According to an Association of National Advertisers survey last month, 78% of advertisers said they have less confidence today in the effectiveness of TV advertising primarily due to the increased adoption of DVRs. The TV broadcast study, performed by Millward Brown, found DVR ownership does not significantly decrease ad recognition.
Same ad recall and recognition
Researchers conducted a survey of 2,000 DVR owners and non-DVR owners, asking questions about commercials that aired during prime time on Tuesday and Thursday nights in March. The commercials were for well-known brands in four categories: cars, cellphones, fast-food restaurants and movies. For all product segments, DVR owners and non-DVR owners exhibited the same level of ad recall and ad recognition.
"The results are very positive for advertisers. It shows that TV advertising remains as effective as it has been the last two years," said Michelle de Montigny, senior VP, Millward Brown Media Practice.
Most viewing still done live
The survey suggests that the viewing habits of DVR-owners may not be as radically different from non-owners as has been feared. Not all DVR-owners surveyed always recorded programs to watch later -- 61% of their prime-time viewing was done live.
Where viewing habits of DVR owners and non-owners do diverge, the survey suggests the differences might not necessarily be detrimental to advertisers. While analysis of the survey data is not complete, Ms. De Montigny shared some trends she sees developing.
"The people who are watching on DVRs, some of our questions indicate that they are more engaged with the medium and we also find that if they are fast forwarding, they keep their eyes on the screen," she said. "Also, the people who are not DVR owners seem more likely to leave the room during commercials."
Clearing up misconceptions
Alan Wurtzel, president-research and media development at NBC Universal, indicated the network helped fund the study in order to clear up misconceptions about the actual consequences to advertisers of DVR usage by viewers. "We're very concerned there's been a huge misunderstanding, there is an inaccurate perception of what DVRs do. We wanted to get one more piece of research to get a realistic picture of what is going on," he said.
Jon Nesvig, president-ad sales at Fox, explained the network was involved in the study for the same reasons. "TV has been universally accepted as the most powerful medium, it behooves us to fund reality-based research studies in an era of DVRs and VOD."
The networks indicate that advertisers should pay equal attention to an ad's effectiveness as they do to its reach. "People are missing the question here. It shouldn't be about ratings. The end game is ad effectiveness. The question needs to be, Is the effectiveness of the ad objective compromised by DVRs? There is no evidence that the ad effectiveness has been diminished," Mr. Wurtzel said.
Mr. Nesvig expressed a similar sentiment. "What is true effectiveness? Advertising ultimately should positively impact brand awareness and [our study found] it's basically the same in non-DVR households as in DVR households. You can't say the sky is falling in and it's because of DVRs."
"If this is true, I'm comforted," said Gary Carr, senior VP-director of broadcast services at Targetcast. "I am comforted to a degree that there is no difference in recall. When the industry spends 40 billion annually on national television, you kind of like to know that people are watching."