What Advertisers Really Need to Know About Cross-Platform TV Measurement

There's been plenty of noise around cross-platform TV measurement as of late, rising from delays in Nielsen's so-called Total Content Ratings, concerns about its methodology and a potential new currency out of media agency network GroupM. But amid these conversations, the question keeps coming up: What do Total Content Ratings actually mean for the ad industry? The answer is not much. Top agency executives are more interested in getting to a cross-platform rating of commercial impressions than Nielsen's push for all-encompassing program ratings. As their goal comes into sharper focus with WPP-owned GroupM proposing a method to do it (more on that below), some crucial issues must be addressed. The industry must decide how it values ads across platforms, for one, and whether every ad vehicle should be treated the same. "How ad loads play in each environment is an important question," said John Swift, CEO North American investment, Omnicom Media Group. "How do you value audiences on different screens? We have to figure out how much advertising is worth in different environments. The notion of pushing one thing across the board leads us to what I call the lowest common denominator of measurement." It's an understatement to say the road to cross-platform TV measurement has been both messy and confusing. Nielsen has been promising the industry a solution that would account for viewers who have migrated from live TV to delayed viewing on mobile devices, tablets and over-the-top services. It's anyone's guess whether the measurement behemoth will unveil a syndicated product by its proposed date of March 1. But for the ad industry, the delivery of Total Content Ratings in time for the summer's annual upfront haggle is largely irrelevant. That's because Total Content Ratings, or TCR, does not measure viewership of commercials. TCR is essentially a version of existing program ratings, souped up to include the elusive viewing taking place traditional TV schedules and screens. The industry moved away from using program ratings to set guarantees for ad inventory in 2007, when it adopted the currency known as C3, which measures the average viewership of a commercial break in live broadcasts and three days afterward. If TCR can get past concerns over its methodology and the labor required to deploy its technology, it will give networks, and to some extent advertisers, a more complete picture of how TV content is being consumed. It's a step in the right direction, surely, but for marketers it doesn't matter much. "TCR has minimal value to advertisers," said David Campanelli, senior VP-director of national broadcast, Horizon Media. "Right now, it really does little for the advertiser other than to confirm what we already know, that C3 doesn't fully capture 'Modern Family's complete viewership. It gives us insight into behaviors across platforms, but doesn't change the currency or how we are buying yet." For the most part, media agencies have not yet seen the data, which makes it that much harder to analyze if it will have any value to them and their clients. Nielsen had originally said it would make a TCR tool accessible to agencies on Jan. 1. But network executives have pushed back, saying the data is not ready for agencies to use to evaluate budgets as the annual upfront season nears. So instead, Nielsen is allowing networks to cherry pick the data they make available to agencies ahead of the release of a syndicated product. Nielsen had previously said the measurement would be ready in time for last year's upfronts. "TCR is nice to have, but it doesn't solve the problem. It is a step in a longer journey to the answer," Omnicom's Mr. Swift said. "TCR isn't anything more than validation and to get an idea of the audience," said Rino Scanzoni, executive chairman and CEO of GroupM's addressable TV group Modi Media and barter group Midas Exchange. "TCR was not intended to be used in any sort of transactional way. Even planning is hard because it includes content that may or may not have commercials." As more people watch TV shows on a delayed basis and on a variety of devices, the industry has been clamoring for Nielsen to deliver a syndicated measurement that paints a more complete picture of how audiences are consuming content on all screens. The change in viewing patterns has led to audience fragmentation and a precipitous decline in live-plus-same-day ratings. But network executives argue people aren't watching less TV, they are just watching in ways Nielsen isn't currently measuring. With TCR, network executives are hoping to find those "lost" viewers and in turn sell them to advertisers. While TCR surely has plenty of value for the networks as a way to better understand their audiences, make programming decisions and assess the platforms that buy their shows in syndication, for agencies and their clients the implications are less clear. TCR can be used as a planning tool to glean insight into how marketers should be allocating budgets. But even using it for that purpose is limited. TCR measures content whether or not it has an ad attached to it. This means ratings for some content may be inflated compared with the impressions the network can actually sell to advertisers, according to several network and agency executives. Nielsen agrees TCR was never intended as a currency. "It has nothing to do with the ad model," said Megan Clarken, president-product leadership, Nielsen. Rather it is a tool for networks to tell a comprehensive story to advertisers, providing both networks and agencies more transparency, she said. "TCR is interesting to look at to measure the potential of content, but has no practical value in media planning and buying," said Lyle Schwartz, president-investment, GroupM. That's where GroupM, the largest buyer of TV commercial time, comes in. The media agency is developing a commercial measurement methodology that promises to quantify ad viewership across all platforms and devices. GroupM previously led the charge to replace program ratings with commercial ratings as the basis for TV ad sales. GroupM's proposed methodology measures commercial viewership within long-form TV content across platforms over seven days, so long as the commercials remain consistent, Mr. Scanzoni said. That means, for example, that an advertiser can't replace an ad that ran in the live broadcast with another one for video on demand in those seven days -- not if it's going to be included in the commercial rating. It also means a network can't show fewer ads in its digital streams for that first week if it wants credit for the commercial impressions generated. To be clear, the ad load does not have to be the same on every network; Fox doesn't need to have the same number of commercials as CBS for the proposed system to work. But if Fox airs 10 minutes of commercials in an episode of "Empire," those same 10 minutes must run untouched on every platform where people