Category Archives: DVR

Soon, a DVR in every home. Advertisers groan.

Marketers have been growing nervous about digital video recorders, those boxes now in 1 out of 4 U.S. homes that allow consumers to easily skip over TV commercials. So they may have a heart attack after the Supreme Court cleared the way yesterday for Cablevision to offer virtual DVRs to its customers.

Sure, this looks like just another cable add-on — but as Josh Bernoff notes at Forrester, now Cablevision can launch DVR-type recording options on a system-wide basis vs. installing them gradually in individual homes. DVRs are great for consumers because you can pause regular TV programming during a bathroom break, record shows you don’t want to miss, watch things later, and yes, skip commercials. Bernoff predicts virtual DVRs with clever functionality will expand rapidly as Comcast, Cox, AT&T and others try to differentiate themselves from satellite providers DirecTV and Dish Networks with less-nimble on-demand services. We imagine, for instance, a cable company with unlimited storage could let you build a personal library of your favorite TV shows — a great switching cost to keep you from ditching Cablevision for satellite TV next year. Such services could even slash customer churn among the 7% of the U.S. population who moves each year to a new home, because you could now take your entire library with you remotely — as long as you stick with the same cable provider.

It’s not the end of the advertising world, certainly. Cable companies derive revenue from advertisers and won’t rush to kill their golden geese. Tim Hanlon, EVP of Viva Ki Venture, told the LA Times that advertisers could even use expansion of on-demand video to improve ad targeting.

Still, consumers gain a new remote. There is a huge market for content right now, when you want it, and remote DVRs when ubiquitous will give consumers great control over which messages they see or skip. Advertisers will have to rapidly build more relevant or integrated content if they want to avoid the fast forward button.

Image: Still from video Speed by Atzu.

TiVo makes search simpler on TV

Why is it so hard to find stuff on TV? Parents still struggle to find that show on dinosaur bones while clicking over R-rated material on HBO with the kids watching in the family room.

TiVo announced at CES last week that it is improving television search functionality to mimic that on Google — now consumers can type in the first word of a show they wish to see, and all the corresponding options pop up. This simple move may accelerate consumer drift away from primetime programming, which peaked way back in 1983 when 105 million people watched the last episode of M.A.S.H.

TiVo and similar DVR devices are making advertisers nervous, because they allow consumers to record shows and fast-forward over commercials. This risk is compounded by the so-called convergence of internet with television, in which consumers could surf any video online and avoid all advertising from traditional broadcasters. “Convergence” has stalled for years, due to the conflicting standards and hassle of hooking up various boxes to your television, but it’s coming closer. Wired notes this month that “Sony, LG, Toshiba, Panasonic and Samsung all unveiled Net-connected TVs and enhancements enabling … the ability to access online videos seamlessly from Youtube, Netflix and Amazon, without requiring a peripheral device.” TV will never go away — humans like large-scale theater — but the ads on it soon may be avoided altogether.

$100k homes use more DVRs. Don’t touch that remote!

Speaking of video shifts, Mediaweek reports that more than half of U.S. homes taking in $100,000+ in income subscribe to time-shifting DVR devices: those black boxes that allow you to record a TV show, play it back later, and potentially skip over the commercials. The Mediaweek headline is a little misleading — it is not true that “more than half of $100k homes time shift” since we suspect many consumers have a hard time with the damn remote controls. But the trend among the most affluent consumers is definitely worth watching.

The irony of ads pushing video online

More than 1 in 4 U.S. households now have a DVR device allowing consumers to skip over ads, and marketers are scared silly. Ad Age just reported that NBC and CBS may not exist in their current form in a few years. The darkest worry for advertisers and content publishers is that broadcast dollars may turn into online pennies, if consumers ignore interruptions online and drive down the value of ad inventory.

So it’s ironic that we find this online FilmFellas discussion by Steve Weiss of Zacuto, a filmmaking product shop, explaining that advertising is one of three powerful forces pushing video online.

Force 1: Good tools. Online video took off in 2005 with YouTube but the initial quality was fuzzy. Recent improvements in high-definition cameras, falling costs, and sites such as Vimeo that stream video in HD are changing the game.

Force 2: Your ego. Any design shop or marketer or artist who ever filmed anything is familiar with the soul-crushing pain of having a committee screw with your vision. With online video, creators can control their own output, and that’s a powerful draw.

Force 3: Advertising dollars. Weiss points out that advertisers will gradually shift funding away from traditional broadcast — where consumers can skip over ads and call up television only at the times they want — to online video, where ads can be inserted with more control and (theoretically) 1to1 personalization.

Ah, but don’t listen to us. Watch these guys chat about it over wine.

London and trend lines

David Hubert visited London and forgot his video camera, so instead took more than 3,000 still photographs and knit them together into this montage. The effect is to recast our vision — people in the Tube, cars on the streets — a bit differently, as if time had both stopped and sped up concurrently. It all reminds us of business trend lines and how few stop to watch them.

