While a highly public battle brews to break up Nielsen’s monopolistic hold on the national television measurement business, Comscore more quietly is making advances against Nielsen on the local ratings front.
Media buyer Zimmerman Advertising, part of the giant Omnicom Media Group, will be testing Comscore data for use as local market currency.
The agency said the test is part of the agency’s focus on driving results for clients and ensuring that they have access to the most accurate and robust datasets for TV measurement, especially as networks and stations have adopted Comscore as their currency.
One of the largest station group owners, E.W. Scripps, is letting its agreements with Nielsen expire and will be using only Comscore for measurement and media buying currency starting in January. Earlier this year Scripps expanded its relationship with Comscore to include all of Scripps's stations, adding 16 stations in the process. (Scripps’s national networks continue to work with Nielsen.)
“Our goal with our local television stations is to measure our markets’ audiences in the best and most thorough ways available to us so advertisers understand the true size and value of the audience we are delivering. We believe Comscore is best positioned to provide that for us at this time,” said Brian Lawlor, president of the Scripps local media division.
Jon Carpenter, who took over as CEO at Comscore in July, told Broadcasting+Cable that local was at the top of his priority list.
“We’ve made some significant progress in local,” Carpenter said, with local revenues expected to grow 25% this year compared to last year.
“I think that goes to the reliability of our offering and the consistency with which we can produce the data. If you’re an outcome-driven client, which the vast majority of the folks that we work with are, the reliability and stability of that product is what’s resonating,” Carpenter said.
Comscore is also delivering on Carpenter’s early promise to get data about viewership and media effectiveness into the hands of clients faster, allowing them to make adjustments while campaigns are still in flight. “This is a first for the television industry to have 48-hour data available in all 210 markets,” he said.
Over the last five quarters, Comscore has been picking up local business on a fairly steady cadence, said Carol Hinnant, chief revenue officer at Comscore.
Stations' Choice
In addition to Scripps, the local broadcasters expanding their relationship with Comscore over that time include American Spirit Media, Gray Television and the Fox Television stations. Comscore is also the only measurement company certified for use as local currency by NBCUniversal.
Comcast’s Effectv ad sales unit designated Comscore as its preferred measurement provider, joining Charter Communications-owned Spectrum Reach.
“We’re using Comscore because we believe in the methodology, kind of plain and simple,” Beth Plummer, senior VP, chief revenue officer, Spectrum Reach. “They say they have a massive and passive system of audience measurement that is based in part on our aggregated and di-identified first-party data. We feel because it is near-census-level data that it’s more accurate and that’s why we prefer to use Comscore.”
WideOrbit replaced Nielsen with Comscore on its local advertising platform and media agencies Imaginuity (the ad agency behind the “We Buy Ugly Houses” campaign in multiple markets), Horizon Media and Dentsu are now either using or testing Comscore data as local ad buying currency.
“We built that business over time and now you see this kind of rolling,” Hinnant said.
Hinnant said she expects Comscore’s momentum to continue into 2023. The Media Rating Council audit of Comscore’s local ratings is complete, an important part of becoming accredited, she said. (Nielsen’s local ratings are not currently accredited.)
Comscore has added viewing via virtual multichannel video programming distributors like YouTube TV and Hulu Plus Live TV to its ratings, a move that seems to be less controversial with local market execs than Nielsen's adding broadband-only homes to its ratings.
Nielsen's Issues
Nielsen’s issues are contributing to Comscore’s gains, Hinnant allowed. “Both the buy side and the sell side say they know they need better measurement. That’s why they’ve invested in Comscore and championed us,” she said.
Despite picking up new clients, Comscore still has a way to go to top Nielsen, particularly when it comes to share of local revenue.
During Comscore’s second-quarter earnings call, Carpenter told analysts that budgets for local measurement are 2% to 3% of the $24 billion spent on local advertising, or between $480 million and $720 million. He said Comscore estimates that Nielsen collects between $400 million and $500 million of the spending on local measuring, while Comscore has about a 10% share, putting its local revenue in the $48 million to $72 million range.
“The gap between our 10% and that $400 million to $500 million is significant as a near-term opportunity for us in a place we expect to win,” Carpenter told the analysts.
In updating the local revenue situation for B+C, Carpenter said “we expect to deliver close to 25% year-over-year growth in local this year, driven by the hard work and focus of our teams and what they put in. This is the fastest growth rate we've had in local over the last several years and points to the momentum we're building. We're in the early innings still, but we're not slowing down.”
Accounting Issues
Comscore got into the local TV measurement business when it acquired Rentrak in 2016. Regulators discovered accounting issues relating to the Rentrak acquisition that led to a costly and distracting re-audit of the company, fraud charges, a series of losses and the departure of numerous senior executives, including former CEO Serge Matta.
In 2021 Comscore got a fresh start when Charter Communications, Quarte and Cerberus made a $204 million strategic investment in Comscore, wiping out the company's debt.
Comscore reported a $52 million loss in the third quarter. The losses included goodwill charges and costs related to a restructuring that included employee layoffs and the company exiting certain businesses. In November Charter gave Comscore more financial assistance, giving the measurement company $7 million in credits over two years and extending the deal giving Comscore access to Charter set-top-box viewing data. Charter can also use that data in additional ways under the new deal.
Comscore stock closed Friday at $1.25 a share, down from a 52-week high of $3.55.
Carpenter said the restructuring in part will help Comscore focus on businesses including local media.
“We feel good about the direction that we’re headed with the focus first on local, because we know that execution helps us deliver for our clients at a national level because it's the same methodology,” he said.
That methodology, along with the use of Charter data, are why Comscore is preferred over Nielsen as the measurement provider for Spectrum Reach.
“Comscore uses our return-path data so it’s near census level. When you’re using near-census-level data, not panel data, you get more stable data,” said Charter’s Plummer. "When we create campaigns on the front end, it's more likely to deliver the audience on the back end. It’s just more stable. We see less fluctuations in the viewership estimates all the way around.”
Plummer noted that Comscore is turning its data around faster. And by being more granular, Comscore data is more useful to clients looking to reach targeted audiences.
“Local clients are shifting in that direction and Comscore, because it is household-level data, they do have audience attributes against the data too,'' Plummer said. “So they are well equipped to do that.” ■
