The announcement last week of an alliance between Web behemoth Google and TV ratings giant Nielsen was the latest ripple in the television industry that began with the adoption of C3 (average commercial minute plus three days of DVR playback) as the new industry standard on which ad guarantees are written.
What was missing amid the buzz about a partnership between old-school (Nielsen) and new-school (Google) was that Google's TV ad inventory—two minutes of national and local advertising an hour on 94 of EchoStar Communications' Dish Network cable channels (Lifetime, ESPN, etc.) isn't exactly prime inventory, according to buyers. (Google also sells the ad space via blind auctions, which is standard for online advertising, but not a model many TV ad buyers are likely to embrace.)
The deal gives Google access to Nielsen's demographic data. Google's TV Ads platform gives buyers second-by-second set-top-box data 24 hours after their spot runs. (It takes Nielsen three weeks to process its C3 data.) Such granular data gives buyers the tools to make ads addressable and highly targeted, the Holy Grail for advertisers struggling to reach consumers in the fractured media market.
But some question the accuracy and usability of data culled from a fusion of Google set-top box data and Nielsen demographic data. As it stands, the Nielsen sample is only 12,000 homes. That sample would be further pared down in a fusion of Nielsen and Dish homes. (With 12.3 million subscribers, Dish is second in market share to DBS leader DirectTV, which has 16.5 million subscribers.)
But Google's intentions are in the right place. The Internet company hopes to bring the addressability inherent in the online ad space to television advertising, where the buckshot approach has been the norm.
Measurement companies including Rentrak—which tracks VOD viewing—argue that the census-based data stream of set-top boxes allows for a much more reliable picture. (Rentrak is testing a new TV ratings system, called TV Essentials, that crunches data from 500,000 set-top boxes from multiple markets.)
And Google is certainly looking to extend its reach beyond its Dish Network inventory.
“We believe that this is a platform that can bring value with just about everybody that has television inventory. We have a full blown aggressive effort to introduce this platform to major media companies,” says Michael Steib, director of Google TV ads, though he declined to offer details about those efforts.
And while set-top box data is touted as the road to further granularity, what it doesn't provide are specifics about the person consuming the media: how old they are, whether they are male or female or how much money they make. Which is why Google thinks it needs Nielsen's demographic data. But what Nielsen gets from the partnership is invaluable: buzz and perception that the company is embracing the post-millennium ad-space model.
And Nielsen, which has been on a spending spree of late, acquiring or forming alliances with a plethora of small media measurement companies, including Telphia and IMMI (both of which measure out of home viewing), will now have a direct pipeline into the dominant online advertising company.
With Google's acquisition of DoubleClick pending FTC approval, the company is poised to become the biggest ad server in the digital space. Google is trying to extend that dominance to television at a time when traditional media is in a state of upheaval.
“The reason we got into the television advertising business, is that we fundamentally believe that we have built technology platforms that make advertising more accountable,” says Steib. “That's what Google has done with advertising online: You've got great measurement; you always know exactly how many impressions you're getting; you've got this great feedback loop. Those levels of accountability, those areas of better measurement and those tools for optimizing your campaign have been the exclusive domain of Internet advertising. We believe that those tools should be brought back to traditional advertising as well.”