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Networks Look to Turn Data Into Dollars

Ratings, shmatings. As more viewers go unmeasured watching shows on computers, tablets and smartphones, networks are dreaming up new methods for making their audiences add up in ways that are attractive to advertisers.

“The game plan is a simple one—to move away from the concept of audience measurement to performance measurement,” says David Poltrack, chief research officer at CBS Corp.

It’s so important that resources and manpower are being devoted to the effort at a time when most other areas of media companies are being cut back, partly because inadequate metrics are undermining the advertising revenue stream.

“If we were simply basing our judgements, both commercially and creatively on Nielsen, I think we’d be lost,” says Kern Schireson, executive VP, data strategy and consumer intelligence at Viacom Media Networks.

Nickelodeon’s and MTV’s young viewers have made Viacom the poster child for the necessity of more comprehensive measurement.

As part of Viacom’s recent restructuring, the company’s research organization brought together groups that work on first-party data capability, data science, data product and monetization, including an alternative currencies working group.

“We’ve really retooled the way we think about our metrics and what it means to a 21st century media company and how that links to our ad operations group, our digital products platform,” Schireson says. “We’ve been quietly doing a lot of homework and a lot of infrastructure building to be ready for this year. We think this really starts to reshape the business.”

For example, when MTV launched Eye Candy, Viacom’s research found more than double the impressions the ratings showed.

“It was a great show and a great premiere for us,” Schireson says. Just using ratings to measure it “would have been a disaster because not only would we have failed to see the true impact of the show, but we wouldn’t have understood the way it truly did embody what we wanted it to be.”

Viacom’s measurement system aims not just to count viewers, but also to measure the impact its programs have in the social space specifically and the culture generally.

The amount of data Viacom collects to do that is humongous. Between its digital platforms, apps and social connections, data scientists at Viacom track each in-depth interaction a consumer has with its content and put it into a row in a database. The database now has 15 billion rows and covers 60% of U.S. households.

“That allows us to have a pretty robust environment in which we can model behaviors,” Schireson says. “We’ve also acquired the ability to stitch those proprietary data points together with return-path data from set-top boxes as well as syndicated Web behaviors across the broader Internet and social activity.”

That means Viacom can single out consumers and know what they buy, what they say and what they watch. It also provides an opportunity to see its impact on consumers. “We see those changes in their consumer behavior, in their online activities, in their social conversations after they’ve been participating in a conversation with us, engaging in our content and being subject to some of the commercial messages that our partners bring to it,” Schireson says. “We’re playing three-dimensional chess, where traditional media measurement is still checkers.”

As data becomes a mantra, marketers are interested in the insights Viacom has, and might be more willing to use its metrics when spending advertising dollars.

Last year, Viacom worked with more than a dozen clients to develop metrics that better measure the impact of content and ad messages. “Going into this year I think there is more hunger and more willingness to really transact in a different way,” he says.

Media buyers are hearing the message. John Nitti, chief investment officer worldwide at ZenithOptimedia, says he’s in early conversations with Viacom. “It makes sense that if a network feels that they’re being underrepresented they’re going to try something else to get better valuations,” Nitti says. “We take that all into account as we enter into partnerships and as we enter into the upfront with them.”

Nielsen says it is aware of the situation and developing solutions.

"We are actively working with the buyers and sellers of video advertising to not just agree on, but help redefine the currency from the current three-day and seven-day metrics to being able to total up viewers, no matter the device, platform or delivery system," says Steve Hasker, global president at Nielsen.

That said, networks are working through how to measure the impact of their advertising.

“We’re now three years in to looking at and bringing to market new data solutions to more accurately measure both quantitatively and qualitatively our audiences,” says Mike Rosen, executive VP for ad sales at NBCUniversal. “What we’re bringing to market this year is more progress in bringing the best of data and technology to our customers.”

For example, NBCU’s CNBC is no longer using Nielsen to measure the audience for its Business Day programming, and has turned instead to Cogent, a research company specializing in the wealth management business and the money managers and investors who watch the network’s financial news programming at work. “Current Nielsen methodology is simply not capable of accurately measuring the core target viewer of that programming, which is the very essence of why our customers advertise there in the first place,” Rosen says. The new data provides “a better understanding of who you’re reaching and the impact of those decision-makers. It only makes your decisions smarter, more accurate, more precise.”

Over the past year NBCU has introduced a series of ad products that employ data to more precisely target advertising. In this year’s upfront NBCU is offering clients the use of its Audience Targeting Platform, which fuses set-top box data with first- and third-party consumer data to find for individual clients the optimal programming mix across the NBCU portfolio.

Nielsen will continue to measure the number of viewers ads are reaching, but Rosen compares that to measuring how much a box of cereal weighs, while ATP measures the nutritional value of the cereal itself, or how effective the campaign is. “We know that the quality, breadth and scale of NBCUniversal’s linear TV portfolio makes it the super food of the media marketplace. So this will just help us prove it.”

For ESPN, cross-platform research is at the top of the game plan. And it’s proved to be a big job.

“We don’t think any one single vendor is able to pull off what’s needed,” says Barbara Singer VP, advertiser insights & strategy, at ESPN. After seeing presentations from comScore and Arbitron, ESPN got them together to create Project Blueprint, which is designed to find the unduplicated reach and frequency for campaigns across five screens—TV, radio, PCs, tablets and smartphones. It relies on set-top box data for granularity and panels to get a good read on demographics.

ComScore is now developing Project Blueprint to provide data industry-wide. “We were the ones who funded it in the beginning, so yes it was all about ESPN measurement. But the goal of it has been to be industry-wide,” Singer says. Industry research group the Coalition for Innovative Media Measurement is completing a phase 2 pilot test of Project Blueprint with 10 media companies and three cross-platform ad campaigns.

ESPN is also doing its own tracking research to gauge the marketing effectiveness of different sports and media mixes. “You can’t wait for anyone. This is definitely a climate of ‘figure out a way that you can help your clients leverage their dollars better,’” Singer says. “There is no solution that is off the shelf as far as we can see.”

Next up? “There’s a huge appetite for understanding the role of mobile,” she says.

CBS recently introduced what it calls a Campaign Performance Audit, designed to maximize advertisers’ TV spending and improve return on investment. CBS is employing a full complement of Nielsen analytics, including Nielsen Catalina Solutions, Nielsen Buyer Insights, Nielsen MotorStats, Nielsen MRI Fusion, Nielsen Brand Effects and Nielsen Cambridge Media Demand Landscape to evaluate campaigns.

“We’re going to continue to buy and sell on the basis of Nielsen demographics for short-term future anyway. But we don’t want your television campaign to be judged on the efficiency of exposure because that isn’t the true measure,” says CBS’ Poltrack. “We want to be judged on actual performance and we’re now making a commitment to advertisers to say we will work with you to develop the metrics and provide the metrics that answer the question, did my advertising generate a positive return on investment.”

Poltrack says better metrics will show clients that using TV dollars to pay for digital advertising hurts sales.

“The more we are able to provide the advertiser in terms of definitive proof that their advertising is working, the less we have to worry about the measurement of the counting of the audience,” he says.