can look forward to another round of excited announcements, followed by quiet interludes, and finally a series of brief disappointed obituaries.

2) Money talks. When Microsoft paid an estimated 200-300 million to acquire Navic Networks and its interactive ad platform, it underscored that even moguls believe that interactive TV ads are a pot of gold at the end of the test signal;

3) Advertising formats are media topics, and you can always count on the mainstream media to fill column inches about itself.

4) Interactive television advertising actually is the future of advertising. Engage-ability, target-ability, controllability and accountability are no itty promises. Interactive TV ads can deliver on them all.

Engagement. The Pepsi spots that DISH Network recently aired during MTV’s Video Music Awards allowed viewers to answer questions and cast votes with their satellite remotes. Younger viewers of The N’s Queen Bees series enjoyed similar opportunities that Cadbury sponsored. You want viewers to stick around for your ads? Give them something interesting to do while they watch.

Targeting. The MTV generation guzzles soft drinks. The N generation consumes candy. Directing interactive commercials to such broad demographics is merely the opening salvo. As TV providers learn to make better use of granular viewer data that set-top boxes collect, targeting will become more precise as it becomes more behavioral.

Control. Most advertisers grudgingly accept that consumers have wrestled away control of marketing message consumption. Interactive TV ads enable the desired dialog: advertisers present options, then viewers choose whether to act. No one can complain of offero interruptus if they purposely click overlays to watch expanded ads.

Accountability. In direct response television, the best way to measure ad performance is to tally phone calls, mouse clicks and the sales that they generate. We can now add “remote clicks” to the list. When interactive TV ads take the biggest step forward and implement “click to buy” functionality, the return on investment will be utterly transparent.

Cable companies are so committed to an interactive future that six of them joined forces this year to form the oddly named Project Canoe. You’d think that people with ties to an ad world that dreams up market segment acronyms like DINKWADs (Double Income, No Kids, With A Dog), could have come up with something more catchy. Still, at the risk of stretching extended metaphor beyond tolerance, the “Canoe” in this project is evocative. To the good:

• You can launch crafts in the water quite quickly. Accordingly, many initiatives have already tested. Several show promise, such as Backchannel’s system to aggregate web content based upon TV overlay clicks, Singlepoint’s platform to leverage mobile popularity by squeezing interactive ads into mobile TV deployments, and TiVo’s “Product Purchase” partnership with Amazon in which a TV remote can trigger an Amazon shopping interface.

• A canoe is a nimble vehicle. It allows precise-enough targeting to squeeze into hard-to-reach destinations. The segments most likely to purchase your products don’t congregate in single locales. As DRTV media buyers recognize, your best customers can emerge in small clusters from unusual places.

• If all in the canoe row in unison, they achieve far greater distances in a fraction of the time they could get there themselves. Project Canoe’s greatest promise is its strength in numbers. Joining forces to conquer technological challenges should ensure that the long-sought quartet of aforementioned opportunities should come to fruition in our lifetimes.

Lifetimes? Wow. That doesn’t sound fast. But what do you expect when you guide a canoe?

• Even the fastest canoe travels slowly. When Warner introduced the first truly interactive TV platform in 1977 in Columbus, the buzz about QUBE was enormous. The future of television—and advertising—had finally arrived! Except it’s thirty years later and we’re still foretelling TV and advertising’s future. In that context, Project Canoe’s upstream paddling—a mere half-year without game-changing breakthroughs—is hardly surprising.

• Canoes are small. No matter how nimble, they accommodate just a few people. BrightLine iTV Marketing Specialists contend that click rates for interactive TV ads range from three to six percent. But for now, that excellent percentage translates to just a handful of consumers—such as the “hundreds” who responded to a  Sparks’ ticket campaign.

• Paddling is exhausting. If the current isn’t favorable, no amount of effort will push you safely to your target destination. Although we see many interactive campaign announcements, we rarely read reports of results—which means that reach and response remain meager.

Cable consortiums and standalone satellite programmers are acting aggressively to make iTV dreams a reality—despite all the challenges. DVRs’ first appearance, for instance, unleashed a groundswell of uneasiness that ungrateful consumers would skip past commercials that bankrolled free content. Unquestionably, TiVo and its DVR brethren were the enemies.

Ironically, these very same devices will usher in the iTV era. Clicking TV screen overlays to buy Oprah’s latest club choice from Amazon, or to view extra content about Nike’s new shoe line, won’t cause viewers to miss a minute of their shows. DVRS allow them to finish surfing and shopping, then return right to where they left off.

Better still, most DVR owners subscribe to pay programming. Providers have an address on file. For those who pay automatically, chargeable account numbers are also stored. So it shouldn’t be long before overlay clicks lock in purchases and product deliveries.

Good old DVRs! We loved ’em from the start.