Connected TV: the Facts So Far

Some key findings taken from the UKs first and most in-depth in-home consumer research conducted by Rovi & Decipher UK
(Over 500 Samsung Smart TV owning households were interviewed in late 2011)

The Rovi UK Connected TV Ad Lab

Background
Consumer electronic manufacturers have created a series of internet connected devices that will unlock an exciting world of new content for consumers, enabling them to access online content directly through their TVs and Blu-Ray players. The adoption of these devices and enjoyment of content services such as BBC iPlayer and LoveFilm, amongst others, is going to grow substantially as shown in the chart opposite. These new Smart TVs are following a similar path to that of smart phones and tablets, embracing the concept of Apps and harnessing peoples familiarity with them. As a long time global leading provider of entertainment metadata, technology and TV listings guides/EPGs to Consumer Electronics manufacturers and Service Providers, Rovi is uniquely capable of selling advertising into this exciting new media channel. Rovi has the capability to offer advertising within TV listings/EPG Apps, as well as within exciting new video search and recommendation engines built into the user interfaces of these Smart devices.
Connected TV Market Development UK

Source: Futuresource Consulting Ltd

Rovi/Decipher. Connected TV Ad Lab

Copyright 2012 Rovi Corporation

Smart TV Connected Field Lab Study

Survey of 504 respondents Sourced from Panel recruitment Questioning on usage & attitudes Screenshots/Mockups for competitor evaluation

Effectiveness survey for a set of campaigns running over 2 months Exposed and control samples Ad effectiveness metrics

Family in-home interviews with connected TV households 1 hour sessions Discussion of usage, opinions, and advertising strategy Exploration of multi-platform homes and usage breakdown (ie a Virgin Media home with a connected TV has two ways of getting BBC iPlayer to the TV)

Rovi/Decipher. Connected TV Ad Lab

Copyright 2012 Rovi Corporation

Phase 1: Audience Benchmark

Phase 1 Connected TV Demographics

Owners of connected TVs are younger and more affluent than the national average and more likely to be male. They tend to live in urban areas with almost 1 in 4 connected TV owners living in London.

Rovi/Decipher. Connected TV Ad Lab Phase 1

Copyright 2012 Rovi Corporation

Phase 1 Smart Hub Engagement Effects

The Samsung Smart Hub has had a major effect on connected users viewing behaviour. Usage of Smart Hub stimulates TV viewing, as with 49% claiming it makes them watch more TV. Users were very likely to use the service when with others, and recommend it.

Rovi/Decipher. Connected TV Ad Lab Phase 1

Copyright 2012 Rovi Corporation

Phase 1 Smart Hub Fanatics

Samsung connected users who claim to always use the Smart Hub are young, busy professionals. The majority have Pay TV and 1 in 4 have superfast broadband of at least 50 MB or more. They are heavy media consumers of both linear and on demand content via the Smart Hub.

Rovi/Decipher. Connected TV Ad Lab Phase 1

Copyright 2012 Rovi Corporation

Phase 1 Key Takeaways

Owners of connected Samsung TV/Blu-ray players are younger, more affluent and more likely to be male than the UK average Connected TV users are super-consumers of media content and own a lot of gadgets (7x more likely to own a tablet than average) 84% of connected TV owners use the Smart Hub and in the majority of households its also used by other household members The Samsung Smart Hub has been accessed by about 250k users of which 1 in 2 access it on a frequent basis The primary reasons for using the Smart Hub are the convenience of doing multiple tasks on a single screen and accessing on demand content

Rovi/Decipher. Connected TV Ad Lab Phase 1

Copyright 2012 Rovi Corporation

Phase 1 Key Takeaways

The features of the Samsung Smart Hub were rated very positively, especially the responsiveness of the interface The Smart Hub has a major effect on connected users viewing behaviour with 1 in 2 claiming it makes them watch more TV 3 in 4 Smart Hub users are likely to recommend the feature to others 85% are more interested in buying an HDTV or Blu-Ray Player because of the Smart Hub feature Users like advertising that helps them learn about new products and services available

Rovi/Decipher. Connected TV Ad Lab Phase 1

Copyright 2012 Rovi Corporation

Phase 2: Advertising effectiveness

Phase 2 Participating Brands

This study tracked 8 connected TV campaigns on compatible Samsung devices which were live in January.

Rovi/Decipher. Connected TV Ad Lab Phase 2

Copyright 2012 Rovi Corporation

Phase 2 Advertising Awareness

Ads on the Samsung Smart Hub interface are displayed within the Your Video and the Rovi TV Listings app and of those who visited these recently, the majority noticed the ads and 1 in 5 clicked on an ad.

