Spot TV Finally Gets Credit For DVR Viewing

In 2010, Nielsen tried to replace the live-only ratings for buying spot TV in top markets with live-plus-same-day (live-SD) ratings for spot TV, figuring it was time that TV stations began getting some credit for viewership of programming on DVRs just as the networks did.

The move produced an immediate backlash from media agencies not yet ready to give such credit (or pay for it). They forced Nielsen to change its plans. To keep peace, it decided to issue both sets of ratings.

But since then, broadcasters have slowly worn the down the buyers, persuading increasing numbers to accept the live-SD data. Today, according to TVB, about 75% of advertising buys in Nielsen’s Top 25 markets with Local People Meters markets are negotiated using live-SD ratings.

The markets account for 49% of all TV homes, and a disproportionate 57% of spot TV ad dollars.

“About three years ago, I’d venture to guess that 10% of agencies were using live-plus-same-day ratings,” says TVB CEO Steve Lanzano, who has been leading the charge to get buyer buy-in on the new ratings. “Now, they’re all moving toward live-plus-same-day.”

Left on the outside for now are the hundreds of stations outside the LPM markets. In these smaller markets, viewership is still measured by a combination household meters and diaries or of diaries only.

In the 35 meter-diary markets, live-SD ratings are available. Diary-only markets pick up 24 hours of DVR playback in a different measurement called live-plus-24 ratings. But TVB’s focus at this time is making live-SD the currency in LPM markets.

“This is really only pertinent to the LPM markets,” Lanzano says.

Live-SD ratings take into account time-shifted viewing, which adds bonus ratings to broadcasters’ live ratings. In LPM markets in 2012, the average live-SD rating in broadcast primetime among adults 25-54 was 13% higher than live-only ratings.

Buyers say they have also been convinced by the reliability of the live-SD data.

“Where people have netted out, as DVR penetration increases and viewing expands across multiple days, most people have lined up with live-same-day ratings because it’s stable,” says Maribeth Papuga, EVP and director of local investment at MediaVest.

“The audience in live-only continues to shrink. And when you’re at low ratings the instability makes it more and more difficult to project ratings because there’s so much more delayed viewing.”

Lanzano says that opposition to live-SD ratings has eased as live-SD ratings have begun to align with C3 ratings.

The gap between live-SD primetime ratings and C3 ratings in LPM markets has been shrinking among adults 25-54, from 14% in 2010 to 9% last year. At the same time, the gap between live-only and C3 ratings has been increasing, from 5% to 11% in 2012.

“Looking at the numbers and comparisons to C3, live-same-day is closer to C3 than live-only ratings,” says Lanzano. “We are out there meeting with agencies, showing this research and meeting with our members.”

Not every media agency is going along with live-SD.

“You’re getting an inflated number when you buy a live-same-day rating,” says Ellen Drury, president of local broadcast at GroupM. “Any time you have delayed viewing there is commercial avoidance. In local, these are quarter-hour program ratings. It’s not like national, where it’s minute-by-minute ratings where you can get the commercial rating.”

Broadcasters see live-SD ratings as the least the buyers can do.

“We are pushing for live-plus ratings for a lack of a better metric at the moment,” says Larry Wert, president of broadcast media at Tribune Company. “We just want to get paid for commercials that are viewed. Live-only falls short of that. We can’t get C3 numbers locally, but live-plus-same-day comes close to C3.”

“At a bare minimum, we believe that local viewing should be measured including DVR viewership,” says Valari Staab, president of NBC Owned Television Stations. “Our local measurement should reflect the way people watch TV today.”

There is a significant amount of time-shifted viewing taking place in local markets, particularly the top markets.

Nationally, each month nearly 160 million people watch time-shifted TV, up 11% in fourth quarter 2012 from a year earlier.

In the first six weeks of the 2012-13 broadcast season, 24% of live-same-day viewing in Nielsen’s LPM markets was time shifted, compared to 20% nationally, according to a TVB analysis of Nielsen ratings.

If all deals in the first six weeks this TV season were done with live-only ratings in the top 25 markets, advertisers would have gotten a bonus 140 million primetime impressions among adults 25-54, TVB says.

“We know not everyone skips commercials,” says a national sales rep who asked for anonymity. “And not everyone watches all the commercials. But if we’re talking about millions of viewers and, say 45% watch the commercials during playback, live-only ratings miss a lot. That’s shortchanging the broadcasters by millions of viewers.”

There’s also a practical reason to agree a single currency in the top markets, says the rep. Having multiple data streams is costly to store. And it’s difficult to churn out all the data needed when sellers are working with ad agencies that use different data streams.

“It’s easier if there’s a standard,” he says. “We have a research department that supplies information to our salespeople. They produce a lot of information. They just simply cannot do multiple streams. So, my salespeople are going to agencies with data that’s different from their standards.”

 Alan Picozzi, VP and director of research at rep firm Petry Television, hopes that national TV’s likely move from C3 ratings to C7 ratings in the near future may spark the local TV business to hurry up and settle on live-SD.

“The momentum always comes from national,” he says. “There is momentum to move beyond C3. I just want one official stream.”