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DVRs and Online TV - Is It Changing the Way People Watch TV?
By Peter Koeppel
Today, one in five households in the U.S. owns a DVR, up from one in thirteen households two years ago, reports a new study from Leichtman Research Group released October 12, 2007. Additionally, NBC Universal's Digital Insights and Innovations Team (NBCU) reports that in May 2007, ten million unique visitors went to NBC.com and watched an NBC television program online, resulting in thirty-five million individual streams of NBC TV show segments.
With findings like these, you would think that traditional TV viewing is spiraling downhill and destined for the same fate as eight-track tapes and VCRs. Not so, says the Nielsen Company. In fact, television tuning during the 2006-2007 television year remained at record levels set the previous year.
According to figures released by Nielsen on October 17, 2007, the total average time a household had a television set tuned during 2006-2007 television year was eight hours and fourteen minutes per day, the same amount of time as the previous year. And the average amount of television watched by individual users per day during the 2006-2007 television year was four hours and thirty-four minutes, a decline by a mere minute from the 2005-2006 season.
The results of these findings are somewhat surprising. With the rapid penetration of DVRs and the availability of online TV shows, I would have expected to see greater erosion in live TV viewing. But as the Leichtman study points out, ninety-five percent of all TV viewing in the U.S. is still of live TV.
However, the growth in online viewing of TV and of DVR usage is significant, and it points out the value of offering the consumer a choice in how they view programming. So even though people are watching more TV than ever before, consumers have more control over how and when they view programs. Therefore, smart networks and advertisers will give viewers multiple choices for watching their favorite programs and for trying new ones.
Is the DVR the Demise of TV Advertising?
The Leichtman study predicts that the number of U.S. households with DVRs will grow to over sixty million by the end of 2011. Does that mean that advertisers will have a harder time reaching people who can fast-forward through the commercials? Not necessarily.
The study also points out that while eighty-four percent of DVR owners rate the ability to skip commercials as very important, only eight percent of DVR owners say it is the greatest benefit of having a DVR. Additionally, forty-five percent of DVR owners record five or fewer programs per week, again pointing to the preference for live TV.
Online Viewing Shifts TV Viewing
Of the people who went to NBC.com to watch an episode of their favorite show online, forty-eight percent of users viewed a stream of at least one segment of "Heroes," the site's top show. Interestingly, NBCU's research showed that thirty-five percent of the users went online to sample "Heroes" for the first time, and that ninety-six percent of them continued watching the series, both online and over traditional TV. So in this case, online viewing of shows is actually prompting more live TV viewing. NBCU is utilizing this data to pitch clients on a "360 degree" package that allows advertisers to reach and further engage viewers both through conventional TV and online.
One other interesting pattern revealed by the NBCU team was a slight increase in online viewing of NBC Rewind shows during lunchtime on workdays, suggesting that online might be producing a new form of primetime. However, the study also shows that the heaviest usage of the site continues to be at nighttime, during conventional TV primetime hours.
The End of an Era, or the Dawn of a New Day?
So are DVRs and online shows changing the way people watch regular TV? Yes, but not in the way most would think. As all the research reveals, even though there are numerous screens and devices competing for people's time and attention, the majority of viewers still tune into traditional television. Some discover a new show online and become regular viewers of the program live, while others use the new technology at a frequency rate that barely impacts TV viewing habits. The key, then, is to give consumers choices. Consumers already have the power; let them use it wisely.
Peter Koeppel is Founder and President of Koeppel Direct, a leader in DRTV direct response television, online, print and radio media buying, marketing and campaign management. With a Wharton MBA and over 25 years of marketing and advertising experience, Peter has helped Fortune 500 companies, small businesses and entrepreneurs develop direct marketing campaigns to increase profits.
Peter started Koeppel Direct in 1995 and has built it into one of the leading infomercial direct response media buying firms in the U.S.
For more information please visit: koeppeldirect.com
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