Rovi/Decipher. Connected TV Ad Lab Phase 2

Copyright 2012 Rovi Corporation

Phase 2 Brand Engagement

Users of the Samsung Smart Hub that were exposed to advertising on the platform had a higher engagement with the advertised brands compared to those not exposed to advertising:

Rovi/Decipher. Connected TV Ad Lab Phase 2

Copyright 2012 Rovi Corporation

Phase 2 Advertising Follow-Up Activity

Users exposed to connected TV advertising are actively engaged* with the brands, 2 in 5 watched the video featured on the brands micro site and 79% participated in any follow-up activity.

Rovi/Decipher. Connected TV Ad Lab Phase 2

Copyright 2012 Rovi Corporation

Phase 2 Key Takeaways

The majority of connected TV owners who visited the apps where adverts are displayed noticed the ads and 1 in 5 also clicked on them (68% noticed the presence of ads) Advertising on connected TVs delivered a 6% incremental reach amongst connected TV owners, in addition to traditional media channels Word of mouth remains the most used promotional tool for telling others (2 in 5 of users exposed to the advertising mentioned the product or brand to someone) Connected TV advertising positively affects brand engagement: Users are more likely to be favourable towards the brand when exposed to connected TV advertising compared to non-exposed (twice as high over all campaigns) Users exposed to connected TV advertising have a higher intent to purchase the advertised product when compared to non-exposed (2.5x higher purchase intent) Users are more likely to engage with key brand statements when exposed to connected TV advertising compared to non-exposed (86% higher brand association)

Rovi/Decipher. Connected TV Ad Lab Phase 2

Copyright 2012 Rovi Corporation

Phase 3: Engagement

Phase 3 Connected TV Audiences

The family make up of households have varying patterns of usage and are motivated differently by their connected TVs.

Couples Technologically Driven

Couples with connected TVs are extremely brand driven. Buying Samsung was a conscious act denoting quality of the brand, compared to LG and Panasonic. Both pay and non pay couples use their connected TV as an integrated part of their busy lives. A connected TV gets their attention and is not in the background.

Young Families Entertainment Focused

Connected TVs provide a way to synthesise family spending time for young families. The key driver is entertainment and ease of use. Pay TV households continue to watch the majority of programmes, aside from BBC iPlayer and You Tube, on their platform provider services.

Mixed viewing
Families with children over 13 have staggered usage. They have their own preferences to the connected TV, with touch points in early weekday evenings to watch together. Connected TVs make the net accessible to older generations within a supportive family network.

Rovi/Decipher. Connected TV Ad Lab Phase 3

Copyright 2012 Rovi Corporation

Phase 3 Advertising Attitudes

Viewers are receptive to advertising in the Smart Hub as it was seen to be subtle, and perceived to be well targeted and interactive. Compared to mass advertising, it felt like the ads formats on the Smart Hub were more personalised and selectively chosen.

Interest in the advertising was driven by

a perception that they were uniquely designed for Smart Hub, and contextually relevant to entertainment. the fact that they were non-interruptive and presented without clutter. the fact that clicking into a unique area encouraged the viewer to take ownership of the experience.

Key benefits of the approach

Rotating advertising reduced frequency burnout. Trailers were the most popular, as they felt like entertainment content in their own right. There was a desire for advertising that offered incentives, such as voucher codes or special offers. They see this TV area as more intimate and personal than a newspaper, magazine or TV broadcast.

Rovi/Decipher. Connected TV Ad Lab Phase 3

Copyright 2012 Rovi Corporation

Phase 3 Key Takeaways

The Smart Hub service is seen by Smart Hub owners as being a highly sophisticated and engaging platform. The current approach to advertising a display ad that launches a TV-friendly microsite is engaging and appropriate. There is little evidence of advertising being seen as intrusive. Ads were not seen as intrusive because they were contextually relevant to the platform. By providing content themselves (such as trailers, clips), they were seen as valuable content in their own right, rather than advertising. Content apps are the most popular, with a great appetite for more content (ie, 4oD and ITV Player would be natural additions). There was claimed desire for utility apps (banking, shopping, betting) however there was little true understanding how these should be implemented to be usable and relevant on the big screen.

Rovi/Decipher. Connected TV Ad Lab Phase 3

Copyright 2012 Rovi Corporation

We are on a constant mission to further understand the in-home family dynamic as it relates to changing entertainment consumption habits, and then drill-down to better acquaint ourselves with consumers preferences and engagement levels with interactive advertising. As reinforced by our survey findings, Smart TV advertising can provide exciting new opportunities for brands to efficiently and effectively reach consumers in the living room.

Jeff Siegel, Senior Vice President of Worldwide Advertising, Rovi Corporation

Copyright 2012 Rovi Corporation

Notes

Rovi/Decipher. Connected TV Ad Lab Phase 1

Copyright 2012 Rovi Corporation

If youd like more information about Connected/Smart TV advertising wed be very pleased to hear from you.
Jon Hewson Advertising Business Director EMEA Rovi Europe Ltd Woolyard 52 Bermondsey Street London SE1 3UD +44 (0)7507 138265 jon.hewson@rovicorp.com

Copyright 2012 Rovi Corporation