Despite a pandemic that has forced many Americans to shelter at home, Nielsen will, after all, follow through on its plans to chase TV viewers in bars, hotels and offices.
After meeting with a storm of criticism from TV networks, Nielsen is expected to reverse its recent decision to delay the inclusion of so-called “out of home” viewers in its tabulation of national TV ratings, a sign of just how important counting that audience is to some of the nation’s biggest traditional media companies.
Nielsen held conversations Friday with several senior ad-sales executives at top TV outlets, according to six people familiar with the matter. The media-measurement giant has informed those networks and others it now intends to count out-of-home viewers during the fall season as it had originally planned, these people said. An apology from Nielsen to its clients is expected as part of the discussions, according to three of these people. The measurement firm unveiled its decision earlier this week without informing the networks in advance, these people said.
After hearing comment from the netweorks, “it became clear that we had misunderstood the extent to which upfront deals have already been agreed to using out-of-home metrics,’ said Nielsen CEO David Kenny, in a letter to clients sent late Friday. “Given the circumstances, we recognize that a delay would cause greater disruption to the industry than maintaining our original plan. I also believe Nielsen needs to deliver on our promises, so that you can transact with trust and confidence,” he added.
ViacomCBS, NBCUniversal, Fox Corp., WarnerMedia and Walt Disney could not make executives available to discuss the matter.
The plan to bring a tabulation of people watching TV outside their homes for the next TV season was announced at the start of the last. In September, 2019, Nielsen said it would be able to add viewers watching TV shows in airports, at “watch parties” and more, a sign of how much more viewing is done other than a family living room, and a potential boon to the networks as they battle the migration of thousands of viewers to streaming-video hubs like Netflix, Amazon and Hulu.
Nielsen earlier this week cited the effects of the coronavirus pandemic on consumers’ ability to watch TV in restaurants or doctors’ offices, given ongoing directives to shelter at home and avoid prolonged visits to public spaces. But the company apparently never gave any of the networks an indication of its thinking, according to people familiar with the matter. What’s more, the networks had already begun to craft “upfront” deals that included estimates of the out-of-home audience, these people said.
The TV companies had reason to believe they’d be able to show off more robust audiences to Madison Avenue. Counting out-of-home viewers was expected to give some networks an 11% boost for sports broadcasts and a 7% lift for news programs. CBS, which is schedule to broadcast Super Bowl LIII in 2021, had been anticipating an increase of between 10% and 12% in total viewership for the game, if not more – a prediction it has no doubt been using in its quest to enlist sponsors for the gridiron classic.
TV executives were frustrated by the maneuver, particularly because Nielsen CEO Kenny is a former senior ad-agency executive who would have a deep understanding of maintaining relationships with clients.
TV networks have long complained about Nielsen, just as the average consumer might vent about the cable company or the local electric utility. Nielsen has for decades provided a service few can afford to be without. But that hasn’t kept them from continuing to pay millions of dollars in fees for the company’s measurement services – with some exceptions over the years. In 2015, NBCUniversal’s CNBC business-news outlet said it planned to stop using Nielsen to measure the audience for its daytime schedule, which is watched heavily by Wall Streeters and corporate executives in offices, on trading floors and during travel. The network, which has relied instead on surveys of the daytime media habits of investors and financial advisers by market-research firm Cogent Reports to set rates with sponsors, has yet to return to the traditional system. CBS let its contract with Nielsen lapse for several weeks at the end of 2018, citing a desire to see the company move more quickly to develop methods of measuring viewers watching TV with mobile devices and streaming video.
“We regret any disruption we may have caused you, your customers, and the market this week,: Kenny said. “Going forward, we are committed to ensuring a more complete, inclusive, and transparent process as the currency evolves with changing consumer behavior.”