U.S. marketers spend about $70 billion annually on television advertising. What happens if the data guiding those investments was wrong?
TiVo, the little gadget that helps you record television programming, is poised to give Nielsen serious competition in how video audiences are measured — and perhaps to fill some gaps. Nielsen, as you know, compiles ratings for television programming that explain what percent — or share — of the 114 million TV sets in the United States are tuned to any program. Trouble is, Nielsen bases such ratings on a sample of 25,000 U.S. households. While Nielsen does process more than 2 million paper diaries in its four “sweeps” heavy observation periods, in general only 0.02% of the entire U.S. television audience is actually measured — and 99.9% is not.
TiVo will shake that up by releasing directly observed data on 375,000 households: second-by-second viewing from TiVo’s set-top boxes including whether you skip commercials, play shows back later, or pump content from Hulu or YouTube through your set. Critics have long pointed out that Nielsen’s panel-based measurement leads to errors. Panelists tend to overestimate their viewing of new programs they think they’d like; college students, in that sweet youth demo, have been underrepresented; viewing outside of the home, such as in bars, is not recorded; and thanks to the blunt scoring system, some shows with real audiences have been given 0.0 share. New data is coming, and the shifts may unnerve $70 billion in TV investments.
Image: Môsieur J.
The media ratings service Nielsen made two humongo moves recently that acknowledge video viewing is migrating away from live television. On Wednesday, it announced it would no longer track how many TV channels the typical U.S. consumer receives, because as MediaPost reports, “there no longer is a ‘consistent’ meaning for the term ‘channel.’ “
But the real story is this: Nielsen has also decided to change the very nature of television ratings by including “duplicate” viewing — as in, you watch a TV show tonight, and then you watch it again by playing it back on a DVR. This may sound like a nuance, but it is a huge shift in the concept of a media audience delivered. Advertising impressions have always been perceived as mutually exclusive. A newspaper with 100,000 circulation is assumed to reach 100,000 different sets of eyeballs. Broadcast is fuzzier, of course — a 100 GRP schedule could reach 100% of the viewing population once, or 1% of that population 100 times — but at the micro level of a single commercial airing, each audience has been assumed to be unique.
No more. A critic might suspect this move is Nielsen’s way of bolstering the broadcast industry, by boosting ratings numbers as audiences start to slide elsewhere. Magazine and newspaper publishers have tried similar gamesmanship with their BS “readership” malarkey; back in 2007, for instance, Essence magazine claimed its 1.07 million printed copies reached 7.8 million readers thanks to the magic of “passalong readership.” (“Look, honey, Essence magazine came in the mail — let’s hold a party and invite all our friends!”) Is Nielsen gaming the system by adding in numbers beyond the “live audience” to now include duplicates as well? Perhaps. Either way, the real challenge for advertisers is Nielsen provides no way to determine if any of that downstream DVR audience skips over commercials entirely.
One of the great myths of our advertising generation is that traditional media is dying. Never mind that 30% of U.S. homes own four or more TV sets, or that the very bloggers who proclaim 30-second spots are dead also promote Panasonic high-definition televisions. Media is certainly shifting, but it’s an additive landscape — because new communication tools are overlaying old media, not replacing it.
Forrester analyst Josh Bernoff said this week that social media may be boosting television ratings, as consumers find new impetus to tune in to community events. Ratings are up in 2010 for the Grammys (26 million viewers this year vs. 19 million last), the Golden Globes (up 14%), and the Super Bowl (at 106 million viewers on CBS in January, it was the most-watched TV event of all time). Media is additive because consumers are learning to do two things at once; Nielsen reports that 13% of viewers of the Olympics’ opening ceremonies were also online typing away on Twitter or Facebook.
There is no question that the currency of advertising impressions is becoming devalued, and thus marketing is more challenging, but it’s a reset — not a vaporization. This week we discussed where all media is going with the verbally elegant Angela Natividad and ideation guru Bill Green on the AdVerve podcast.
You can almost hear the executives at Viacom, MTV’s parent anticipating an 8% slide in operating income in 2009, pound the board table shouting: GIVE US MORE SKIN!
