Thursday, March 4, 2010

Time shifted TV ratings a real drama

By John Sintras
CEO, Starcom MediaVest Group

To the casual observer, Australia’s first weeks of time shifted viewing data may look less significant than expected. Make no mistake though: we are in the midst of a major structural shift, and we are all on a continual steep learning curve as we examine the early results and implications for programming and advertising. TV program engagement is stronger than ever, but the impact on traditional ‘ad breaks’ needs to be watched and assessed very carefully.

Although the data has been collected since December 27th, 2009, we have only started to see the results from regular programming in the last couple of weeks. While the first four weeks of January data showed that only about 3% of overall viewing was time shifted (lower than anticipated), this is growing as regular ‘must watch’ programming returns to our screens.

The latest week of consolidated ratings data shows that time shifted viewing has grown to 5%, more in line with what we were originally anticipating. Further, homes with a PVR time shifted more than double the amount of viewing at 12%. Given that a further 25% of households intend to acquire a PVR in the next year, the overall amount of time shifting will inevitably creep up to this 12% level and beyond.

There are few significant variations by age at this stage, although predictably shifting is much less prevalent for the over 65 year olds. As widely anticipated and reported this week, it’s the drama programs that are showing the big lifts with the incorporation of time shifted viewing. Ten’s The Good Wife went from number six in the overnight ratings to number one in the consolidated ratings, a lift of 9.8%. NCIS also lifted from number four to number two with a lift of 8.1%. Cougar Town also experienced a 7.9% lift, although it could be called a comedy drama. The strong time-shifted performance of drama is consistent with overseas findings and will continue to grow as PVR penetration increases.

The real drama though comes from an investigation of commercial break ratings. In Australia, ratings are made available minute by minute for post analysis of TV spots, but unlike the US, there is no aggregation of commercial break ratings for planning purposes. This means that TV planners and buyers must allow for an amount of ratings drop-off when they buy TV to allow for the inevitable drop between program averages and appearing in a commercial break. And here’s the crunch. The amount that we have been allowing for this ‘drop-off’ is getting higher with the new TV data. Further, it is varying quite dramatically depending on the program type and the amount of time shifting within it.

TEN is quite rightly delighted that its new drama The Good Wife took the top spot on February 7, allowing for time shifted viewing. But let’s take a closer look at the ad break data. For live viewing, there was a 6% drop off in the ad breaks, which is fairly consistent with what we’ve historically seen (and plan for). While the inclusion of time shifting adds almost 12% to the program’s average live audience, the drop off in ads breaks increases from 6% to 11% overall, as 53% of the 165,000 people who watched it later fast-forwarded the ads. This figure is even higher in homes with a PVR, where there is an 18% drop off in the consolidated ad break data.

To be fair to TEN, it still ends up with more viewers in the commercial breaks even allowing for the ad fast-forwarding in playback, but not as much as the program average implies (+5.9% vs +11.9%). This pattern is fairly consistent across dramas on all commercial networks.

Clearly as PVR penetration increases the difference between the program and commercial break ratings will continue to increase. There are two big implications here.

Firstly, in-program content will become quantifiably more valuable based on the higher number of viewers. Commercial networks have an opportunity here to justify a premium for sponsorships and associations that guarantee advertisers relevant exposure within programming.

Secondly, the flip side is that the commercial breaks will increasingly deliver less viewers which will put pressure on the historical value equation of the traditional commercial break.

This behaviour is not new, it was happening last year, presumably in similar quantities. The difference is we can now measure it. It’s time for the industry to look at the introduction of a commercial ratings planning database so that advertisers and their media agencies can more accurately plan and buy activity in commercial breaks. This may well result in a re-valuing of commercial versus in-program activity, but isn’t it better to be dealing with the reality of who’s seeing what rather than misleading program averages?

Written by John Sintras for

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