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Marketers: TV Advertising Effectiveness Has Decreased

Study: When DVR Penetration Reaches 50%, Marketers Will Cut TV Ad Spending 2/20/2008 01:24:00 AM Eastern

A majority of marketers said TV advertising has decreased in effectiveness over the past couple of years, according to a study by the Association of National Advertisers and Forrester Research, but the ANA also suggested that the TV medium is adapting to meet the challenge of grabbing those increasingly wandering eyes.

The study, to be released Feb. 28 at the ANA's 2008 TV & Everything Video Forum in New York, found that 62% of marketers held that opinion, but that almost one-half were experimenting with new types of TV advertising that would boost that effectiveness by working with the digital-video recorders and video-on-demand services that have given viewers more control over ads. Those include ads in online streams of TV shows, ads embedded in VOD programming, interactive-TV ads and ads placed in set-top-box menus.

One potentially ominous sign was that a majority of marketers said that when DVR penetration tops 50% -- Nielsen estimated the current universe at 23% -- they will cut their TV ad spending by 12%.

The migration of some of that ad spending to the Web continues, with 87% of the respondents saying that they would spend more on Web advertising this year than last year.

“We respectfully disagree that television advertising has become less effective," said Television Bureau of Advertising President Chris Rohrs. "More people than ever are watching, and they are watching on bigger and better sets, often in high definition.  A good TV spot today has the best chance it’s ever had to connect and persuade.”

But ANA president Bob Liodice was not dissing the TV medium, instead suggesting it was adapting to the challenge.

“As marketers embrace the richness of new advertising avenues outside of the traditional TV format, the TV industry is working to address marketers’ issues related to ratings and the changing TV landscape,” he said in announcing the results. “Marketers, in collaboration with the TV industry, will continue to find the most effective and innovative ways to reach their customers through the TV medium, utilizing the emerging technologies available to them.”

On the ratings side, 72% of marketers said they are “very interested” in getting ratings on individual commercials rather than an average commercial rating. The ANA has been pushing for that individual rating so that marketers can better track the effectiveness of individual spots.

The study was conducted in January and polled 79 advertisers in a range of industries and ad categories.

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