MTV’s audience ratings are down 23.9% in fourth quarter 08 vs. the year prior. The masses of teens are moving from TV viewing to web sites, social media and mobile, so MTV is tarting up new reality shows such as “A Double Shot At Love” where bisexual twin women in tiny bikinis try to decide whom to have sex with. We like the subtle promotion where one hints she has an extra part. The twins’ last names — we can’t make this up — are Ikki.**
Now, dear prudes, let’s pause and consider the Darwinian pressure on content producers to evolve sexual content — because sex still works. In 2008 we saw beavers selling Kotex feminine products in Australia, animals lap-dancing for Orangina in the UK, Calvin Klein baring Eva Mendes‘ breasts, and our personal over-the-top favorite: A Burger King paper tray liner showing cartoons of vegetables cavorting in a red light district. The Kotex-beaver spot drew howls of protest when it first launched but later was credited with capturing 2% more share of Australia’s $250 million tampon market … in just a few months.
Hypersexed advertising also creates a halo effect of public relations, as media tut-tuts over the supposed scandal and provides millions of dollars in additional free advertising. Some of today’s best agencies, such as Crispin Porter, practically build in “public scandal” as a second line on every advertising media plan.
Finally, offline media must compete with the no-skin-barred online world, in which full nudity (as in this promotion for Elave) can be used in videos and sent around with no FCC to stop the message. Sex sells. Sex creates PR. And heck, the online competition uses sex everywhere. It all adds up to more provocation in the year ahead as mainstream media advertisers get desperate for a little more consumer love.
** CORRECTION: Our agency has an eyewitness account from Sarah Ely, who notes the MTV twins’ names are Rikki and Vikki, hence the double-K Ikki. “In the first episode the challenge was for guy and girl teams to lick frosting off of mannequins. They were at it for like two hours.” Now we must tune in!
The debate over fixing inaccurate radio ratings continues. Arbitron has been attempting to roll out a new electronic, pager-sized device called the Portable People Meter that would accurately measure which radio stations panelists listen to.
The PPM picks up an inaudible signal from the radio to record exact listener habits. This is an important move for radio, because for decades media planners have had to rely on diaries from audience samples … known to be inaccurate. In the past, a panelist might write “I listened to Country Station X all morning” … but the PPM captures the fact that user changes the dial.
Yes. Probably when a commercial comes on.
The PPM has been getting flack from major radio networks because it has found many radio stations have lower ratings than previously thought. If users skip around, they listen to more stations for less time. And few analysts are commenting, but it is obvious the trigger that drives a radio listener to change the dial is a long commercial block — meaning the “ratings” for a commercial are even lower than the official numbers.
Now, lawsuits from the attorneys general of New York and New Jersey complain the new PPM device also undercounts minority listeners, which hurts the ratings of urban stations and thus the revenue they can command from advertising. The suits claim Arbitron under-represents minorities because it only recruits research panelists from homes with regular phone land lines, and many minorities in urban markets only use cell phones.
Not sure when this dispute will end, but for now, take all radio ratings with a grain of salt. Your best bet? When you spend on radio, set up your own system to measure the results.
Photo: Thomas Hawk
The Portable People Meter is an interesting device — it’s a little cell-phone sized gadget that allows the ratings group for radio to accurately record the exact station a consumer is tuned into. This meter picks up a signal from the radio station, and replaces diaries as an exact way to track radio ratings.
And guess what — as the new PPM system is unrolled in markets, radio ratings are tanking. It seems consumers skip around the dial more than previously thought, and while journals didn’t always capture the truth (say, someone might write in they listen to Howard Stern for 2 hours in the morning), the PPM device doesn’t lie (the consumer may actually change the dial during commercial breaks). Ratings in many markets are down by as much as 30%. Ratings were so startling low, in fact, that Arbitron launched a PR campaign trying to convince media planners that 70 of the new PPM GRPs were as good as 100 of the old ones.
Now, Arbitron is delaying the rollout of the PPM due to controversy over the new ratings results. A lot of networks don’t seem to like the truth. Clear Channel, Radio One, Cumulus, and Cox Radio have protested — because younger demographic groups, in particular minorities, have lower ratings with the new accurate PPM systems. Young audiences are a particularly sweet target for advertisers, and if their ratings fall, ad revenue will dry up.
