JKR

Tess Alps

The myth of TV’s decline

Platform is our monthly members' club which meets at the Adam St Club off the Strand to hear first hand the views of leading entrepreneurs and innovators. ??Tess Alps is the chief executive of Thinkbox, the UK's marketing body for commercial broadcasters. Tess's job is to persuade agencies and advertisers that TV is still the best place to spend their marketing budgets. You might be thinking this all sounds a bit twentieth century - what about the Internet?

Tess argues that the perception of the television medium succumbing to the Internet is a myth and seriously misreads how such channels positively benefit TV’s effectiveness as an advertising tool.?? Tess delivered some great insights about consumers' interaction with TV and where it’s headed:

1.    Linear Broadcasting (TV Consumption) has hit an all time high.  In the first quarter of 2010, the average person consumed 30 hours of TV per week, or about 4 hours a day! (Heavy snow may have played a part.)

2.   Approximately 2.5bn ads are viewed in the UK per day on normal speed, 22% more than 5 years ago, which means the average person sees 48 each and every day.

3. PVR’s (or more accurately, DTR’s) are now commonplace, but in practice  only 7% of viewing is to time-shifted TV, (although people record lots more). For Sky Plus viewers this number doubles to about 15%. And although around 70% of adverts are then fast-forwarded, people watch about 17% more TV when they acquire these machines, so the net effect is that people watch about 3% more ads. Plus, in-home observational research reveals that consumers will slow down the playback to watch and even re-watch ads they like. So it appears the impact of ‘time-shifting’ on viewing of advertising has been exaggerated.

4. The more ways we give people to watch TV the more TV they watch. On-demand online TV is adding about 2% on average, and for some people up to 10%, of TV time. And interestingly, 50% of on-demand viewings are made within a day of the original broadcast

5. Internet helps to increase measurability of TV advertising - effectiveness; it appears that increasing numbers of viewers proceed to follow up online while or after watching an ad for a brand or a service relevant to them.

6. Recent research shows that if an ad is shown in HD the consumer engages approximately 10% more then on standard quality TV.

The evening finished with a lively Q&A session, mostly centred around the relative value of TV advertising. While the cost of airtime has dropped sharply during the recession – back to levels last seen in the early '90s - spot rates are recovering as demand picks up. This led to a particularly interesting observation from AB Inbev’s head Stuart McFarlane, who noted that the contest between TV and Internet is arguably a sideshow: the supermarkets make a stronger case than either for influence over consumer good purchasing.

Tess closed with a rather sobering statistic for those of us who might just be taking TV advertising a little bit for granted, by informing us that subscription income for Sky and others exceeds TV advertising revenue, which is now only about a third of the TV’s industry’s total income when you add in the BBC license fee too. For Sky themselves, advertising accounts for less than 10% of their total income. We use it or lose it, perhaps?

The next Platform speaker will be Charlie Bigham on 15th June. There’s a high demand for membership but if you’d like to attend the next Platform, please e-mail Tanja at tanjabrockmeyer@jkr.co.uk and she’ll do her damndest to get you on the list.