DVRs don't strike fear with movie marketers

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There's little question that the digital video recorder has changed the viewing habits of its owners. What's less understood, however, is how it has changed the way those owners view (or skip) ads -- and whether marketers should be worried. Fortunately, reports of the death of the 30-second spot might be exaggerated.

According to a February study by the Nielsen Co. (parent company of The Hollywood Reporter), owners of DVRs watch, on average, two-thirds of the ads, largely because they continue to view the bulk of their programming live, rather than recorded. Better news still, according to the study, DVR owners watch some 40% of the commercials they could simply skip.

"The jury is still out on that," says Russell Schwartz, president of domestic marketing for New Line Cinema, referring to the long-term impact of DVRs. "But I don't think DVRs are going to completely squash commercials. If it is about 'event' programming, people want to see the event when it happens."

Movie advertisers rarely have felt the DVR skipping pinch, largely because a viewer who will skip ads for Drano and diapers will stop and watch one for Sony's next "Spider-Man" installment.

"Movie advertising is still entertainment to some extent," says Karen Hermelin, managing director of MarketCast, one of the primary suppliers of research to the motion picture industry. "People will TiVo through ads but are more likely to stop on movie ads and check them out."

It's not that movie marketers are not concerned about the DVR impact, but those concerns have been tempered by other factors. The Film Department CEO Mark Gill, a former marketing head at Miramax and Warner Independent Pictures, says he knows quite a few movie fans who skip all the ads. "But (the impact) is not as great as (some) would have you believe," he says. "The sky isn't falling because there are only so many DVRs out there."

Other movie marketers point out that though viewers are ad-skipping, a movie's visibility relies on multiple venues, from billboards to the Internet. "TV is still the No. 1 place that viewers make a choice about seeing a movie," says Geoffrey Ammer, former worldwide president of marketing at Sony who now heads G2 Consulting. "But there are so many avenues in addition to spot TV ... the Internet, radio stations, newspapers. You're just covering all your bases and not relying entirely on TV."

Precise details on how audiences watch commercials should be forthcoming this month, when Nielsen begins releasing ratings for commercials.

But in the meanwhile, the industry continues to evolve to anticipate DVR usage. Says Hermelin: "When TiVo users hit the eight-second return button to make sure they're getting the very beginning of their show, they often land on the tail end of the last commercial. Everyone used to fight to be the first commercial in the block of ads. In my perception, people are now fighting to have the last spot, and they want to make sure the end of the ad pops."

-- Debra Kaufman, with additional reporting by Stephen Galloway

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