While TiVo is well known for allowing television watchers to skip advertising, they are hoping they can entice viewers to watch branded advertising that provide entertainment value or user interest within the commercials. The program, called Product Watch, allows viewers to actually search for ads in various categories and there are already has 70 advertisers signed up.
The ads range from cooking advice and how-tos from Kraft to Suze Orman talking about loans by Lending Tree. Some of the ads are quite heavy on the advertising, such as GM spotlighting their vehicles. Ford, on the other hand, has taken the low key approach with Penn & Teller doing one minute tricks on a golf course with a vehicle in the background. The ads are much longer than traditional 30 second spots, instead they range from one minute in length to one hour.
This model is based on pay-per-view, only instead of the end viewer paying to view, the advertiser is paying for each video download. The Wall Street Journal says this approach is attractive for smaller advertisers who may not be able to afford to target an entire audience of a network or show, yet are able to show their ad to those who are specifically chosing to watch it, meaning they are able to target that ad very well to the audience they want.
ClickZ also reports that the next phase of Product Watch will allow viewers to request more information directly from advertisers on a cost-per-lead basis.
Robin Good has detailed screenshots showing the Product Watch interface and implementation on TiVo.