TV advertising set for massive slump, US research says

NEW YORK - More than three quarters of advertisers believe TV advertising is now less effective than it was two years ago due to the mounting threat of digital video recorders and video on demand, according to a survey released in the US.

The survey, carried out by Forrester Research and presented at the Association of National Advertisers conference in New York, involved 133 of the country's biggest advertisers, including Johnson & Johnson, Colgate and Pfizer.

As well as revealing that 78% of advertisers believe traditional TV advertising has become less effective in the past two years, 60% indicated they will spend less on the medium when the number of homes with DVRs reaches 30m. Those that anticipate cutting their budgets said this is likely to be by at least 25%.

Josh Bernoff, vice-president of Forrester, said: "Television networks continue to publish research that traditional TV advertising is potent as ever, but national advertisers aren't buying it and are seeking alternatives to enhance their budgets and move them beyond the customary 30-second spot."

However, the decline in the traditional 30 TV spot will mean a boon for other types of marketing.

Product placement, programme sponsorship, interactive advertising are all set to benefit, as well as advertising within programmes and online video ads, the research concludes.

There are currently 11.4m homes in the US with digital video recorders.

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