NEWS18 November 2008

Nielsen scoops Cumulus contract to enter US radio ratings market

Arbitron blasts ‘step backward’ as ratings heavyweights square up

US— Nielsen has taken its first steps into the US radio measurement market after being selected as radio station owner Cumulus Media’s “ratings partner” in 50 small and medium-sized markets.

The move brings Nielsen into direct competition with radio currency provider Arbitron in the regions, all of which are outside the country’s top 100 radio markets.

Cumulus invited proposals from measurement firms in April when it ended its subscription to Arbitron’s diary-based reports service in the markets, claiming the areas needed “richer surveys in place”.

The broadcaster’s CEO Lew Dickey said: “We couldn’t be more pleased with the outcome. Nielsen is the gold standard for television advertisers who make nearly $80 billion worth of decisions in the US based on Nielsen data. This is a great development for radio.”

Rival radio station owner Clear Channel will subscribe to the service in 17 of the 50 new Nielsen markets, which will use sticker diaries to gauge audience size.

Nielsen will address Cumulus’s previous concerns about “small samples with heavy weighting” by using address-based sampling to reach the 34% of US households not covered by other sampling methods and introducing an online e-diary in 2010. The firm will also make a “significant investment” in incentives to increase representation among hard-to-reach demographics.

Sample sizes will be increased to reduce relative error and bounce and as a result measurement will be once a year, as opposed to Arbitron’s twice-yearly survey. A Nielsen spokesman told Research that this method “will be more accurate less frequently instead of less accurate more frequently”.

Cumulus general manager Bill Whelan said: “The new ratings will be better. With a much larger sample, there will be about 30% less error associated with any particular estimate. We also expect to have a much more representative in-tab in the younger demos that get over-weighted today and often cause large swings in 18-34 listening.”

However Arbitron was quick to attack the deal and CEO Steve Morris said: “Once-a-year measurement is a step backward. Advertisers have told us that radio markets need more than a once-a-year survey in orders for stations to maintain accountability.”

The firm – which submitted a proposal to Cumulus – is in the process of adding cell phone-only homes to its panels in the markets, redirecting cash incentives from older to younger respondents, adding qualitative questions to diaries and speeding up the introduction of electronic and online alternatives to paper diaries.

Author: James Verrinder

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Broadcasters pile pressure on Arbitron