Are Television Commercials Losing Their Value?
October 30, 2013
I’m sure you remember a time in your life when you could recite every commercial that came on TV. You remember ads you loved, ads you hated, and how those breaks between your show seemed to take forever to get through.
Nowadays, you probably don’t feel quite as familiar with every commercial. With so many viewing platforms (mobile, shows on DVD, streaming), Digital Video Recording (DVR), and distracting gadgets at your fingertips, you’re tuning out more than tuning into TV ads.
In the past week, can you thank live broadcast and cable for all of your program viewing, or do you owe some credit to:
- A computer?
- A phone or tablet?
All of these added platforms have flipped the television entertainment industry over the last several years. Many platforms allow viewers to see commercials in a limited or disengaged format, or pay to avoid them entirely.
Free Hulu accounts will still show commercials, but paying users will only see a limited number of commercials; Netflix streamers don’t see any ads when watching their shows and movies. Watching shows on free streaming mobile apps like WatchESPN or the CBS app feature ads, but viewers can easily switch to another app or put down the device to ignore these commercials.
DVR presents another challenge for TV commercial advertising.
Due to video recording in 2012,
- live TV viewing decreased by 2%
- DVR viewing increased 8% (Broadcast Engineering).
With less live watching and more DVR watching, people are far less likely to watch commercials since they have the option to fast forward through them and get back to the show quicker.
The good news on the DVR front however, is that a fast-forwarded ad is not always a wasted ad. A Boston College study contests that brands can still make an impact with a commercial that is being fast-forwarded through. The study argues, “Fast-forwarded advertisements containing brand information at screen center still create brand memory even with a 95% reduction in frames and complete loss of audio, whereas advertisements with brand information located elsewhere are of virtually no value.”
The abundant presence of smartphones and tablets on household couches creates an alternative to watching commercials too. Since 56% of American adults own a smartphone and 35% own a tablet computer (Pew Research), it’s easy for viewers to check an email or open an app to dismiss a commercial break.
As we’ve all noticed recently, television programs love to show off all the people who are tweeting about them during the live showing. Many social viewers are taking to their devices during commercial breaks to update their statuses, or share their thoughts about the program they’re watching. So much so, that Nielsen has added Twitter metrics to its TV ratings. The odds are pretty slim that people are paying attention to TV ads when they are reading through News Feeds and sending Tweets. Now more than ever, viewers can easily choose to ignore commercials.
As TV ad spending continues to increase, audience growth remains stagnant (Marketing Charts). So why are companies continuing to shell out big bucks on prime time commercials?
- Broadcast media still has the highest reach of all advertising platforms.
- If their competitors run commercials, they should be too.
However, increased diversity in web and mobile advertising have increased their reach. While print advertising continues to decrease, internet advertising’s reach inches closer to television’s.
Commercials still have considerable value, although it may not be the value it used to be. Many sources argue that TV ads don’t have nearly the reach they did a decade ago. It is encouraging to know that DVR hasn’t completely ruined a commercial’s impact; and that in fast-forward, a commercial can still influence an audience. Super Bowl commercials will always be strong , and any commercial can be fun and effective. But with so many promotional options out there now, businesses can look other directions to find great ways to advertise without eating up as much of their budget.
Check out our blog about mobile app advertising and consider some other options. Some of the best ways to promote your business with today’s technology include optimizing your website for mobile devices, maintaining a good social media presence, and making sure your business can be found on search sites and services. Fill out the contact form on the left if you’d like to know more about the ways we can use these techniques to promote your business.