Better Local Ratings On The Way, Really

Broadcasters relying on Nielsen’s antiquated and maligned diary ratings system were encouraged when Steve Hasker spoke at the annual TVB Forward conference in September 2011.

He told the assembled group of sales and ad agency executives that his company was “very bullish” about making the diaries and Nielsen’s other local TV measurements more accurate by enhancing them with set-top box viewership data from cable and satellite operators.

That was welcome news from a man who was president of media product leadership at Nielsen, and has since become the research company’s president of global media products and advertiser solutions.

A few months later, Patrick Dineen, Nielsen’s SVP of local markets product leadership, raised expectations a little higher, telling TVNewsCheck that Nielsen would begin conducting trials of enhanced diary measurement in the second half of 2012 with a new form of metering.

The investment is “going to change the economics,” he said. “The goal…is to not radically change [what stations pay], but dramatically improve the sample size.”

But well into 2013, broadcasters have yet to see any enhanced diary trials, let alone enhanced diary ratings. Now, the word from Nielsen is trials could begin this year, which likely means improved ratings on which stations could do business would not come until 2014 at the earliest.

Most station execs consider diaries seriously flawed, and with good reason. It’s not uncommon for a given program to register vastly different ratings from one sweeps period to another.

To come up with local TV ratings in most markets, Nielsen distributes some two million paper diaries to sample homes in DMA 26 and above four times a year — the sweeps months of November, February, May and July — hoping that someone in each home faithfully records who’s watching what.

Nielsen’s station clients in DMA 26 through 56 rely on the diary data for demographic ratings, although they can get overnight household ratings from electronic set meters. Clients in DMA 57 and above rely solely on the diaries for all ratings. Clients in the top 25 markets use the local people meters, which promptly supplies household and demo ratings.

The diaries’ unreliability caused the Media Ratings Council to withdraw its accreditation in 2010.  And the diaries haven’t been able to win back the group’s seal of approval yet, according to MRC’s CEO, George Ivie.

At least two station groups have already opted not to subscribe to Nielsen because of the inaccuracies and expense —Nexstar Broadcasting Group and Morris Network stations.

They and others have turned to Rentrak, which offers local ratings based on set-top box data. Some broadcasters use Rentrak simply to supplement the Nielsen ratings.

Bruce Goerlich, chief research officer of Rentrak, says two markets have completely abandoned Nielsen in favor of Rentrak — Columbus-Tupelo-West Point, Miss. (DMA 133) and Victoria, Texas (DMA 204).

Bobby Berry, GM of Morris’s WCVI Columbus-Tupelo, says that even if Nielsen were to improve its small-market service, he would probably stick with Rentrak, which is servicing his station just fine. Dean Hinson, president of Morris Network, says the managers of his other stations decided individually not to use Nielsen.

Although most of Nielsen’s broadcast clients are disappointed with the pace of change, they are not ready to give up on the service. “It falls in the category of ‘out of our control,’ ” says Michael O’Brien, EW Scripps’ VP of TV sales, in speaking of the delays. “We’re in a volatile marketplace, and all of our competitors are in the same one.”

Doug Lowe, EVP of the Meredith Local Media Group, says it’s like dealing with a building contractor. “Whenever someone tells me it’s going to take four months [for a project], I double it in my head and know it’s going to take eight months.”

Sam Armando, SVP, director of strategic intelligence at Starcom MediaVest Group’s SMGx unit, says that Nielsen isn’t moving as quickly as he’d like. But, he adds, the industry as a whole is not “moving quickly enough” in finding way to accurately measure video viewing across all devices.

While broadcasters would like to see improvements in the numbers, they don’t necessarily want to pay for them.

“I understand that anything they do to improve the diaries is going to increase the cost associated with it. And for them to do that — for people who can barely afford ratings to begin with — they might see an exodus of clients,” says Justin Lewis, corporate research director, Fisher Communications. The station group subscribes to Nielsen and discontinued using Rentrak, partially due to the cost.

 “I’d like to see improvements happen in a hurry,” Lewis adds.

Matt O’Grady, Nielsen’s EVP and managing director of local media, says that he can’t comment on Hasker’s or Dineen’s 2011 promises, but he explains that Nielsen officials “went back and forth on should we start with LPM [enhancement], or should we start with diaries. And we chose to start with the LPMs.”

In July 2012, Nielsen announced that it was testing code readers in three LPM markets — St. Louis, Dallas and Charlotte, N.C.

O’Grady says that Nielsen has had “hundreds” of conversations with its clients and industry associations, bringing them up to speed on its progress, “every step of the way.”

According to O’Grady, the company currently expects to start enhancement trials in five markets that have both diaries and set meters this summer: Nashville; Greenville, N.C.; Birmingham, Ala.; Albuquerque, N.M.; and New Orleans.

In all five, Nielsen will install code readers that can tell what programs are being watched by picking up audio cues from programs. It will also increase the sample in the markets.

Within days, if not weeks, Nielsen will announce major trials in as many as 12 diary-only markets. In some markets, the trials will involve diaries and code readers; in others it will use a “triple play” of diaries, code readers and set-top box data.

Once the new systems are set up, there will be a six-month preview period, followed by a six-month “parallel” period, during which Nielsen clients will be able to compare the new ratings with the old.

After that year-long period — and after Nielsen and its clients are satisfied that the new measurement is ready — Nielsen will settle on a new system and begin rolling it out to other markets so that stations start transacting business based on it.

And one industry group, the Coalition for Innovative Media Measurement, is working with Nielsen to test an electronic version of the diary that will be available on a regular computer, smartphone or tablet, eliminating the need for respondents to use pen and paper.  “We’re scheduled for a test this spring,” O’Grady reports.

There are also two studies underway at another industry group, the Council for Research Excellence — one to improve diary sample quality and another to determine the statistical limitations of diaries.

While all of these wheels are in motion, yet another factor looms in the background — Nielsen’s deal to acquire Arbitron. Arbitron’s Portable People Meter “will be a valuable tool for Nielsen,” says Mitch Oscar, an ad  specialist and president of the consultancy HocusFocus. “People carry the instrument and it recognizes all signals around,” including TV.

While O’Grady is vague about the Arbitron deal’s implications, it could be that the PPM will eventually help Nielsen retire diary measurement altogether.

This story originally appeared in TVNewsCheck’s Executive Outlook, a quarterly print publication devoted to the future of broadcasting. Subscribe here.