watch it. There is an exception in the methodology for Hulu. Because the streaming subscription service has an established lower commercial load than linear TV, GroupM has come up with a way to measure ads that run there by negotiating a "fair rotation of commercials," Mr. Schwartz said. While similar exceptions could be applied to other platforms that do not have a comparable commercial load, Mr. Scanzoni said there can't be 5 or 10 of these exceptions because it would create complications. GroupM's solution would also create on open standard that would allow multiple measurement parties, not just Nielsen, to supply ratings. The technology to do this is already available at both Nielsen and ComScore, Mr. Schwartz said. But it will require a significant amount of labor on the network side to encode the ads, much as they must put in the work to tag content for Nielsen's TCR. GroupM is working with one undisclosed network, along with the TV industry's Video Advertising Bureau, and could do a limited amount of deals tied to the proposed measurements as soon as this year's upfronts. But nothing is expected to change overnight. "This won't likely happen all at once," Mr. Scanzoni said. "A couple of networks can decide they want to move forward. It is an evolutionary process rather than a situation where everyone agrees to move to this metric at this date." For some, GroupM's method is intuitive and a relatively neat solution to something the industry has been grappling with for some time. Both network executives and executives at competing agencies acknowledge there is a lot that works in GroupM's methodology. Still, GroupM's proposal would require advertisers to buy commercial inventory on a C7 basis, which looks at commercial viewing in the seven-day window. Converting to C7 has been a slog, partly because some advertisers, especially those whose messaging is particularly time-sensitive, like movie studios or retailers, don't want to pay for audiences outside the windows for which their messages are intended. But Mr. Scanzoni said the industry is well on its way to converting to C7 and that there are ways to work out the economics for those marketers. While one an executive at one network said it could have it up and running by May or June, there is some hesitation to do so. Networks are concerned that they would go through the tagging process only to see another approach arrive and become the standard. "It is too costly to get everything up and running for GroupM's version now and then change it if something else comes along," the executive said. "So we are taking a wait and see approach." Beyond the logistical concerns, there is a much larger debate: whether or not it is in the best interest of marketers and networks, as well as consumers, to adopt a currency where the ad loads must remain the same on every platform over a seven-day window. "Whatever we do as an industry needs to start with the consumer," Omnicom's Mr. Swift said. "Just because it works for TV doesn't mean it works for everything else." At a time when networks are looking to improve the consumer experience, more linear TV is being delivered through internet-enabled devices that can generate and use data to more precisely target viewrs. Running traditional TV's commercials on a network app, for example, seems to some like a step in the wrong direction. "I applaud the idea to capture the big picture," one media buyer said. "But having to retain the full commercial load across seven days, that's not what digital is about. The same commercial load shouldn't air across platforms. It's a blunt tool to get at a nuanced challenge. I don't think the execution is the right one but bringing the concept to the table is right." "We're not sure if there is ever going to be a cross-platform currency whereby an ad runs in-show on the linear platform and the ad runs in the same way on digital platforms like DirecTV Now," said Howard Shimmel, chief research officer, Turner. "I'm not sure if the market will agree to aggregate the audience and sell me in that way. You would lose the precision that some platforms provide for us." Mr. Scanzoni contends that adopting a C7 cross-platform metric won't take away those more data-driven digital opportunities. Networks can continue to make innovations in their ad loads beyond the seven-day window. And a network can always choose to exclude a particular show or episode if it decides to experiment with the ad format; that only means that the associated commercial impressions wouldn't show up in the new measurements. While Mr. Scanzoni said he is a big proponent of addressable and advanced advertising, moreover, he also argued that using TV to build brand awareness remains important. GroupM's methodology could also give an opportunity for platforms like Facebook and Twitter, which are beginning to carry more long-form, episodic video content, to actually get measured in the same way as CBS and ABC, Mr. Schwartz said. "We would finally be able to analyze them apples-to-apples," he said. Of course, having Facebook and Twitter carry the same commercial load as linear TV is a big "if." More feasibly, GroupM's measurement could help drive down the cost to reach 1,000 viewers, an industry standard known as CPMs, or at least temper the forces currently pushing prices up. Shrinking audiences has driven ad rates up for the remaining inventory. Relocating lost viewers could have the opposite effect. "We know it will increase supply," Mr. Scanzoni said, "so it should help manage CPM increases." The same dynamic could also help TV networks actually reduce commercial loads, according to Mr. Scanzoni. As networks have sought to reduce the amount of ad time confronting viewers, they've had to try to convince marketers to pay more for the benefit of a less cluttered environment. In order for it to make economic sense for a network to remove some commercials, they need to raise the price of the ads that are left. Mr. Scanzoni contends that if the industry can increase its ratings by adding in cross-platform viewing, networks can eliminate some commercials without raising prices. While GroupM had originally supported Nielsen's TCR as a stepping-stone toward a new currency, delays in the product launch led it to bypass the pending metric, Mr. Scanzoni said. It remains to be seen if GroupM's proposal will become the new standard currency. That's if the industry opts for a new single currency at all. That's an increasingly lively question as networks and advertisers talk more about about driving outcomes and measuring ROI, as opposed to looking only at ratings, and as networks bypass Nielsen completely to make audience guarantees using a combination of proprietary and third-party data. At least one thing is certain: The decision is a much more complicated one then when GroupM led the charge to commercial ratings a decade ago.

What Advertisers Really Need to Know About Cross-Platform TV Measurement

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