The TV industry is getting ready for its annual “upfront” market, when billions of dollars in advertising trade hands. And almost everything is in place — except a firm backing of the economics that guide all the deals.
Both Nielsen and its rival, Comscore, are unlikely to win accreditation of their national TV ratings services in time for the upfront, which typically kicks off in May and lasts through much of the summer. Nielsen, the longtime arbiter of how many people watch TV (and the commercials that support it), lost its industry backing in September after acknowledging under pressure from the networks that it had likely undercounted audiences during the height of the coronavirus pandemic. Since that time, the company has run into new headwinds, and recently blocked a possible sale to a group of private-equity firms.
According to a notice posted Thursday by the Media Rating Council, an industry body that certifies measurement processes, “Nielsen’s remediation work will extend into Q2 2022, and therefore a complete audit report is not expected to be delivered to MRC until the end of Q3. Additionally, an audit of Nielsen’s ‘Big Data’ inputs to its future TV measurements is currently in process, with this audit report expected to be delivered to MRC in mid Q3.” An audit of Comscore’s TV-audience measurement service, meanwhile, “began in Fall 2021, with an audit report expected to be delivered to an MRC audit committee in Q3 2022.”
Nielsen said in a statement it had “made good progress” toward regaining accreditation, and noted its “current audit timeline has been reduced significantly from previous audits. We remain committed to working alongside MRC and are approaching reaccreditation with a cross-platform mindset.”
Lack of accreditation doesn’t mean the Nielsen ratings can’t be used. But its absence has already spurred NBCUniversal, WarnerMedia, Discovery, Paramount Global and Disney to test alliances with rival measurement vendors, and ask advertisers and media buyers to come along for the ride. NBCU and WarnerMedia have struck measurement partnerships with iSpot.TV, for example, and Paramount is working with Videoamp. Discovery has enlisted Omnicom Media Group and clients like AT&T and State Farm to test measurement efforts by Comscore and Videoamp.
Some big players are hedging their bets. Publicis Media, for example, is currently involved in tests with NBCU of work by iSpotTV, as well as with Disney, which is involved with Nielsen as it tries to launch a new measurement system later this year.
How hard can it be to count the number of people watching a TV show? In 2022, the task is more daunting than ever.
Traditional TV viewership is in noticeable decline, as audiences rush to watch their favorite dramas and sitcoms on streaming services. “Cable and broadcast networks have seen their audience reach evaporate, falling double digits over the past several years,” said media analyst Michael Nathanson in a research note Thursday. “That reach is increasingly focused on older, power users of live content.” To get back the audience metrics they need to bring in big hauls of advertising cash, the networks must find a way to convince Madison Avenue of the integrity of new tabulations of people using ad-supported versions of services like Hulu, Peacock, Paramount Plus, Discovery Plus. Even Disney Plus, currently available without commercials, will offer an ad-supported version later this year.
Advertisers are also flush with new consumer data and want to use it when making their TV ad buys. Nielsen typically measures groups according to age and gender, with viewers between 18 and 49 representing Madison Avenue’s favorite crowd because younger people are more likely to be persuaded to try a new product or service. In an age when advertisers know more about their customers’ habits because of digital media, however, they are increasingly eager to deploy commercials in front of crowds that may have more interest in buying a car, or are more likely to see a movie in its first weeks of release. Over time, says one media-buying executive, advertisers are likely to do deals based not on how many people see an ad, but on how many people act upon that’s ad message to make a purchase, visit a car dealership or request a coupon via email.
Until that happens, however, the networks are moving on their own. Earlier this week, NBCUniversal said it had offered “certifications” of eight new measurement partners. But some advertisers and agencies may blanch at the idea of the network that makes money off the sale of advertising acting as the verification of the measurement system behind it. Indeed, Media Rating Council said Thursday its audit of a service from iSpot that monitors response to commercials that air on linear television was “currently underway,” but was not likely to be done by May. MRC at present expects a report that is necessary for completion of its iSpot audit won’t be delivered until mid-summer, according to a spokesman for the organization. In a note published Thursday, Kelly Abcarian, executive vice president of measurement and impact at NBCU’s advertising-sales division, said “we will be transacting against our certified cross platform partner, iSpot.tv,” in the next round of upfront negotiations.
“Our certifications aren’t permanent or set in stone,” Abcarian added, in the memo. The company has been open about putting dozens of potential measurement vendors through a proposal process.
The networks are likely emboldened by the fact that digital-video rivals like Facebook, YouTube and Netflix have thrived without being tethered to a Nielsen-like entity. To be sure, there are measurement companies that seek to tabulate activity in these venues, but ad deals haven’t always been bound by them. The Association of National Advertisers, an influential trade organization, has for years called for independent audits for companies that operate so-called “walled gardens,” where the media provider controls content and access to it by independent verification services.
Advertisers are eager to test all the new concepts, said the media buyer, but no one wants a system where each network cobbles together its own measurement offering. The networks can’t be left to “grading their own homework,” the executive said. “We know that.”
In the interim, advertisers are left to test every system that’s being offered, because no one is quite sure if Nielsen can rebound from its woes, or if the industry will coalesce around something new. Nielsen still has some things going for it. All parties use it and some big advertisers continue to make their plans based on decades of historical data from the company. Many ad buyers and advertisers also remain skeptical that any of the media companies, already plowing billions into creating new content for news streaming hubs, will cough up the millions likely to be required to build a new measurement infrastructure.
“We need the industry to be on one platform,” says the media-buying executive. “No one knows what that could be right now.”