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TV Ads Are Less Effective, Survey Says

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NEW YORK A majority of marketers believe that television advertising has become less effective in the past two years, according to a new survey from the National Association of Advertisers and Forrester Research.

Over 50 percent of marketers reported that when half of all television households use DVRs, they would cut spending on TV advertising by 12 percent. Current DVR penetration is estimated to be nearly 25 percent.

At the same time they also seem to be somewhat happier with the performance of their media agencies in dealing with all the changes occurring across the media landscape. Still, 28 percent of respondents reported that their media agency is ill-equipped to address the changes in TV advertising, compared to 47 percent two years ago. 

Creative agencies did not fare as well, with 47 percent of marketers indicating that their creative shop was still ill-equipped to help deal with changes, a slight improvement from 55 percent of marketers two years ago.

The study, which polled 78 leading advertisers in January across all major industries and categories, found that 62 percent of those surveyed believe TV ads are less effective.

But marketers are interested in exploring new ad formats and new forms of video commercials, according to the survey, the full results of which will be revealed at the ANA's TV and Everything Video Forum on Feb. 28 at the New York Marriott Marquis.
 
Close to half of the advertisers surveyed have already started to experiment with new ad types to display via DVRs and VOD programs. Eighty-seven percent of advertisers believe branded entertainment will play a stronger role in TV advertising in the coming year.

A majority of those surveyed said they were eager to try new ad formats in online TV shows (65 percent) and ads embedded in VOD (55 percent). Forty-three percent said they were intrigued by interactive TV ads, while about a third expressed interest in exploring ads within the set-top box menu.

Eighty-seven percent of respondents said they intend to spend more on Web advertising this year. Seventy-two percent of marketers said they want more detailed TV ratings, e.g., individual commercial ratings rather than average commercial ratings. Most advertisers currently use the latter to buy network TV ads.
 
"As marketers embrace the richness of new advertising avenues outside of the traditional TV format, the TV industry is working to address marketers' issues related to ratings and the changing TV landscape," said Bob Liodice, president and CEO of the ANA, in a statement. "Marketers, in collaboration with the TV industry, will continue to find the most effective and innovative ways to reach their customers through the TV medium, utilizing the emerging technologies available to them."

The study also reported that two-thirds of the respondents indicated that C-level executives are watching the changes in TV advertising more closely, up from 54 percent two years ago.