You know: The things in retrospect we should have seen coming. The mortgage meltdown killing real estate investment. The rise of video games (up 36% in first half of 2008) threatening the film industry. DVRs (now in 28% of U.S. homes) putting the pause on ads that fund commercial television. Diminishing results in newsprint (heck, even the Wall Street Journal bragged about it).

So many marketers get hooked on what worked yesterday and measure this quarter’s results against a standing-still-in-time yardstick … unaware that bigger changes are afoot. What’s your plan for watching the tide?

TiVo pushes YouTube; advertisers tremble

TV advertisers, worried that audiences are avoiding them by skipping ads or moving online, may now have a heart attack. TiVo has announced it will begin streaming YouTube videos to its settop digital video recorders, giving consumers a new way to be entertained without watching ads.

About 1 in 4 U.S. homes now have TiVo-type devices that allow them to record shows and fast-forward through commercials. YouTube attracts 68 million viewers a month, who in May watched 3.8 billion videos. You do the math.

Photo: Esther G.

4 marketing lessons from death on stage

Live theater is dying. The sweet blue-haired ladies who once filled theater seats are moving on to the big stage in the sky, and as younger generations fill basements with big-screen TVs, the arts community is reeling. Pay attention, because shifts in demos and consumption are rocking industries from automotive to zoo attendance, and you too will need to respond.

Eric Smith, marketing director at Westport Country Playhouse, has launched a new blog that pinpoints the challenges of the entertainment industry as audiences shift and change.

“For many theatres the answer seems to fall on ‘we need to bring in younger audiences’, writes Eric. “… but here is the thing: younger audiences are merely a demographic that we have identified who are currently not attending theatre in large numbers. It would be like saying, ‘there are a billion people in China who don’t come to our theatre, how do we get them here?’ “

Eric suggests a deeper look at the marketing process is required, beyond just shifting the demo target. To build upon his post,

1. Reframe the goal.
First, your business target has to reflect the new reality. Has the recession or oil prices changed your customers’ behavior? Does your basic business goal reflect what new level of success is required? How would GM do next year if it maintained a goal to sell X number of trucks as the metric of success?

Theater marketers can do this by refocusing from subscription sales, the past ideal goal, to “multi-ticket buyers” — a nod that consumer behavior has changed, and that people now need more flexibility.

2. Map common pathways to sales.
This means analysis: reviewing customer account histories, looking for patterns among the best customers, and then defining the touchpoints and needs that can increase such behavior among future prospects.

3. Target diversity, not demos. It’s not enough to shift advertising to working female professionals age 35-44. Advertising media plans can target multiple audiences, say, professionals who commute, stay-at-home moms, long-time loyalists, and new movers into the market.

4. Test, refine, redeploy. Advertising plans almost always have unexpected results. Tracking performance by media channel is critical (say, the cost per inquiry from Newspaper A vs. Insert B). As lower-cost lead generators emerge, shifting funds can yield 30% to 40% more customers from the same advertising budget.

Footnote: Eric is a client of Mediassociates. We usually avoid promoting our clients on this news blog, but the thought process he presents is worth watching.

6 million TV viewers disappear. Blame the DVR.

Call it Must Not See TV.

The New York Times reports 6 million TV viewers have disappeared in the past year — not abducted by aliens, but simply no longer watching prime time television. This is incredible, representing 13.6% of the 44 million folks who watched prime time TV just one year ago.

The impact on the ad industry will not be pretty. While Nielsen notes that ratings for some shows have gone up — about half the people who watch “The Office” in the Los Angeles market do so with time-shifting on DVR devices, and such habits have actually added eyeballs to a few popular shows — these same viewers are likely skipping commercials. It doesn’t take long to figure out the fast-forward button on a TiVo.

The good news is that viewers are shifting video-viewing habits online. If you are not now testing emerging formats for online video advertising, rethink it. Your target consumers may be there in 2009.

(Photo: Angel R Ravelor)

Slip sliding away — in a hot Audi

Audi fans, follow this bouncing ball. Magna Global releases a study showing TV commercial ratings are dropping off a cliff in homes with DVRs. It gets bad. Real bad. Apparently commercial ratings are 39 percent lower than program ratings in houses with those black boxes that record and play back TV. And when only playback periods are measured, commercial ratings fall to 64 percent lower.

This means (a) people are skipping TV commercials, (b) advertisers need HeadOn! topical headache medicine, and (c) Audi is fighting back! Audi released two kindacool commercials that are sped up, with the idea you have to slow them down with your DVR remote to fully enjoy them.

And then the story gets strange. Perhaps worried most consumers can barely find the remote, Audi released the clip above on YouTube to explain how to slow down commercials with your DVR remote.

OK, we know 1 in 5 homes has a DVR and this commercial-skipping thing is going to get worse. But sending your customers to the web to YouTube to find your instruction video to get instructions to record your commercial on a DVR and then use the remote at a later date to stop, rewind, and slow down the commercial is giving me a headache. Methinks an ad agency somewhere thinks too much. HeadOn! HeadOn!