On Oct. 1, Rogers Cable launched – for the very first time in Canada – Enhanced Television. What are its benefits? Will it add value to the television viewing experience?

Let me start by explaining it from a viewer’s perspective. Enhanced Television appears on a TV screen in the form of an icon. Someone watching an ‘enhanced’ show or spot can use the remote control to click on the icon. That click offers options – options such as getting more news, more sports or detailed weather information. Options such as receiving product information, entering a contest or even making a purchase.

Content that Web surfers have been accessing over the Internet in a non-linear fashion for years will now be available on the TV via the digital set-top box and all viewers need to get at it is their standard digital remote.

The advantages for broadcasters are clear – it’s an opportunity to have a closer relationship with the viewer.

But Enhanced Television also opens up new opportunities for advertisers. Molson, L’Oréal and Imperial Oil have already indicated they will develop Enhanced Television ads. And Rogers has put its money where its mouth is, by running ads on Enhanced Television for its own products, such as the Rogers@Home service, as of Oct. 12.

These ads make use of Enhanced TV’s interactivity by asking viewers questions such as whether they already subscribe to certain serivces, then proceeding to tailor the offers and information appropriately.

Enhanced Television offers advertisers the chance to bring the viewer one step closer to a purchase – and perhaps even make that purchase through the TV. This combines the mass marketing power of television with the one-to-one transactional power of the Internet, creating a highly effective new medium. Enhanced advertising can also be used to find qualified leads, distribute coupons and other incentives, as well as encourage contest participation.

The customer acquisition capability of this service has prompted both automotive and financial institutions in the U.S. to adopt this new technology to find new customers, while U.S. packaged goods firms are already using Enhanced TV to distribute product samples to qualified homes.

Enhanced TV can be used for direct response campaigns, traditional commercials, long-form infomercials, in-show product placement, in-show sponsorships and even ‘virtual channels,’ non-broadcast channels which are only available to those who subscribe to Enhanced TV. The advertiser can experiment with the technology and judge the performance of these activities based on yield. Enhanced TV brings a wonderful quantifiable sense of accountability with it.

Enhanced TV advertising also has a number of intangible benefits. According to Alameda, Calif.-based interactive TV pioneer Wink Communications, ads that contain enhanced content have been shown to have increased recall and benefit from an overall ‘leading edge’ halo effect.

Invaluable research and key learnings are another useful byproduct. As a media analysis tool, Enhanced TV allows advertisers to gain insight into what part of their campaigns hit the mark, and case studies have shown some of this learning can be counter-intuitive.

For example, earlier this spring, Ford ran an enhanced ‘Geyser’ ad for its Explorer in the U.S., where Enhanced TV technology has been used for the last three years, with dramatic increase in viewer usage over the first quarter of 2001.

Over 4% of all U.S. homes that subscribe to Enhanced TV – that’s about four million homes – viewed the offer. In other words, viewers took the time to click on the icon and check it out. Of those, 64% proceeded to request a brochure. That’s an incredible take-up rate, but here’s what Ford learned: viewers of predominantly family-oriented networks requested the brochure twice as often as those networks with predominantly male and business traveller viewers. Along the way, Ford also validated the fact that prime time works best for them.

Here’s another example: Pfizer recently enhanced a television spot that marketed medication to help people sleep. Quite naturally, the company’s execs felt that the best day part for them would be late evenings and early mornings. That’s when people who had trouble sleeping would be watching television.

Not so. They found response was best during the day, showing them that people who had trouble sleeping wanted help before to going to bed – not when they were already suffering from insomnia.

Enhanced Television is not a new way to advertise. It is a complement to brand advertising. It supports existing campaigns by allowing advertisers to imbed a call to action and direct response methodologies into an existing TV campaign.

And being leading edge has its advantages. Advertisers who start early will gain tremendous market research and experience. Those advertisers will form relationships with consumers that competitors have not yet forged. And as we all know, once there is a strong bond, it’s hard to take that customer away.

Michael Lee (mleebsch@rci.rogers.com) is VP, new product development at Toronto-based Rogers Cable, Canada’s largest cable company.