Information from a newly released study conducted by IRI and TiVo has demonstrated the inevitable: lower product sales within TiVo homes. Within the CPG category, one product saw a sales drop as large as 12%, where two other unnamed brands registered declines of 5% and 1% respectively.
First blush indicates the intuitively obvious, namely that TiVo is the Grim Reaper for TV Advertising. No question. But then again, it does also allude to the hypothesis that TV advertising works (after all, sales were higher in non-DVR homes)
Yes and No. As I wrote in Life after the 30-second spot, the question is not whether TV advertising works or not, it's how well does it work. And one thing most people will agree on nowadays is that it's not working nearly as well as it did in the past.
Ultimately, there are many variables in play that make it rather challenging to determine a one-size-fits-all conclusion at this stage. For example, the 12% brand was in a particularly price sensitive category and thus, it stands to reason that the TV advertising served a superficial purpose of blasting across a price point i.e. maximum reinforcement of a minimal proof point.
Furthermore, who's to say that the 12% wasn't already coming from an equity base which a) has been steadily declining and b) was a minority compared to the overall existing wastage.
The DVR-homes are most likely not buying any less of their daily or weekly essentials. They're just getting their information from other expanded sources, experimenting with new brands and most likely purchasing house-brands which they know are the same brands anyway minus the packaging and the premium. If they're smart enough to buy a TiVo, they're probably smart enough in terms of how they shop.
DVR-homes represent consumers that are higher up on the media-evolution chain, but it's just a matter of time before most (if not all) homes follow suit. And when that happens, those double digit percentage point drops are going to need to be made up elsewhere...
(via Ad Age)