The Battle to Build a Better TV Ratings System: 6 Alternative Ways to Measure Viewing
With Nielsen under attack and viewership splintering, several new companies (including Nielsen itself) are devising tools to supplement traditional measurement.
This story first appeared in the May 22 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.
As the media industry braces for another upfront buying season, a major emerging narrative is the increasing challenge of measuring all the different ways viewers are consuming shows. Many cable networks, including FX, HBO and Discovery, have stopped reporting overnight viewership numbers, instead preferring to wait for at least three days of delayed playback. While Nielsen TV ratings remain the only accepted market currency for ad buyers, the company's dominance is under attack, and it has begun experimenting with measuring digital viewership on platforms like Roku. (Analysts are predicting that the broadcast upfront haul will dip 7 percent to $20 billion for broadcast and cable. Meanwhile, digital video advertising is growing at a robust clip. The sector notched a 17 percent uptick last year to $3.3 billion, according to the Interactive Advertising Bureau.) Now there are myriad other tools that let networks track digital consumption of content, including comScore, Hulu Partner Portal and TiVo Analytics. The Nielsen sample of 25,000 homes remains a sticking point with many in the industry convinced that the size is too small to convey an accurate representative measurement. Nielsen, for its part, says it is working on doubling its sample size. Says one network executive, "They have not kept up with consumer behavior, which has changed pretty dramatically." THR takes a look at some alternative ways of measuring viewer engagement that are gaining traction.
NBCUniversal executives announced in January that CNBC would jettison Nielsen ratings for its business day programming. Instead, Cogent, which long has provided research to financial companies, will track CNBC consumption by investors and financial professionals (its target audience) via weekly web surveys with a sample size of about 1,200. CNBC execs long have complained that Nielsen does not adequately measure the network's out-of-home viewing on trading floors, in offices and at five-star hotels. At the same time, CNBC commands premium CPM rates because of the wealth of its audience. "No one was buying CNBC business day [programming] for the number of adults 25-to-54 that it is reaching," says Mike Rosen, executive vp ad sales at NBCUni's news and Hispanic groups.
RENTRAK TV ESSENTIALS
Oregon-based Rentrak's TV ratings have an impressive sample size — more than 30 million homes — with VOD viewing from more than 117 million. The company's data is derived from anonymized set-top box data via partnerships with service providers including Dish, DirecTV and Charter. But what the Rentrak data cannot do is divine exactly who in the home is watching the television. All the broadcast networks use Rentrak, and Discovery in April reached an agreement with Rentrak and IHS Polk Automotive (which tracks consumers' car-buying histories) to more precisely target and measure consumers.
Clypd is one of many competing television-buying tools that aims to fuse data streams (including surveys and TV ratings) to come up with a mechanism that allows more precise targeting via an automated system for ad buys. "It's very labor intensive to analyze buys on our side and their side and go back and forth and negotiate changes," notes Beth Rockwood, senior vp market resources and ad sales research at Discovery. "The promise of Clypd is that it simplifies all of that."
Nielsen has purchased or partnered with several market research companies in an effort to keep pace with the granular requirements of advertisers. In 2009, Nielsen formed a joint venture with packaged goods market research firm Catalina Marketing. A popular tool used by all the major network groups, it tracks purchases via loyalty shopping cards (think Ralphs or Rite-Aid) and then overlays that with the Nielsen viewing data on an individual level via the Nielsen People Meter data.
NIELSEN BUYER INSIGHTS
This is the same idea behind Nielsen Catalina, but Nielsen Buyer Insights tracks credit and debit card purchases instead. Eighty percent of a person's credit card purchases and 30 percent of debit card buys are matched against the Nielsen TV data to provide a better consumer profile.
The company boasts a database of more than 231 million U.S. consumers' tracking purchases in packaged goods, electronics, apparel, sporting goods and auto. Much like Nielsen Catalina and Nielsen Buyer Insights, the name- and address-based data platform connects shopping choices with media consumption but also layers in behavioral research such as how many exposures are needed to generate a purchase.