A report issued by the Video Advertising Bureau this week revealed that Nielsen underreporting during a 15-month period from September 2020 to December 2021 cost the television industry over $700 million in those months, wirth roughly half of that occuring during the six months between May and November 2021. VAB-5-Fast-Facts-Nielsen-OOH-Undercounting-Jan
Further details, revealed from exhaustive studies of hundreds of reports from Nielsen’s own software, revealed that underreporting was proportionately greater among younger audiences, particularly 18-34s, and minority segments, and that the gaps with those audience sectors versus general population were widening. As of December, for example, the gap between the percentages of underreported impressions among total Hispanic persons 2+ versus total TV viewers was twice asalrge as it was two months prior, and now four times as large among Hispanics than gen pop. Similar trends are revealed among advertisers’ more coveted audiences.
Nielsen’s response? As reported in TV Tech, a Nielsen company statement said :
“We reviewed the information shared by the VAB today, and while we acknowledge the understatement in a portion of our National out-of-home audiences, we stand by our prior statements that the magnitude of the issue was very small for the majority of telecasts.”
The Media Ratings Council, the watchdog group that itself has suspended Nielsen’s accredidation, added in their own statement:
The VAB report made several references to ‘adjustment factors’ that were attributed to MRC, resulting from an analysis MRC conducted last year that concluded certain understatements to Nielsen’s ratings had occurred,” the group said. “In fact, MRC did not position these figures as `adjustment factors,’ nor did MRC recommend they be used in that manner; rather the figures MRC published in May 2021 were presented simply as estimates of ratings understatements that MRC believed occurred in the single month of February 2021. February 2021 was chosen as the subject of the analysis at the time because MRC believed it represented the period at which the potential COVID-related impacts to Nielsen’s panels were at their peak.”
Well, it is indeed true that the overwhelming majority of telecasts analyzed were statistically unimpacted. But those that were impacted were disproportionately live sports, which represented over 85% of the top 100 programs measured by Nielsen in 2021, So while it’s true that only a fraction of cases resulted in infection, those that were infected were so severely. And the body responsible for the accountability in effect is attempting to minimize it.
Does this pattern sound familiar? Perhaps reminiscent of partisan debates on vaccine efficacy?
I’m not about to equate the loss of advertiser impressions to the loss of human lives. Nor am I going to equate the VAB report to the Radical Left and Nielsen response to the on-air reporting of OAN or Newsmax. But the very idea that the response from legacy organizations to this extremely thorough and meticulous analysis has been so defensive calls to mind the kind of parochial debate we see on cable news nightly and that leaves many of us with sleepless nights. From what I’ve seen from the public comments of quite a number of my former and current research peers and leaders, their nights are much more sleepless thanks to these results and reactions. The financial health of their businesses, and thus their livelihoods, is directly impacted by these trends.
The reality is that lost impressions mean the need for more makegoods, which result in fewer opportunties to sell a finite number of spots. Unlike print or online, which theoretically can add pages infinitely, time is finite. There will only be 24 hours in any day. If fewer people are watching any one ad to begin with because of splintering and lifestyle change, it is all the more imperative that a reliable third party be able to count as many of the eyeballs that are viewing accurately regardless of what kind of screen that viewing is taking place.
Much like the debate on vaccines, the impact on any one entity, life or program is inconsequential in the big picture. But how these decisions impact the big picture are very much consequential. Nielsen’s ongoing development of Nielsen One, which it intends to roll out within a couple of years, is all but an admission that there is indeed a problem that needs to be fixed. In my opinion, their response to the VAB analysis was, frankly, as tone-deaf as the trumpeting of their new logo as the signature announcement at the truncated CES show earlier this month.
Having established that, though, it is also important to acknowledge that commercial networks’ despair over this that drove the demand for the VAB study is not without its own agenda. They face the reality that even within many of their own companies their ability to measure their popularity and monetizability is inferior to that of streaming services, particularly those that are not reliant upon commercials. Netflix has spearheaded the development of their own internal measurement as their standard for success, and is now making that data available publicly. They have their own problems, of course, as this week’s stock fluctuations and their controversial announcement to raise their monthly subscription fee attest. But data democratization isn’t one of their issues.
It is an issue for their newer, vertically integrated competitors reliant upon subscription and advertisers. Peacock. for example, reported just under 24 million monthy active accounts, of which just over a third (9 million) are currently paying subscribers. Put another way, two-thirds of Peacock’s accounts are consuming content exclusively for free. Peacock’s long-term viability is dependent upon growing ARPU (average revenue per unit).If subscriber growth is limited, it is imperative for them to grow revenue from ad sales,. n another press release issued earlier this week, Comcast vowed to invest $3-$5 billion in incremental investment of original content to grow the demand for the Peacock Premium tiers. (I suppose we should be thankful that another season of a Punky Brewster reboot won’t be part of it.) The very existence of the bird depends upon its ability to prove it has eyes on its plumes.
So if it’s indeed true that the crisis of measurement efficacy is one driven by advertiser demand and its impact on the more traditional business models reliant upon it, maybe a viable solution is for an agency conglomerate–or even a consortium of them–to buy Nielsen and accelerate the rollout of Nielsen One to a more aggressive timetable to meet the desires of their spot carriers? For those that might cry “foul!” in saying a buyer can’t own the currency, remember than WPP owns Kantar, which competes very effectively with Nielsen in the measurement of advertising in the U.S. and in audience measurement in many territories around the world.Sucb a move would likely result in more transparency of the development process for the necessary evolution in cross-platform measurement, and, as VAB’s report reminds, a more competitive and responsive competitive marketplace as well. Nothing spurs innovation and efficiency more than competition.
I have learned through personal challenges that the first step to recovery is admitting there is a problem. Nielsen must do a better job with Step One in their world than political factions have done in theirs. Working with, and not in conflict, with their clients would be a very well received Step Two. One might say it could be a shot in the arm.
Until next time…