The future of TV

Posted 2010.03.18

In the last few posts we looked at the rising TV consumption, increasing effectiveness if TV advertising and the power of TV in creating emotional engagement. So what does the future hold for TV advertising? There is no doubt TV as a medium will need to face some challenges. Consumers’ insatiable appetite for content probably does not apply to advertising. Time Warner Cable viewers in the US get served 32 ads per hour. On Hulu they either get only four ads per hour, or one long ad at the beginning and then half an hour of uninterrupted viewing. This probably explains some of Hulu’s success. In July 2009, 38 million people streamed videos from Hulu – that’s more than Time Warner Cable … . DVR penetration is bound to grow and with it the volume of households who will timeshift and also skip ads.

But there are also plenty of opportunities in the future that will help make TV advertising become more effective. We will continue to become better at optimizing our TV advertising. The insights into the power of TV at the sub conscious level through the creation of emotional engagement are pretty recent and have not yet been applied to the majority of the TV advertising out there. Also, TV will become increasingly addressable. In traditional addressable media it is not uncommon to see double digit improvements in performance as a result of more sophisticated targeting. There is no reason why we shouldn’t expect similar improvements when these techniques will become common practice for TV. And then there TV’s liberation from the conventional living room TV set. I mentioned Hulu’s success before. Game consoles like the XBOX 360, PS3 and Wii have been innovating in this field and are now offering TV content as well as social media and web browsing capabilities all in one integrated multimedia platform. I just signed up on Netflix through my Xbox 360. This allows me to stream the movies to my TV without having to wait for the DVD’s to arrive. Finally there is the quality of the TV content itself which has been taken to a whole new level over the last years. Shows like Lost, 24 and Mad Men are produced in motion picture quality and have highly sophisticated plots that keep viewers hooked week after week.

While TV advertising might not be as dominant as it once was it most certainly will continue to a very viable and effective communications channel.