OPINION31 March 2022

When worlds collide: The dilemmas for Nielsen

M&A North America Opinion

Nielsen has accepted a $16bn takeover from a private equity consortium. What does the deal mean for the company and the measurement industry? By Tony Jarvis.

TV

Based on substantial, renewed and technologically advanced competition in TV/video audience measurement and its new ownership, Nielsen, as the platform’s wonky incumbent currency, has a unique opportunity to re-establish its position as the universal basic TV/video ratings currency in the US and adding streaming and connected television (CTV).

This suggested status is underpinned by its recent loss of Media Rating Council’s (MRC’s) accreditation which, however, it is strenuously addressing.

The ‘new’ Nielsen company faces continuing complex measurement/data integration and technology challenges with both devices and survey sampling of the entire population. This is in addition to the increasingly diverse metrics requirements of planners, buyers, and sellers.

Which measure should be established as the universal base currency (accredited by MRC)? Should this provider have a virtual currency monopoly as Nielsen has had for many years, or should the US finally embrace the Joint Industry Committee (JIC) concept for TV/video, streaming and CTV people-based ratings measurement? What ancillary ‘higher value’ metrics, if any, should be available and integrated with the base currency by the universal currency provider?

Or should such enhancements be strictly the privilege of all other research vendors in the arena? Can the industry agree on even the definitions and derivation of key media metric terms, and will MRC concur via its audience measurement standards?

Unbelievably a current burning question in the US, with a wide variety of answers is, ‘define an impression?’

Unlike Europe, JICs do not exist in the US, although, contrary to some misguided beliefs, are quite legal here. Media currencies are established by independent companies not industry tri-partite consortiums. Consequently, MRC accreditation to achieve minimal research quality standards is fundamental to the validity and ultimate survival of media measurement services which all operate as independent for-profit operations.

Nielsen will move from being publicly traded to private, which raises any number of other issues for an industry currency provider.

Nielsen clients have long complained, I believe correctly, about the quality, cost, services offered, and the mindsets of Nielsen’s senior executives. However, although considered substantially insufficient to provide meaningful persons ratings programme by programme across the current massively fragmented TV/video streaming US population, Nielsen does survey more than 40,000 households or roughly 100,000 people 365 days a year using a relatively sophisticated people meter. No mean feat.

In addition, self-reported metrics from any media ad seller is simply unacceptable. Those days should be long over along with using distribution or circulation rather than persons-based measurement to drive ratings and brand effects.

Despite the extreme measurement complexities and massive costs, the industry needs a universally accepted, independent third party to provide programme ratings at multiple levels of geography and consumer profiles based on an audience-based opportunity-to-see (OTS) at a minimum.

This traditional base measure is critical to brand advertisers and their agencies who may wish to use ancillary research data to calibrate or model watching, contact, or ‘eyes-on’ adjustments, or even attention findings to convert the audience-based OTS persons metrics to more meaningful levels.

There is ample evidence that these converted or enhanced value media metrics are significantly more co-related to campaign outcomes than mere OTS demo counts. However, the industry is unlikely to make the massive investment required for universal programme ratings based on either actual persons watching/eyes-on or attention.

In an attempt to isolate a universal metric to compare TV/video, streaming and social media platforms, including all devices used for distribution or circulation, the US industry has moved to embracing the most basic and fundamental media metric – the so-called ‘viewable impressions’ per MRC, often simply referred to as impressions, or more correctly ‘content rendered counts’.

But beware. These measures are unequivocally and solely device/screen measures of content properly rendered if MRC accredited. Nothing to do with people, or audience, or watching measurements, nor even their presence or lack thereof associated with the screen.

Consequently, such impressions or screen/device measures offer no indication of the real potential of people seeing or hearing the program content or advertisements.

Viewable impressions are not a persons-based audience OTS measure which surely the industry needs as a minimal universal comparative metric for media planning or buying across all media. Measuring whether content has been rendered to specifications on a device or screen is fundamental for billing and paying and makegoods. No more. No less.

The new Nielsen faces intermingled, conflicting issues and concerns from every corner of the industry plus winning back MRC accreditation. If they come close to solving them, maybe it was worth $16bn.

Tony Jarvis is a proprietor/research architect at Olympic Media Consultancy in the US. He is a former board director of the Advertising Research Foundation and Media Rating Council.

1 Comment

5 months ago

Spot on Tony. Australia also utilises a JIC, and it works very well. The discussion about 'impressions' is also extremely relevant - what sort of threshold duration is likely to produce an 'impression' in the viewer.

Like Report