Why advertisers shouldn't bank on live TV for maximum engagement
When NBC’s live broadcast of The Sound of Music aired in December, 18.6 million people tuned in to watch in real time, giving the network its biggest Thursday night in four years. The Live+3 numbers—the Nielson rating service that tracks TV consumption data up to three days after the original air date—topped 21 million viewers. In more affluent homes with $100,000-plus incomes, The Sound of Music achieved a 6.8 rating in adults ages 18 to 49. (The other big broadcast of the year for that demographic was another live show, the Oscars, 10 months earlier.) Unsurprisingly, NBC confirmed days later that they had already begun work on the next musical they will broadcast live in December 2014.
Television networks have decided that live events are the way to save traditional TV as an advertising medium. It’s smart of them to start to worry about the long-term viability of TV advertising, although reports of its demise are definitely premature. Not only does the vast majority of ad spending still go to TV, but TV ad revenue is projected to increase by 5% annually between now and 2017. Globally, TV is still the largest advertising medium, with the Internet a close second, according to ZenithOptimedia, as reported recently in Ad Age. Online ad spending has increased while print media has suffered the most. Radio is also seeing steep declines, but traditional TV has seen no such depreciation. And of the 60 hours per week that the average consumer spends engaging with electronic media, more than 35 of these hours—nearly 60%—is spent with good old-fashioned TV.
So why worry? While Americans are still watching lots of TV, more and more of them are watching recorded programming with the DVR remote in-hand. Ever since TiVo was first introduced in 1999, advertisers have worried about this technology’s impact on commercial viewing. During the early years, our research found that, surprisingly, levels of commercial engagement were not severely affected. In the years between 2001 and 2009, Communicus research found no evidence across the thousands of commercials we measured that average commercial engagement was declining. Further, there was little proof to support the assumption that DVR users were less aware of specific commercials than were non-DVR users.
This all began to change in 2011. Our research shows that this was clearly a tipping point. DVR adoption passed the 40% household level and sufficient numbers of TV watchers actually changed their viewing behavior by watching an increasing proportion of their TV on a delayed basis and actively skipping commercials as they did so.
Between 2011 and 2013, we found that engagement with the typical TV commercial weakened by an astounding 21%—from an average of 40% in 2011 to 31.5% in 2013. This drop occurred after a timeframe of at least 10 years during which average commercial engagement showed no significant downward trend whatsoever.
This problem has not gone unnoticed by the major TV networks, as evidenced by NBC’s announced move to incorporate more live events in their future programming. Not only does NBC hope to minimize delayed viewing and skipped commercials, but they are also suggesting that the commercial audience for these live events is higher quality from an engagement standpoint. In other words, NBC is betting that people will be more glued to their set for the live programming and also for the commercials that run on that live program.
Perhaps NBC is imagining that every live event is like the Super Bowl, with the audience eagerly and excitedly watching the commercial breaks as Monday morning water cooler fodder. This highly engaged commercial viewer scenario actually works pretty well for the Super Bowl. Communicus has measured commercial engagement for nearly all Super Bowl commercials aired in 2012 and 2013, and the research proves that engagement with commercials aired during the big game is more than 80% higher than for ads aired with a more typical mix of TV programming at a comparable level of exposure opportunities.
However, there are no other live events in which commercials are so hyped in pre-event publicity as the Super Bowl. There is scant evidence that any other live event beyond the Super Bowl represents an environment in which viewers are more likely to engage with commercials simply because the event is live. They’re just less able to skip through the commercials electronically.
The other aspect of the live event programming strategy being adopted by the networks is an attempt to get consumers involved with social media surrounding the event. This is clearly a sound strategy for boosting the size of the audience for the show. As Craig Zadan, the co-executive producer of NBC’s The Sound of Music, told The New York Times: “Social media played a pivotal role in the success of the show.” He also cited the Twitter and Facebook buzz around the broadcast “that lasted the entire performance and beyond.” As viewers talk on social media about the show, it motivates their friends to tune in. Then, everyone converses together, solidifying the social bonds and engagement with the program content.
However, while encouraging social media buzz during live TV events is great for networks (research has shown that increased tweet volume drives live TV viewing), it’s not so great for advertisers. If viewers want to watch the show and talk about it, when’s the best time to talk? During the commercial breaks. Our research confirms that those who are active on a second screen while watching TV are less likely to notice and engage with the commercials to which they’re exposed during the show than are those who aren’t on a second screen while watching.
As if the problems with second screen involvement cutting into commercial engagement weren’t enough, we appear to be moving into a world in which third, fourth and even fifth screen competition is emerging. Besides the TV, advertisers are also competing with tablets, PCs, smartphones, laptops, and wearable technology such as Pebble Smartwatches and augmented reality devices like Google Glass. Brands see these screens as potential messaging platforms, increasing repetition and amplification of their advertising. But they can also be hugely distracting from TV advertising, no matter how much you’re saturating the market with exposure opportunities for your messages.
Networks are attempting to make the case that live programming is the answer to everyone’s TV problems when in fact it may just be the viewership ratings that benefit from the experiment. Let the buyer beware: There is no guarantee that the exposure opportunities you buy with live TV programming will translate into actual commercial engagement. Airing your commercial on live TV events will, to some extent, address the problems created by DVR technology. However, when the networks jump on the social media bandwagon and encourage second (or more) screen usage, they may be undercutting your ability to engage consumers with your commercial message.
As technology and consumer behavior evolves, the difference between a successful ad campaign and one that fails to deliver for the brand still rests on the ability of the creative to engage and persuade. Advertisers who focus too much on buying TV exposure opportunities and not enough on making great advertising won’t win no matter how many exposure instances networks deliver with their programming.