Are Digital
Video Recorders the Death of TV Advertising?
TiVo and other Digital Video Recorder are rapidly gaining in
popularity in the U.S., threatening the viability of TV
advertising. Two reliable sources of research - Jupiter
Research and Nielson Media Research - report that over half of
DVR owners skip commercials. These viewers, primarily from
the 18-49 year old demographic, are not watching your
commercials.
This trend has serious implications for auto dealers. The
2006 NADA study shows that the average dealership still spends
20% of their marketing budget on television advertising - or
about $115 per new car sold.
Given declining viewers of TV advertising driven by DVR
technology, should %Company% continue to spend money on TV
advertising?
And if so, how can you maximize the value of your TV advertising
dollars?
For now, the answer is television remains a viable form of
advertising with DVR penetration at about 17% in the U.S. But
that number will more nearly triple in the next three years as a
recent estimate by the Carmel Group projects 52.5 million DVR
units by 2010, or a 46% market penetration of U.S. homes.
By 2010 that could mean nearly 25% of the TV viewing public is
lost to advertising.
If the face of declining reachable audiences, auto retailers can
navigate the bumpy road ahead and continue to use TV advertising
profitable by following a few key methods:
1. Target
Live Programming:
Advertise on live events like sports, local news and the weather
channel. Consumers less likely to record live shows and
view them later, reducing the potential for fast forwarding
through the commercials.
2. Target
Late Night & Early Morning:
When people have the TV on getting ready for the day or going to
bed they are much less likely to be using DVRs to watch favorite
programs. Those time slots also mean viewers are watching
on the bedroom or kitchen TVs, where DVR devices are less likely
to be installed. Avoid Primetime TV which not only charges
the highest rates, but is most likely to be recorded on DVR and
therefore loses the most viewers to fast forwarding through
commercials.
3. Negotiate
Lower Rates:
Use the DVR statistics and loss of the commercial viewing
audience to negotiate lower rates. TV Spots ads are
projected to be down 5.5 % in 2007 and TV stations are worried
about losing more share to online advertising. Light a
fire under your media buyer, who gets a commission on total
dollars spent so they have little incentive to reduce your TV
spend unless you educate them on DVR penetration and the loss of
viewers.
4. Continuous
Graphics:
Put your offer and phone number on the screen for the duration
of the commercial. Even while viewers are fast-forwarding,
they are looking at the commercial to see when the programming
resumes. By putting your offer (such as "0% Financing") in
the same position at the top of the screen for the full 30
seconds your message will be seen and remembered even in fast
forwarding mode. Similarly, put your phone number and/or
domain name in the same position at the bottom of the screen for
the full 30 or 60 seconds so it will be seen.
5. Memorable
Contact Information:
Getting your contact information seen is the first step towards
generating a lead. Getting it remembered for a call to action is
equally critical. Because you have less time in front of
the viewer, your phone number and/or domain name must be easy to
remember. Try #Vanity# in your TV ads and potential
guests will remember your phone number.
Summary: Television remains the most powerful media for
stimulating demand and should remain a part of your advertising
mix for years to come. By keeping these suggestions in
mind and advertising smarter your store can continue to use TV
advertising to profitably attract car buyers. |
