IAG has gained notice in recent years, having signed pacts with many of Nielsen's biggest TV-network clients. In 2006, NBC signed a deal with Toyota that required the network to use data from IAG Research to demonstrate its viewers paid attention and could recall particular details about a TV show. At a time when more advertisers are pressing for detailed examinations of whether their ads change consumer recall, intent and purchase behavior, a purchase of IAG would layer some qualitative data atop Nielsen's expertise in measuring more quantitative elements, such as reach and frequency.
"We are known for our quantitative data, but more and more advertisers are looking for ways to differentiate their ad campaigns," said Susan D. Whiting, the Nielsen Co. exec VP who oversees development. At such a time, she added, "additional analytics are very important."
Though Nielsen has been on a shopping spree of late, buying up firms that help it measure all kinds of new data, the firm faces a big challenge: How does it retain its dominance at a time when just knowing how many people watched a TV program is only one piece of data in a much bigger field? Nielsen has made clear its intent to find ways to measure consumers' behavior, whether they receive video information and entertainment on TV, via the computer or by mobile devices.
An IAG acquisition would also give Nielsen more direct access to advertisers themselves -- and additional insight into what they want and need. "While advertisers strive to figure out how to reach their own consumers in a fragmented universe, it has caused them to take a very direct role over the last several years in evaluating different sorts of data and business solutions," said Alan Gould, co-CEO of IAG. "That's just a reality."
In May of 2006, two venture-capital firms invested a total of $47.5 million for more than 50% of IAG Research. At the time, the company planned to use the money raised from Insight Venture Partners and Bessemer Venture Partners to expand its research to commercials that run in emerging-media venues such as video on demand and mobile devices.
Nielsen has been talking with IAG executives about a potential acquisition for about a year, according to the company. The deal is expected to close in the second quarter, and IAG's executive team will join Nielsen after the pact closes.