After months of hilarious commercials featuring Rob Lowe and his “creepy, loser, loner, etc” alter ego with cable, DirecTV announced that they will be pulling the plug on the commercials. The decision was made reluctantly after the National Advertising Division, part of the Better Business Bureau, ruled that Comcast Corporation’s complaints against the commercial series were valid. The National Advertising Division also recommended getting rid of the slogan from the commercials “Don’t be like this me. Get rid of cable and upgrade to DirecTV” due to the fact that it “conveyed a comparative and unsupportive superiority message”, according to the advertising watch dog.
Rob Lowe commercials were highly effective for DirecTV
While the commercials were certainly enjoyable for a few laughs, from a business standpoint, Rob Lowe commercials really helped DirecTV get out of a subscriber slump. During the third quarter of 2014, DirecTV announced that they had lost 28,000 subscribers during the period. During the fourth quarter 2014, when the commercials began to air, DirecTV saw its new subscriber mark hit 149,000 subscribers for the quarter. This certainly makes sense as to why DirecTV will appeal the ruling, in an attempt to get the right to air the ads again. While the commercials certainly hit a note with consumers, DirecTV is certainly anxious to get “Super Creepy Rob Lowe” back on the airwaves.
Ruling part of a bigger overall coming changes to the cable/satellite industry
While losing the advertisement was bad for DirecTV, it highlights an overall trend that is beginning to take place. Comcast, DirecTV, and Dish are the standard competitors when it comes to cable/satellite TV service providers, they have dominated the market for years, but their reign is coming to an end. The latest trend and “next big thing” is streaming TV from services such as Apple TV, Playstation Vue, etc. Apple and Sony are just 2 examples of big tech giants that built TV streaming packages to take on the “usual suspects”. The interesting part here is that many of these companies such as Apple and Sony have signed deals with big networks and are now advertising their services as a “cord cutter” service that will make you cancel your cable or satellite service.
Vanguard’s move into PE may change the landscape forever
Private equity has been growing in popularity in recent years as more and more big-name funds and institutional investors dive in. Now even indexing giant Vanguard is out to take a piece of the PE pie. During a panel at the Morningstar Investment Conference this year, Fran Kinniry of Vanguard, John Rekenthaler of Morningstar and Read More
The bottom line here is that the Rob Lowe commercials were highly effective for DirecTV. It shows that companies in this industry are needing to get more and more aggressive to gain customers, as its industry is changing. With streaming TV services due out this year, it could represent the beginning of the end for cable and satellite together.