Broadcast Prime Highest ROI, Nielsen Undercounting as Much as 20% — Bill Harvey
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- October 22nd, 2014
As part of Advertising Week in New York, the five big broadcast TV networks gathered the top buyers together with Hollywood producers and creatives on October 2. CBS Chief Research Officer David Poltrack had invited me to his table with Gayle Fuguitt, CEO of ARF, Poltrack’s ace wingman Greg Kasparian, and the estimable Leslie Wood. Kicked off by CBS President of Network Sales Jo Ann Ross, the top five television networks put on a classy show, showcasing the quality of their content and its key role in the future, present and past of television.
In a panel of the top network researchers, Poltrack cited the body of ROI work he has done with TiVo Research/TRA and Nielsen Catalina, proving that the quality of programming has an extra engagement effect that increases ROI of broadcast prime over other networks and dayparts, more than overcoming its higher CPM. Several people excitedly remarked to me about ARF’s plans to do a third Adworks study. The pace of ROI since TiVo Research/TRA’s introduction of sustainable singlesource continues to accelerate. Once Adworks III is published, the shift of dollars back into broadcast prime is almost a confident prediction. The October 9 announcement of Rentrak acquiring Kantar’s singlesource division further substantiates the seismic shift toward ROI replacing CPM as the ultimate metric in making TV advertising decisions.
Poltrack reported a large CBS study of all CPG brands spending over $10,000,000/year in network television, which found that in 2000, the percent of dollars allocated to broadcast prime had been 40%. By 2014 this has dropped to 22%. Yet ARF’s landmark Adworks II study, based on more than 400 different brands’ BehaviorScan tests, showed that the optimal percentage of broadcast prime was about half the total TV dollars; the latter allocation produced the highest ROI. So the trend has actually been going in the wrong direction.
In the same panel NBCU’s Alan Wurtzel, one of the founders of CIMM, called attention to the suspicious drop in Nielsen ratings among 18-24, 25-34 and 45-54 adults, despite their increase in hours/day of viewing, and provided evidence that Over-The-Top (OTT, viewing of Internet streams on the TV set) could more than account for this apparent drop, since “Nielsen has no current plans to measure OTT.” Wurtzel showed pie charts for several top shows, on NBC and other networks, indicating that the missing OTT audience frequently exceeds 20%. He also pointed out that the OTT landscape is balkanized based on which device is being used, and that it is a complex measurement problem to address, with for example Roku’s 10,000,000 homes now using as much NBCU streaming content as all 200,000,000 users of YouTube. From our own work, we have seen that OTT measurement in fact requires solving for more than two dozen different devices.
“The metrics are beginning to fail us,” he said.
Several speakers called attention to the ever-larger proportions of audience being undercounted by Nielsen based either on methodology gaps, or on conventions such as C3 or even C7. CBS Executive Vice President and General Manager–Entertainment, News & Sports, CBS Interactive Marc DeBevoise called for C30 as a more relevant measure — in other words counting audiences that watch an episode after the first seven days of its shelf life. In fact this year the first C7 deals were actually made, and the trend appears to be toward accepting that the viewing window has not stopped lengthening and longer basis periods will be needed.
DeBevoise also revealed that special video content had been created by the actual series writers and producers and run on second screen in sync apps for 11 CBS shows last season. We see this as a very positive trend and one which we predicted and recommended. Symphony Advanced Media (“SAM”) reports that mobiletasking (attending to another screen device while watching TV) is now up to 40% during the average primetime ad pod.
As Poltrack asked, Why not use that extra opportunity to engage?
SAM uses passive panel measurement and proprietary methods to attribute mobiletasking and to identify the types of mobiletasking that increase versus decrease TV commercial recall and other success measures. This type of information generates non-obvious and relevant findings we have reported .
NBCU reported having created 10 comedic short programs with Audi; use of crowdsourcing for comedic talent (of 3000 submissions, two will be on TV in summer 2015 and a third will launch on digital), and using “social sync apps” for “The Voice.” These are all forms of custom content, which is becoming an enlarging sphere within all video production, as predicted and recommended here and elsewhere.
IAB defines a viewable impression as “at least 50% of the ad being on screen for at least 2 continuous seconds.” Matt Timothy, President of Vindico, which serves the largest chunk of the big-five streaming inventory, reported that this inventory averages 65% viewability vs. 45% for Internet branded digital video and vs. 37% of ad network/exchange inventory. Overall average weighted by volume is 45%.
He also reported that bot activity averages 10% of all impressions in digital video served but is only 2% for the 5 big networks. For Internet brand publishers it is 7% and it is 14% for ad networks and exchanges.
Other Interesting Data Points
Linda Yaccarino, NBCU President of Sales, interviewed David Bank, Managing Director, Equity Research, RBC Capital Markets. Bank had counted up the substitutable impressions of digital video in relation to mainstream TV and found that the entire digital video impressions five-network market was “about the size of one new episode of ‘Big Bang.’”
Eileen Heisler, creator/executive producer of ABC’s “The Middle,” mentioned that her show makes 24 episodes a year vs. 22 for a strong procedural vs. 12-15 for a “big drama.”
It has now become commonplace for a show’s writers to watch and respond to Twitter and Facebook feeds during the main airing, something I had recommended to network clients years ago.
Several people including Yaccarino expressed consternation and the incomprehensibility of why Digital Ad Insertion is not rolling out faster. DAI of course provides TV with Internet-style targetability and measurability, and can be enhanced with interactivity. We began beating those three DAI drums in the 90s, so we can easily empathize.
Dana Walden, Chairman/CEO of Fox Television Group, said that she picks up new series based on (1) their creative talents’ combined “voice,” (2) they have “something to say” and (3) their being passionate about it. Note that people doing their passion work operate in the Flow state.
Audrey Steele, Senior Vice President, Sales Research and Marketing of Fox Broadcasting Company, emphasized the importance of environment on commercial effectiveness, calling for more research there.
Geri Wang, President, ABC Sales, said “We’ve got to invest more in measurement.”
Bill Harvey is a well-known media researcher and inventor who co-founded TRA, Inc. and is its
Strategic Advisor. His nonprofit Human Effectiveness Institute runs his weekly blog on consciousness optimization. Bill can be contacted at firstname.lastname@example.orgRead all Bill’s MediaBizBloggers commentaries at In Terms of ROI.
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