Industry Groups Seek to Unify Online, TV Metrics
Internet companies have long been looking for ways to grab more of the TV industry's bounty of ad dollars, and while that has become the perennial struggle, three trade groups on Monday announced an agreement to find new ways to measure audiences across media, specifically comparing TV audiences to online audiences. The idea is that by helping marketers and media buyers compare the two media, they'll be more willing to shift ad dollars from offline media to online.
The Interactive Advertising Bureau (IAB), the Association of National Advertisers (ANA) and the 4A's (the American Association of Advertising Agencies) will work with management consulting firm Bain & Co. and the strategic advisory firm MediaLink to support the initiative.
"The interactive experience has been hard to quantify," IAB Chairman Bob Carrigan said at the group's conference in La Quinta, Calif. "Brand marketers have to feel comfortable shifting dollars from TV to digital -- it's about share shift."
Even though the internet industry has enjoyed steep ad revenue growth, advertisers are still spending significantly more to reach people via TV. In 2010, marketers spent $56.5 billion on broadcast and cable, according to estimates from Zenith Optimedia, while buying just over $23 billion in digital media. Online advertising is expected to grow 53% to $35.4 billion by 2013, and though TV spending will increase only 10% in the same period, it'll still see about $62.5 billion in three years, 76% more than the digital industry.
Mr. Carrigan said the problem stems from the fact that marketers simply don't know how to compare audiences, not only in terms of numbers, but in value. "Clearly, brand marketers are going with what works, and largely because they have established metrics in television," he said. "In the interactive industry, with video being used more often and with social media, how do you quantify that and equate that to the brand experience of television? That's the challenge for the industry." But some industry observers note that making this comparison would lead to inaccuracies. Dave Morgan, CEO and founder of TV ad targeting company Simulmedia, wrote in Ad Age: "Comparing TV spots to web banners to radio ads to newspaper ads is worse than comparing apples to oranges to pears."
The initiative is in its very early stages and there are no specific guidelines for what it is planning to measure or how exactly it will be compared to TV's rating system.
Said ANA President-CEO Bob Liodice in a statement: "It is indeed time for the industry leaders to develop a 'currency' that is widely and consistently accepted and adopted -- online media has an abundance of metrics, but none that serve as currency across the ecosystem."
Nancy Hill, president-CEO of the 4A's, added: "The confusion in this area has added costs to advertising agencies, which have been forced to use, subsidize and staff around increasing numbers of metrics and data in order to plan, purchase and post-analyze their media buys. This initiative will streamline and simplify those processes."