Many marketers covet the kind of upscale viewers who watch buzzy cable dramas like “Mad Men” and “The Walking Dead.” But the best place to reach them might be, well, not during either “Mad Men” or “The Walking Dead.”
People who watch these kind of shows are far more likely to do so by recording it on a digital video recorder and watching it later, skipping over the ads as they do so, than viewers of other shows, according to research by digital video recorder maker TiVo. Viewers of Madison Avenue drama “Mad Men, ” for instance, skip 73% of the ads. Similarly, 66% of ads during “The Walking Dead” are skipped.
Compare that with another cable show where viewers were less likely to skip ads, HGTV’s “Love It Or List It.” Viewers saw 83% of the ads during the homeowner show. The figures are calculated from the shows’ total audiences, both those watching “live” and those using a DVR up to seven days later.
A word of caution is necessary. TiVo’s research spans the first half of this year and comes from a rolling sample of 350, 000 TiVo boxes in the U.S., which may not be representative of the broader viewing audience, since TiVo owners are perhaps more likely to record. Indeed AMC, which airs both “Mad Men” and “The Walking Dead, ” says in a statement that Nielsen, whose viewer survey is more representative, is “the industry standard for audience measurement and commercial retention.”
Still, the data highlights why use of DVRs, which shrink the number of people who have to sit through commercial breaks, has long been a source of consternation in the TV advertising world. Of course, advertisers and TV networks take ad-skipping into account in their pricing: ad deals are based on the audience levels for commercials, not the programs, viewed live and up to three days after initial broadcast (this year, some ad deals were struck based on viewing up to seven days after broadcast, a formula networks have been pushing for years). Because TV advertising is based on the cost of reaching a thousand people, this pricing arrangement means marketers are not paying for all those people who are skipping over the ads.
What TiVo’s data spotlights is that ad-skipping is making it harder for marketers to reach a certain segment of the audience through TV. And it’s a desirable segment, judging from the prices that advertisers pay for time on shows like “Mad Men” and “The Walking Dead.” The average cost of a 30-second “Mad Men” commercial was $69, 500 for the first half of the 2013-2014 season, according to data firm SQAD, while “The Walking Dead” cost $97, 000. In contrast, a 30-second spot on “Love It Or List It” cost an average of $13, 000.
Here is TiVo’s list of the 10 cable shows with the lowest commercial retention from January to June of this year, meaning that viewers skipped the most ads. The figure represents the percentage of ads retained. As you can see, these are some of the more talked-about shows of the season:
- Mad Men (AMC) – 27%
- Justified (FX) – 30%
- Halt And Catch Fire (AMC) – 31%
- Fargo (FX) – 33%
- The Americans (FX) – 33%
- Suits (USA) – 33%
- The Walking Dead (AMC) – 34%
- Vikings (History) – 35%
- Warehouse 13 (Syfy) – 35%
- Top Chef (Bravo) – 36%
Much of the viewing for these shows was done through a DVR, which helps to explain why so few ads were retained. For instance, TiVo estimates that only 11.2% of viewers watched “Mad Men” live versus 70% for HGTV’s “Caribbean Life, ” which falls on the opposite list — viewers who actually watched the ads.
AMC says it “delivers some of the highest levels of audience engagement and commercial delivery on television, driven by passionate fans who consider our shows ‘must watch’ programming.”
Here is TiVo’s list of the 10 cable shows with the highest commercial retention. Again, the figure represents the percentage of ads retained by viewers.
- House Hunters International (HGTV) – 84%
- Bam’s Bad Ass Game Show (TBS) – 84%
- Caribbean Life (HGTV) – 84%
- Love It Or List It (HGTV) – 83%
- Gold Rush (Discovery) – 82%
- Haunted Hathaways (Nickelodeon) – 81%
- Island Hunters (HGTV) – 81%
- Property Virgins (HGTV) – 80%
- House Hunters Reno (HGTV) – 80%
- Beachfront Bargain (HGTV) – 79%
These programs are not the most talked about shows on TV, of course. They’re by and large reality shows and lend themselves to live viewing even if the viewer hasn’t followed along week-to-week, as opposed to the scripted dramas in the first list.
HGTV has most of the shows on the list. Lee Hall, a spokesman from HGTV-owner Scripps Network Interactive, says “viewers tend to look at the ads as content as opposed to commercial breaks.”
The price of advertising for these shows is less. According to SQAD, a 30-second ad for “Bam’s Bad Ass Game Show” averaged $13, 700 for the first half of the 2013-2014 season. Discovery’s “Gold Rush” averaged $16, 000.
What the data suggests is that to a certain extent, networks like AMC and FX are now a victim of their own success. When viewers absolutely must know what happens to Don Draper, they don’t want ads getting in the way. And it just so happens that those elusive viewers who don’t want to watch ads are some of the most important to advertisers. The challenge for marketers, then, becomes where else to find the sacred “Mad Men” viewer other than through the show itself.
Some media executives believe that ad-skipping on video recorders will become a moot issue as use of video-on-demand — in which ads can’t be skipped — supplants DVRs. How viewers used to ad-skipping will respond to that shift remains to be seen. Moreover, some of the above shows’ earlier seasons are available on Netflix, where the ads don’t run.