The ratings service is scheduled to take its road show to New York this week for a presentation before the TV advertising committee of the Association of National Advertisers. Nielsen has already presented to stations in New York, Los Angeles, Chicago, San Francisco, Philadelphia and Boston, among other markets.
Nielsen has also talked with key advertisers, including Procter & Gamble Co.
The 45-member ANA TV Advertising Committee includes executives from other leading marketers, including AT&T Corp., Colgate-Palmolive Co., General Motors Corp., Pepsi-Cola Co. and Unilever.
WHO WILL PAY FOR IT?
Though the main issues of who will bear the cost of installation of the people meters and how much Nielsen will charge for its service are skirted in the presentations, the informational plans discussed by Nielsen include various rollout scenarios.
"They're trying to decide if they want to roll it out in one major market, the top three, top 10 or perhaps by region," said one executive familiar with the presentation. Nielsen declined comment.
People meters -- electronic devices that resemble TV remote controls -- gather demographic data and are considered a far more accurate measurement system than the diaries currently filled out by viewers to track local viewing. Nielsen now uses people meters to track information for its national viewing reports.
"People meters legitimatize the data," said Howard Nass, executive director of local broadcast for TN Media, New York.
Plans discussed by Nielsen call for sample sizes of 500 to 1,000 households, depending on the market. But although interest in local people meters is heating up, fueled in part by the recent enthusiasm of some multiple-system cable operators, Nielsen faces an uphill battle.
"Since most of our stations are not affiliated with the four major networks, my sales guys generally are in favor of people meters, because they don't think we're getting due credit for certain shows in the diaries," said an executive with one major station group.
"But the financial guys are dead set against paying any additional monies to Nielsen," the executive added.
COST VS. REVENUE
What those stations have to weigh, Mr. Nass said, is "How much more revenue am I going to generate, and how does that compare with the price [I'll be paying] to Nielsen?"
A new position paper by Starcom Media Services, Chicago, notes that data from people meters would require stations to develop new systems to handle the data properly, an expense many stations don't want to incur. Another disincentive for stations is that cable viewing historically goes up in people meter measurements at the expense of broadcast.
But Starcom has identified seven reasons why, in large markets, the benefits to stations outweigh the drawbacks for switching to local people meters. With people meters, Starcom notes, stations can: back off from sweeps promotions; gain more credibility with advertisers; compete for national TV dollars on a level playing field; improve accountability; acquire the potential to optimize inventory; receive timely demographic information; and gain more sophisticated tools for tasks such as tracking viewer retention week to week.
NEW YORK ALONE
Starcom also noted people meters are used in Canada, Hong Kong and Indonesia, markets where TV ad spending equals or is less than the $1.5 billion spent on spot TV in New York City alone.
"Given the amount of money at stake, the local TV station excuse that it's going to cost too much for people meters just doesn't fly with advertisers