There are only two ways this can break. Either the truth is young people don’t listen to radio as much as they used to, and instead use MP3s and cell phones to communicate (duh), or the electronic monitoring system has flaws in technology or sample sizes (uh-huh). We don’t know the truth, but we do predict when it arrives, the truth will set radio ratings free.
Arbitron reports the new PPM should be in eight of the nine delayed markets, including New York, Chicago and Los Angeles, by September 2008. For now, PPM is only active in Houston and Philadelphia.
Media planners frustrated with radio’s failing ratings, take heart. The estimable Erwin Ephron ran tests to find that radio, when combined with TV, can achieve 30% higher impression levels for the same budget dollar. Ephron crunched the math to back the old argument that two broadcast media work better in unison than one. Still, he misses a key point–MRI research shows that consumers exposed to commercial radio often are not fully attentive. 30% up in reach, 30% down in attention, and the media plan still has static.
Cheerful news for the National Association of Broadcasters Radio Show in Charlotte, N.C. last week. Michael Harrison, publisher of talk-radio mag Talkers, told an audience of radio execs that terrestrial radio will be killed off within 20 years, replaced by cell phones, satellite, MP3s, the Internet, Wi-Fi, and high school marching bands. Radio execs are simply in denial, Harrison said, and “it’s amazing how little our industry is doing to slow the deterioriation.”
Arbitron execs reportedly charged the stage and said, don’t worry. Because 70 GRPs are the new 100.
Arbitron insults your intelligence with a new spin campaign about GRPs. It’s pure baloney. Marketers and media planners should cry foul.
A new electronic measurement system for radio ratings has exposed the fact that GRPs aren’t what we thought they were — real ratings are actually off 30% or more in the first two markets, Philly and Houston, where the Portable People Meter was used. This PPM device replaces diaries to monitor how people really listen to radio, and it found people skip around the dial a lot more than previously thought — in general, hurting ratings of any single station. The PPM system goes to NYC next, and by end of ’08 will be in the top 10 U.S. markets.
This means your radio buys have been weaker than you thought. Marketers who thought they were buying 100 GRPs were really only getting 70 GRPs for their money. If they want to get to 100 gross rating points, they’ll now need to spend more. Arbitron is trying to mask the bad news with full-page ads in MediaWeek telling buyers that the new GRPs are more powerful. In actuality, 30% of the old GRPs have vaporized.
There is some good news as radio ratings tank — the more accurate data will allow media buyers to build more sophisticated plans, buying deeper into lower-ranked stations to get exactly the reach and frequency clients want. With a real read on the audience, we can now place ads more likely to hit the real listening target, which in turn should boost responses and customer action.
But come on, Arbitron. Launching a PR campaign saying 70 PPM GRPs is the new 100 is a bit silly. Here’s what we suggest. Send us a check for $100,000. We’ll put it in a bank for you. And we’ll call you tomorrow saying, whoops, you only have $70,000 in your account. But don’t worry — 70 is the new 100.
(For a detailed look at how far 100 GRPs have fallen in radio, here’s a table showing TRP details for Philly. If you thought you had 100 TRPs for teens A12-17 Mon-Fri 3P-7P, you really only had 54.)
Audi fans, follow this bouncing ball. Magna Global releases a study showing TV commercial ratings are dropping off a cliff in homes with DVRs. It gets bad. Real bad. Apparently commercial ratings are 39 percent lower than program ratings in houses with those black boxes that record and play back TV. And when only playback periods are measured, commercial ratings fall to 64 percent lower.
This means (a) people are skipping TV commercials, (b) advertisers need HeadOn! topical headache medicine, and (c) Audi is fighting back! Audi released two kindacool commercials that are sped up, with the idea you have to slow them down with your DVR remote to fully enjoy them.
And then the story gets strange. Perhaps worried most consumers can barely find the remote, Audi released the clip above on YouTube to explain how to slow down commercials with your DVR remote.
OK, we know 1 in 5 homes has a DVR and this commercial-skipping thing is going to get worse. But sending your customers to the web to YouTube to find your instruction video to get instructions to record your commercial on a DVR and then use the remote at a later date to stop, rewind, and slow down the commercial is giving me a headache. Methinks an ad agency somewhere thinks too much. HeadOn! HeadOn!