Nielsen’s TV ratings mess could be a tipping point in his dominance

This reversal led the MRC to request the simulation of the effect of the Nielsen pandemic workarounds on its data. Ultimately, it ended weeks of “denial, delay and diversion,” Cunningham says.

There remain unanswered questions, such as why Nielsen showed declines even in TV streaming among adults aged 18 to 34 for the six months ended in February compared to the period a year earlier. Cunningham says it’s “unlike four other sources, including our member companies, which had some of the biggest streaming services.”

The VAB says the monthly Nielsen panel size increased from 39,600 households in February 2020 to 29,500 in February 2021, and that the latter number included the 9,400 “disabled” households that Nielsen just started visiting in late March. In fact, it could have halved the number of households actually providing reliable data – at a time when it takes more people than ever to accurately count the number of viewers in an increasingly fragmented television market.

Nielsen cites somewhat different numbers, with around 47,200 homes in February 2020, up from 37,900 currently. And Mazumdar says that while 9,400 homes have been identified as needing maintenance, Nielsen doesn’t find any issues with all of the homes.

Decline of black and Hispanic homes

Of particular concern to the networks was the loss of black and Hispanic households from Nielsen’s sample. According to the VAB, black houses in Nielsen’s sample fell 28%, while Hispanic houses fell 23% and white houses by 18%.

Nielsen weights the data for the remaining households to compensate for these discrepancies, so it always reports numbers for a representative sample of the United States, Mazumdar says. But Cummingham says that means an unreasonably high weight given to each minority household, increasing the margin for error.

This is particularly problematic since networks that specifically target these audiences already come from a place where they must demonstrate the relevance and power of the African American audience, says an advertising sales manager for the network.

Nielsen’s problems with black and Hispanic audiences are not new, says Louis Carr, president of media sales at BET Networks. “It has been an ongoing problem. There are not enough meters in the houses, maintenance issues and everything is done in a timely manner. I have had these conversations for decades.

“The problem is, when you have such a small sample and things go wrong, it gets amplified,” Carr adds. Before COVID, Carr estimates that a Nielsen household had an impact of about 2% on BET ratings. With around 9,400 homes “disabled” during COVID, Carr says each home has had up to 25% of an impact.

Carr points out the BET rewards, which often trending on Twitter for several hours, but that social chatter is not reflected in the ratings. “This is obviously not an individual comparison, but you would expect it to be very different from some of the results of the assessments,” he says.

“We still have a pretty well defined process when it comes to weighting,” says Nielsen’s Mazumdar. “It is agreed with the MRC.”

Nielsen worked with the MRC because COVID is also affecting the mixing of his sample, he says. “If you take all of this information collectively, we felt, and we continue to support the data and the weighting that represents what’s going on in the market. We do everything we can to ensure that the sample is representative. “

A real change to come?

While snipers between the networks and Nielsen over the quality of TV ratings have been rife for decades, the intensity of current complaints and the growth of alternatives are among reasons to believe that a real threat to Nielsen’s monopoly is emerging.

“We’ve never had an industry before that has as much growth and promise as you have in datasets and census panels in the millions, not the thousands,” says VAB’s Cunningham. “There is not a market or a sector which is not helped by healthy competition.”

Nielsen has its own game of cross-platform multimedia video measurement using a multi-million panel under the moniker Nielsen One, which CEO David Kenny said last week could likely become a key currency for advertising deals. on TV and streaming by next year. Certainly, Nielsen’s assessment against one of these competitors – Comscore – suggests that investors are betting on Nielsen.

But this latest fall on legacy linear TV ratings may not inspire confidence in Nielsen’s ability to accurately measure an even larger and more complex video universe.

“Networks are all looking for alternatives,” says Jane Clarke, CEO of the Coalition for Innovation in Media Measurement, an industry group formed 12 years ago to develop improvements in a space dominated by Nielsen. “Each of them creates their own unique measurement approach. There are groups that create proprietary group approaches. It’s so fragmented that I think there will eventually be a consortium between the networks. And if anything, this thing with Nielsen makes them speed it up.

She cites Comscore, VideoAmp and Oracle Data Cloud as the main third-party alternatives to Nielsen. Emerging panel providers, who could help provide person-level estimates in these large household datasets, are “significantly cheaper” than Nielsen, Clarke says, “but not yet perfect.”

Clarke says one of the major media companies told her over a year ago that she had only entered into a three-year contract with Nielsen while planning to develop a new alternative to operate in parallel. for a year before trying to make a change. Virtually all of the major networks initially go out and say they will have multiple valuations or currency alternatives, she says.

ViacomCBS plans to offer guarantees against Nielsen or Comscore data, John Halley, chief operating officer of ad revenue and executive vice president of advanced marketing solutions, said at the CIMM summit in February.

“The big problem with moving away from Nielsen is that it’s such a big number in every media company’s budget,” Clarke says. “And these new panels are struggling to secure funding during this interim period. You have to put on another panel for a year or two – and keep paying Nielsen during that time – and it always crumbles because no one has the money. But the four major networks are the closest to doing so. “

A similar reluctance on the part of marketers, she says, makes it harder for the Association of National Advertisers as it tries to mount a new cross-media measurement pilot. “They all think the networks should pay,” says Clarke. The ANA declined to comment.

But Nielsen’s competitors certainly see an opening. “This decline [in total TV viewership] and then it suddenly comes back, that’s exactly what a currency shouldn’t be, ”says Carol Hinnant, Chief Revenue Officer of Comscore. “Small panels are just not reliable anymore.”

VideoAmp’s director of measurability Josh Chasin is more charitable to Nielsen, saying he believes the company has done its best to maintain the quality of the panel during the pandemic. But he says the episode highlights the negative side of the panel’s measurement.

“Buyers and sellers are going to be very concerned about the disappearance of all the currency they rely on, which will be disrupted, and that clearly opens the door for other players as the legacy advantage wears off,” Chasin says. “What we’re hearing from both the buyers and sellers side is that they want an alternate source of data in place.

“Everyone recognizes that the ubiquity of datasets that can be used as currency means that Nielsen’s monopoly is coming to an end,” he says.

Skepticism on the buy side

Ultimately, any measure alternative networks take must get the consent of agencies and clients – and that will always be a tough sell.

“Agencies think networks laugh and complain, and they do it all the time and just want to undermine the numbers before they take action,” says Clarke. “And some underlying trends are real. Linear television is out of order. “

“The networks are really taking positions on this,” says Cathy Shaffner, investment manager at independent media store Empower. “They use it to get the double-digit increases they’re looking for right off the bat. There was probably a little less dip [than Nielsen estimated], but there really was a dip.

Shaffner says she also doubts the networks are ready to leave Nielsen. “The fact that they are able to complain and have that independent opinion and change the numbers before they leave means that they are always a little more connected to Nielsen than they want to be,” she said. .

Still, Shaffner says that with networks demanding that 20% to 30% of initial purchases this year be in digital properties, this may be “the push Nielsen needs to get their measure” of smart TV alternatives in place, “Or they’re going to be obsolete.” ”

Another media agency executive, who asked not to be identified, said many buyers remain reluctant to accept Nielsen currency alternatives, regardless of the current controversy. “Clients love their annual metrics, and until they gain a new vision of efficiency and results, there will always be resistance from conservative voices on the agency’s buy side and from clients. . There will be a CTV tipping point, but not yet, and Nielsen must try to manage that transition and hold his position. “

How is the television industry reacting to the streaming wars? On May 24-25, listen to ad sales executives, agency executives and major brands talk about the state of the TV advertising market and how streaming is about to reinvent the original market for $ 20 billion. RSVP here.

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