The State of Cable - Shifts in Viewing Trends
As digital viewing continues to become more popular, cable networks have experienced fairly steady ratings declines. Virtually all of cable’s top networks suffered double-digit ratings declines in 2014, most notably in C3 ratings, which account for live broadcast viewing plus three days of DVR playback after the original airing. Overall, cable ratings among adults fell 9% in 2014; this figure is three times the rate of decline over 2013.
In Q3 of 2014, the average person watched about 141 hours of live television per month, down from 147 hours in the third quarter of 2013; on a daily basis, viewers are watching 12 minutes less TV than they were a year ago. Nielsen reports that 2014 saw a more significant decline in TV viewing than any previous year, though television and cable viewing still makes up the majority of video viewership hours each week.
The declines can be attributed to the consumer shift to viewing through DVRs, subscription video services, and free online providers: 76% of households now have a DVR, Netflix, or use On Demand services. Between 2012 and 2014, viewers aged 35-49 watched two hours and five minutes less of traditional TV each week and increased viewing of online videos by 35 minutes; overall online video viewing increased by about 4 hours per month from 2013 to 2014. It is estimated that 53% of all viewing among consumers 16-74 is time-shifted, with that number increasing to 61% among the millennial target. On average, viewers spend 14 hours and 20 minutes per month watching time shifted programming: this figure is up 9% year-over year.
Nielsen estimates that 47% of all US households have DVRs. In addition to DVR usage, approximately 40% of households now have at least one subscription video service, such as Netflix or Amazon Prime Instant Video, which is up from 35% in 2013. 13% of households have a multimedia device - like an Apple TV - to stream such content, and the same percentage of households have smart TVs, which can natively stream apps like Netflix.
Out of those US households with DVRs, an estimated 89% fast-forward through commercials a majority of the time: 56% claim to skip every advertisement, and 33% report skipping most of the time. (Only 1% of DVR users state that they never fast-forward through commercials!) While the most cited reason for watching time-shifted programming is convenience (60%), 37% of viewers state that the main reason they utilize a DVR is to skip advertisements.
Advertisers must adjust to these shifts in viewing trends and the constantly evolving state of the video landscape. While cable is still an effective and largely watched medium, creative messaging should consider the effects of DVR usage and brand viewability when most viewers choose to fast-forward through ads. Advertisers should also look to incorporate their messaging within multiple video platforms. Non-skippable video, on demand opportunities, and online video pre-roll are great ways to reach users on multiple screens while they are engaged with content and more likely to remember a brand message.