Within the past couple of years, as the regular use of DVR technology spread beyond penniless technophiles and Jonah’s excessive viewing of Dog Whisperer episodes, there has been a lot of fretting in the media world about the imminent demise of TV advertising. Once viewers start fast-forwarding through all the commercials, it was said, the business model for major TV networks would go the way of newspaper classified ads, presenting marketers with big challenges and viewers with an increasing quantity of cheap-to-produce reality shows of dubious quality.
These assumptions were a bit hasty, according to a new study from three university researchers. It turns out that DVRs aren’t killing the ad business.
The researchers who conducted the study expected to find that DVRs did indeed affect consumers’ shopping behavior, said Carl F. Mela, a professor at Duke’s Fuqua School of Business. They were beguiled by data such as a 2006 survey by the Association of National Advertisers that found that six advertisers in ten planned to cut their TV spending because of the growing popularity of DVRs. The assumption at the outset was that DVRs do affect buying habits, the only question being how much.
When the answer turned out to be not at all, Mela and his colleagues dove deeper but came up with the same conclusion. “No matter what we did, we found . . . no effect,” Mela said. “Not only that, we are incredibly confident about it, in a statistical sense.”
One might argue that TV ads had already lost their salience before the new technology came along, but other recent research suggests that’s not the case. Better explanations for the researchers’ finding include the fact that viewers fast-forward through commercials less in practice than they say they do in surveys, and that some ads retains their effectiveness even during fast-forwards.
It seems that advertising remains good business.