NEW YORK (AdAge.com) -- The 4A's has written a blistering letter to Nielsen, the media measurement firm, over a decision to change the metric upon which ad deals for local TV ads are transacted.
Since late June, Nielsen has been exploring ways to improve the rating of local-TV broadcasts to take into account viewers who watch shows minutes or days later with a digital video recorder. Unlike national TV networks, which make use of commercial ratings, known as C3, that measure what portion of viewers do not skip past advertising, local TV outlets are not judged in a similar way due to several technical glitches that make doing so difficult. So local TV is still judged on program ratings, not how many people watch the advertising.
Earlier this month, Nielsen disclosed that it would soon substitute a "live-plus-same-day" measurement for local viewership, replacing the traditional "live" metric, to take into account viewers who watch specific programs either live or within 24 hours of their airing. The decision has raised vehement objections from several top media-buying executives.
"Nielsen can publish whatever new forms of data it desires. However, you must restore the 'live' stream which you have elected to eliminate as a buying option for the media community," wrote Marc Goldstein, chairman of the Media Policy Committee of the American Association of Advertising Agencies, in a letter to Nielsen Media Research Chairman Susan Whiting that was reviewed by Advertising Age. "We ask that you get out of the way of the negotiating process and let buyers and sellers operate on a free market basis."
Mr. Goldstein is also president-CEO of the North American operations of WPP's Group M.
In an interview yesterday before the 4A's letter came to light, Sara Erichson, Nielsen's president-media client services, North America, said Nielsen took pains to hear the concerns of all sides involved, but that in the end, penetration of DVRs is quickly changing the ways in which viewers watch programs. "The contrasts are really extreme," she said. "If you show programs side-by-side, they'll look the same in terms of who they reach and how many they reach on live, but then they'll look very different by age, by income and by total number of people reached if you go by playback."
A Nielsen spokesperson declined to comment on the letter, which it received this morning.
Nielsen is slated to change over to "live-plus-same-day" measurement of local TV viewing starting in January 2010, and said it would still make live data available to those clients who want it. Buyers argue that the data would now have to be customized, which could raise the fees they pay the measurement company.
TV stations and their owners are likely to applaud the move. "DVR penetration is growing, and it's going to continue to grow, and those live ratings are going to continue to be less meaningful," said Susan Cuccinello, senior VP-research, Television Bureau of Advertising, a trade organization that represents station owners. "I believe 20% of playback is occurring in the first five minutes, 42% in the first hour. That's valuable viewership, and we feel advertisers and agencies should consider giving us credit for that."
Top ad-buying executives, however, believe the move takes away their ability to measure the best viewers possible: people watching TV shows live, who are likely not skipping past the ads.
'The true audience'
"We have been huge advocates of live and believe it is the closest measurement that exists to commercial ratings," said John Muszynski, chief investment officer of SMGX, part of Publicis Groupe's Starcom MediaVest Group.
"I know the TV stations want [live-plus-same-day]. It gives them a bigger number, which means their prices go up. But it's not a more accurate representation of what the true audience is behind the commercials," he added. By implementing the new measurement, he said, "you're basically forcing us to look for ways to revalue the marketplace."
Another media buying executive spoke in even stronger terms. "If we went from live to live-plus-same-day, which is what Nielsen is proposing to replace the live stream with in prime time, [for] the first couple of weeks of the season, the ratings would go up about 13%. But we know of that 13%, 60% to 70% of it is time-skipped," said Rino Scanzoni, chief investment officer at GroupM. "Our clients would be paying for program exposures that are not generating commercial exposure."
Mr. Scanzoni suggested further action against Nielsen could be possible.
The dust-up between buyers, sellers and Nielsen is indicative of the confusion resulting in the ad industry as marketers and agencies try to get more precise detail on how consumers are interacting with media in an era of fast-developing technology. Media executives and ad buyers both suggest that current measurement techniques are not granular enough for advertisers, who have become less interested in the sprawling masses that watch entertainment and more focused on specific subsets of viewers who demonstrate more obvious interest with programs and the ads that support them -- particularly as the web makes tracking audience response easier than TV does.
This burgeoning fracas also comes as local TV stations, often heavily dependent on auto advertising, have been savaged by the recent economic malaise as well as competing digital media that woo away viewers and advertisers.
Read the full text of the 4A's letter to Nielsen:
November 18, 2009
Ms. Susan Whiting
Nielsen Media Research
New York, New York 10003
Dear Ms. Whiting:
As the Chairman of the 4A's Media Policy Committee, and on behalf of members of the association's Local TV / Radio and Media Research Committees, I want to express my absolute displeasure and disappointment with your recent decision regarding local broadcast ratings.
Your total disregard for the expressed concerns of local broadcast media buyers, coupled with your adamant refusal to recognize our point of view is totally unacceptable. Rather than maintain Nielsen's traditional role as an "honest broker" of data and information, you have instead chosen to insert yourselves in the buy/sell process and in so doing you have sacrificed your credibility.
We do not quibble with your desire or the local stations' desire to publish "live + same day" data. This is not about the acceptance of new technologies or the inclusion of time-shifted viewing. It's about your corresponding decision to eliminate a stream of ratings desired by the buying community that places you at the center of a dialogue between those two parties. Simply put, you do not belong there. This is a debate between media buyers and sellers concerning which data stream are used in negotiations. Nielsen is supposed to be a disinterested third party who provides data to fuel the debate. But Nielsen has now taken sides and in so doing your objectivity and perception in the marketplace has been sullied.
As I said, Nielsen can publish whatever new forms of data it desires. However, you must restore the "live" stream which you have elected to eliminate as a buying option for the media community.
We ask that you get out of the way of the negotiating process and let buyers and sellers operate on a free market basis.
President and CEO, N.A., Group M and Chair, 4A's Media Policy Committee