Video-on-Demand Ad Mart Is Pretty Pathetic

There's little evidence that a Web-like dynamic market has materialized

I don’t have diabetes. And while I’m getting up there, I’m not on Medicare. Not even close.

So why is Time Warner or BBC America so inclined to push Medicare diabetes health insurance on me?

Several years ago, probably in 2005 or 2006, I recall having an in-depth conversation with representatives from Atlas about how ads on TV would soon be delivered "dynamically" just like they are on the Web, with all the precision, data and targeting options common to online advertising. In particular, video on demand was the perfect outlet, these folks thought, for TV to tap into the power of ad serving. I had many similar conversations over the years with execs from Starcom, Microsoft and various startups.

In 2013, the VOD ad market is less than dynamic, despite the claims of some players. In fact, it’s pretty pathetic.

To explain: I recently had the occasion to do some serious late-night binge viewing (I have newborn twins). After reading and hearing tons about BBC America’s buzzy cult hit Orphan Black, we decided to give it a shot. It’s not on Netflix yet, so we started watching it on demand.

I couldn’t help notice that during each commercial break, the same two infomercials ran: one for the aforementioned Medicare offering—the Diabetes Care Club—and the other for some sort of bizarre car insurance product that was only for older models with a specific amount of mileage. The brand’s name is Listen Up America. After the fifth time during a single episode watching the same two ads (I'm not exaggerating here), my wife and I had to laugh, as we fast-forwarded as quickly as possible.

How is it possible, in an era of big data and programmatic buying magic, that this is as far as the TV industry has come? Perhaps a bigger related question: How is it possible that I was actually able to find a BBC America show in Time Warner’s programming guide? Help Google, Apple … anyone?

OK, I hear you. This is not a fair way to assess the entire VOD ad market. It’s just one show on a obscurish cable network in the New York market. So, to broaden the experiment, I also watched a few episodes of AMC’s The Killing on demand since I’d forgotten to DVR them (I've been kinda busy). The ads were slightly better. At least, they weren’t infomercials.

First, there was an ad for Geico, which isn’t so bad, except that I already have Geico insurance. Next, there was an ad for the travel site Hotwire. This one urged viewers to use the service to book a trip to places like—New York. Next was an ad for, wait for it, The Killing. The show that I was actually watching. Guys, you are killing me! (Sorry).

Dear cable people, I’m not saying you should have a unique ad for every single person watching TV. But a little data wouldn’t kill you. I just purchased like 60,000 diapers on Diapers.com. I’m going to get retargeted on the Web relentlessly. Can’t you guys even give this sort of thing a shot?

My guess is that the current VOD usage patterns aren’t all that great. And the money isn’t worth the TV guys' time just yet. So please, for now, stop telling me about the "right ad at the right time" dream. At least until Jeff Bezos buys Time Warner—or BBC America.