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GRP to CPM: Accelerating Full Adoption of a New Currency

Justin Rosen, VP, data and insights
Justin Rosen, VP, data and insights (Image credit: Ampersand)

As the digital transformation of the linear TV industry progresses, a true multiscreen TV marketplace that blends linear and streaming inventory in a coherent, unified construct is upon us. Efficiency and scale of deterministic viewing insights and the impressions they derive are becoming fortified. Workflows, technology, and processes are also advancing.  All the boxes are being checked. Except for one—transactional currency.

In order for TV to truly meet the moment, we need to actually walk the walk and not just talk the talk; specifically, we need to accelerate progress industrywide to fully transacting TV inventory using impressions and finally do away with gross ratings points (GRPs) once and for all. The quicker we do this in earnest across the board, the faster we will achieve the benefits of closer alignment with how streaming inventory (and most other forms of media) are already transacted. That means finally shifting “one column over” on the spreadsheet from cost-per-point (CPP) to cost-per-thousand (CPM). Only then can the buy and sell sides achieve both transactional and measurement parity across linear and streaming for all holistic TV media plans. If we don’t, we will never truly achieve the full potential of today’s audience-first, multiscreen TV ecosystem. 

The TV industry has acknowledged for a while that the impression metric to transact will simplify how campaigns are evaluated across platforms - as well as for all levels of geographic precision, be it national, multi-market, or DMA. But the push towards universal adoption has been happening at a snail’s pace – especially in the Local TV ecosystem.

Why has this taken on greater urgency now? Because data and technology improvements are also finally meeting the moment. For example, it is now possible to verify through third-party sources all multiscreen audience impressions across TV & streaming. Further, associated operations like cross-platform billing for audience impression delivery are emerging. And all of this can connect seamlessly with enhanced campaign reporting containing audience-specific delivery metrics and efficiency calculations.

Don’t Let Perfection Be the Enemy of the Good

No longer can we drag our heels and hold out for the magic bullet solution. Going from CPP to CPM will have its pain points - any transition does - but they can be overcome with determination and focus. We all know change is hard, and it involves risk. It can also seem expensive in a fragmented, uncertain marketplace with margin pressure. Unsurprisingly, many default to inertia.

If You’re Local, Start Small

There can be flexibility and transitional steps in this evolution to an impression-based currency. For example, I know those of you in the Local TV arena have traditionally relied on a ratings metric as a means to generate a relative understanding of audience weight across markets of various sizes. However, there are now platform solutions available in the marketplace that will allow agency planning teams to still use ratings to plan Local TV with this in mind. That metric nonetheless can then be converted to impressions by your buying cohorts to use in negotiation. In 2021, National TV has been transacting increasingly on impressions the way the digital community has. Local TV can also make this transition relatively smoothly. The time to act is now.

Make Audience-First Impressions Count

Using Nielsen age/sex - but impressions not GRPs - is the prerequisite for where the industry must wind up: sculpted audience impressions. In other words, we will eventually transact linear TV media on more sophisticated, granular targets like luxury car buyers or heavy online shoppers, just like digital media does today. But in getting to these more refined audience segments, we must all first work together to ensure that data sources, audience definitions, and targeting technology are in reasonable alignment. This will ensure that the consistency of today’s age/sex world is maintained when we are audience-first.

At the end of the day, there will be some operational, technological and process hurdles to be overcome in transitioning from CPP to CPM, but the biggest challenge is legacy thinking and the inertia that it creates. For the TV ecosystem to stay strong as we emerge from our year of quarantine, we must no longer be so tentative when it comes to once and for all moving our transactional currency to CPM. Let’s commit, and collaborate with authority, to make our industry more simple and transparent.

Ampersand is the insights-based TV sales and platform company, providing audience-based buying and advanced measurement across linear and streaming TV.

Justin Rosen

VP Data & Insights, Ampersand