Monday, December 31, 2007

Palisades finds DVR usage has small impact on advertisers

According to this article in AdWeek, DVR usage is not yet having a significant impact on viewing commercials or time- and season-specific messages. According to the article:
"The study by the Santa Monica, Calif.-based media agency determined that more than half of prime-time programs recorded were played back within the same day of recording. By the end of the next day of airing, nearly three-quarters of all programs have been viewed.

"According to the study, time-shifting habits increase viewing more than 16 percent.

"The study was conducted from Sept. 24-Oct. 21 by NPower, which like Adweek is a unit of the Nielsen Co. The survey polled more than 8,000 television viewers.

"Fewer than half of the people watching a DVR recording said they fast-forward through ads, meaning that DVR use does not significantly impact ratings. 'Nielsen estimates DVR penetration to be at 20 percent, up 12 percent in January of this year,' said Susie Thomas, svp, director of research and insights. 'While this is a
good-size increase, the impact on viewership remains minor.'

"Thomas said that there are program-to-program fluctuations, but 'overall DVR usage is not dramatically cutting into live viewing.' She added that among the top 10 programs most likely to be recorded, CBS's Survivor: China measures as high as 58 percent watched on the same day of airing, compared to 27 percent for CW's Reaper)."
On top of that, of course, is the fact that only 20% of US households even have a DVR after over a decade of said devices being on the market. Granted, that's an insane growth and penetration rate for any other product on the market, but in our case it means that 80% of the US populace is still watching TV commercials the old-fashioned way, whatever that is (for me, it's a time to flip to other channels, get a snack from the kitchen, or turn off the TV because I've woken from my stupor and realized I've lost interest anyway).

DVR usage has been one of those things that has really scared advertisers in the past few years, and I and others have written about it being a growth catalyst for the out of home market (and particularly the digital signage market). In fact, way back in 2004 I took a look at the potential impact of TiVo on the digital signage market, and while it was purely speculative, I think it's safe to say that while TiVo has caused some sleepless nights on Madison Avenue, it hasn't caused a big shift in advertiser spending habits. And if this news is true, it probably won't in the near future either.

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