Sky today released a study looking at entertainment trends in the U.S. and the U.K. It finds that there are more devices per household and more entertainment options, but there are also major differences between Americans and Brits in terms of how the devices are used.
Below, some key findings, followed by an interview about the report with Hilary Perchard, VP Business Development, Sky
– 98% of Americans own a TV, and 22% own a digital media player (Roku, Chromecast, etc.)
– While 82% of Americans own an HDTV, only 22% of these TVs are smart TVs
– 53% of Americans own a tablet, while 64% of Brits do
– 39% of those surveyed have Netflix, while 14% have access to Amazon.
– People are increasingly distracted while watching TV: 57% of Americans use their laptops, 44% use their smartphones, 23% use their tablets, and 47% perform household chores.
– The top three activities while watching TV are: checking email, browsing the web, and social media.
Lost Remote: What are some of the most surprising TV-related findings from the study?
Hilary Perchard: Today, entertainment takes all forms across new and emerging digital platforms as well as more established formats. Technology has created new opportunities for entertainment and new behaviors, however they have not done so at the expense of “old media” consumption – people still seek a “lean back” TV experience, enjoy listening to music in their cars, reading and going to the movies. We can we see that many of the other forms of entertainment overlap as we multitask (watch TV, check email, use social networks, etc.). This means that even in our increasingly busy lives and all the distractions we have, we’re still finding time to be entertained and to communicate.
LR: Americans own more devices than anybody, but why is tablet penetration so much greater in the U.K.?
Perchard: Good question! Not sure it’s related to any cultural issue. The U.K. has traditionally been an early adopter market (smart phone penetration is very high, for example), so it’s just a result of market dynamics (lots of quality products, competitively priced, with a public that has embraced tablet computing). Although as an interesting aside, tablet sales are down globally as smart phone screens get bigger and tablets get squeezed between smartphones and laptops.
LR: Do you expect DMP (like Roku and Chromecast) numbers to continue to increase in coming years, or does a rising number of smart TV households mean that DMP numbers have peaked?
Perchard: User experience and access to content will decide the winners as consumers have more ways to “connect.” The evidence to date is that consumers seem to prefer streaming services like Roku and MSO offerings like Sky+ over connected TVs.
We expect all forms of connected devices (TVs, consoles, DMPs, set-top boxes) to grow, as more and more people seek to combine the best of Internet TV with the best of broadcast. With broadband speeds and coverage improving all the time, and advances in connected platforms (both in terms of number of offerings plus improving functionality) more and more content will be delivered via the web. This will simply open the market to even more homes.
The battle between connected platforms will not be based on form, but function. The winners will combine access to the best content, most accessible and initiative user interface and good value for money. And they need to understand content and how consumers want to access it. Content needs to lead the technology, not vice versa.
LR: Networks and advertisers are concerned about the death of live TV, but don’t the numbers from the study show otherwise?
Perchard: The death of live TV is an overstatement. We see that amongst our own customers linear TV is still by far the most preferred way to watch TV, even when consumers have DVR and VOD – and the numbers have remained fairly consistent over the years. There is still some content that is better suited to on demand – movies and boxsets – but there is much – drama and sports – which are best enjoyed live.
TV is a “lean back” experience. After a long day at work, a rush to get the kids home, fed and up to bed, most consumers want to relax and be entertained. TV is also a social experience. Watching live TV provides the opportunity to share the experience with friends, whether in person, on the phone, or over social media. On demand eliminates the opportunity to discuss the latest episode of a popular show around the water cooler. All that said, on a rainy Sunday most everyone enjoys curling up on the couch with a boxed set of his or her favorite show.
It’s a mixed ecology. Some content is more likely to be watched live (e.g. sport, news, appointment to view entertainment shows) whereas other genres (movies, drama, box sets) are best suited to DVR or on demand. Linear TV remains resilient and for many, TV remains a lean back experience. People want to be entertainment and will use trusted channels brands (and the experienced TV schedulers those channel employ) to serve up great entertainment in a passive way. They may also want to be part of the national conversation around certain shows or sports event, which means catching it live (these genres have great value, but short shelf lives – e.g. the Superbowl or the Academy Awards). But on the other side of the coin, the rapid growth of movies on demand and box set (which are less time sensitive, have a longer shelf life) also shows that on demand and DVR are important too.
It’s not either or, but both. And more choice and control for viewers over how they access content typically means that they simply consume more of it, which is brilliant news for content owners, and advertisers too, so long as they can innovate their ad model to embrace new formats (e.g. mobile, on demand). But linear TV is alive and well, and so too is regular linear advertising. Again, just think of the value of the ad spots during half time at the Superbowl or Soccer World Cup final.
LR: We tend to focus on our coverage on people using social media while watching TV, but your study finds that the top three activities while watching include checking email and browsing the web. Two questions here: should TV advertisers be coordinating email campaigns with shows, and, is web browsing people are engaging in at least related to the shows being watched?
Perchard: For social media savvy audiences we see that TV often leads social conversations. TV is one of the main triggers for social conversations – especially for linear shows that are being consumed simultaneously by large groups of peers, friends or family. What’s more, engaging, must-see content is more likely to involve a second screen activity that’s related to that content. General web browsing and/or email may point of a more passive viewing experience where the viewer is less engaged and the content is simply in the background. By and large advertisers are more likely to want to tap into those audiences that are engaged with a piece of content. Just because social interaction isn’t number one across the population at large, we expect it is for younger, more digitally engaged audiences. This should be of enormous interest to advertisers.
We are moving to a world where we will see a lot of personally targeted consequential and sequential advertising across platforms. Sky is embracing this with its launch of Sky AdSmart. Today linear TV advertising can be targeted to a consumer and soon we will extend this to second screens so that a sequential ad can be served. Essentially retargeting is going to come to TV.