DVR Research Institute Study: More Info Needed

May 27, 2009  •  Post A Comment

When it comes to TV advertising there is, according to advertising executives (advertisers and agencies) that participated in a recent survey from the DVR Research Institute, no greater threat to effectiveness than the advent of digital video recorders (DVRs). The trouble is, each side believes the other is on top of the changes and their potential impact. They aren’t.
The study, “Advertising in the DVR Age,” which will be published next week, reveals that advertising executives believe DVRs represent the greatest challenge for TV advertising in the next three years. A shocking 83% of advertising executives believe that DVRs will negatively impact the effectiveness of TV advertising during this time. Only 66% felt that the advent of newer entertainment formats (games, Internet, etc.), considered the second-greatest threat, would have such an impact. With the upfront negotiations coming up, this is a critical time to explore if – and how – advertisers are going to adjust their TV advertising to the new DVR reality.
The survey asked about 200 top U.S. advertising executives (advertisers and agencies) to respond to a series of questions addressing the impact – and potential impact – of DVRs on TV and ad watching. In addition to responses from the advertising executives, the study includes interviews with industry thought leaders, an evaluation of the revised strategies that advertising executives are contemplating, an analysis of best practices and an analysis of past and future industry trends.
Numerous reports exist on the current and expected penetration of DVRs, the amount of live (versus time-shifted) TV watching and the ad-skipping patterns in time-shifted mode. Companies like Nielsen and TiVo offer increasingly granular data on DVRs and their impact on viewing habits.
With this abundance of information on DVRs, advertising executives might be expected to feel confident they have the information needed to deal with expanding DVR penetration.
Yet, surprisingly, these research results indicate that neither the advertisers nor their ad agencies are confident they have the information they need to make adjustments in advertising strategy to address the impact of DVRs.
Nearly 75% of the respondents “somewhat” or “completely disagree” that they have all the relevant information about DVRs and their impact on TV advertising.
What may be surprising is that all the respondents manage aspects of TV advertising and about 90% of respondents are directly involved in media-planning or -buying decisions.
What is most interesting, though, is that while – overwhelmingly – neither advertisers nor agencies think they have the information they need, a majority of both groups believe the other group is better informed than they are!
About 77% of the advertisers “somewhat” or “strongly disagree” they have the relevant information about DVRs to make strategy adjustments. Yet, more than half of the advertisers “somewhat” or “totally” agree with the statement that their advertising agency is well informed about DVRs and the impact they have on TV advertising.
Ad agency responses mirror those of advertisers. More than 68% of the ad agencies do not believe that they have the information needed to adapt their advertising strategy to the new DVR reality. Yet, almost 60% of the ad agencies think their clients are well informed about DVRs and the impact they have on TV advertising.
With so much information on the impact of DVRs available, why is the advertising community not more confident it has the information needed? It may be that, although there is much information available, there is little to no data available to answer some key questions that arise from the increased DVR penetration.
These questions include:
Which advertising formats (informative vs. entertaining, bare bones vs. elaborate, etc.) are least likely to be skipped?
What are the best ways of addressing changes in viewing habits due to DVRs – reallocating TV advertising expenditures to focus on different programs, formats or creative emphasis? Reallocation to other media?
Which alternatives to the 30-second spot are most attractive: sponsorships, pop-up ads, product placements, etc.?
How are DVRs expected to influence CPMs?
Respondents’ perspectives on these issues suggest opportunities for “turning lemons into lemonades” through strategy modifications designed to leverage the impact of DVRs to maximize advertising impact.
The results also show that the sellers of TV advertising – the networks, cable channels, syndicators and local TV stations – have to take a more active role in educating TV buyers on the true impact of DVRs on advertising. Even if most advertisers haven’t changed their advertising strategy because of DVRs – yet – many advertisers are getting an increasingly negative perception of the effectiveness of TV advertising because of DVRs. While some of these beliefs may be well-founded, others are most certainly based on wrong facts and misinformation.
Tom Schultz is managing director of the DVR Research Institute. He can be reached at tom.schultz@DVRresearch.com

16 Comments

  1. Wonderful to read!

  2. Thanks for your visiting this http://www.watchau.com/Swiss-Replica-Rolex online store.

  3. Thanks for your visiting this http://www.watchau.com online store.

  4. Great post!

  5. Really good post! Congratulations! I have not seen it before, but as you describe it I can totally understand your idea.
    Believe me I do usually not comment on blogs, but your article is really great so I bookmarked it and I will visit it regularly.

  6. I love my DVR. No more commercials! :)

  7. Hi there, I like the blog! I have been reading your weblog for a couple of days now and i’m definitely enjoying it. I actually had a few questions in relation to your post though. Do you consider it could be achievable for me to get in touch with you further to discuss it? Possibly setup a chat on e-mail or an instant messanging program? In any other case, thank you anyhow and I’m going to continue to read and comment.

  8. I like your blog.

  9. Neat blog layout! Very easy on the eyes.. i like the colors you picked out

  10. I’ll gear this review to 2 types of people: current Zune owners who are considering an upgrade, and people trying to decide between a Zune and an iPod. (There are other players worth considering out there, like the Sony Walkman X, but I hope this gives you enough info to make an informed decision of the Zune vs players other than the iPod line as well.)

  11. Great wordpress blog here.. It’s hard to find quality writing like yours these days. I really appreciate people like you! take care and see you soon

  12. Insightful info:) I will take a bit of time to absorb the site!

  13. I love the way you write and also the theme on your blog. Did you code this yourself or was it done by a professional? I’m very very impressed.

  14. Thanks for the Post seo training in Pune

  15. Really nice and interesting post. Want to read more news like this!

  16. Such a nice and detailed study report with sufficient statistical information. Really liked it!!
    http://freesongspk.in/

Your Comment

Email (will not be published)