Deals negotiated in the 2016-17 upfront are still being finalized, but discussions are going on that could result in a big change for next year’s upfront.
Rino Scanzoni, chief investment officer at media buying giant GroupM, says he’s talking to the networks and measurement companies Nielsen and comScore about the logistics for replacing the current C3 ratings with a currency based on Total Audience Measurement.
At a time when more people are streaming videos and subscribing to over-the-top services, Total Audience Measurement includes more non-traditional viewing on connected TVs and other digital devices than the current system does.
“We’re hoping we can make Total Audience the currency in the next upfront,” Scanzoni says. “We have to go there.” Scanzoni pointed to the lower TV ratings for the Rio Olympics on NBC last month: “What’s happening here is people are watching content on their iPad. That’s not included. If they’re watching on a desktop, that’s measured as a digital play. And smartphone viewing is not included as part of the ratings.”
At this point the numbers are getting too big for the industry to ignore. “There’s 10-12% more audience if you factor in viewing on those other devices. The numbers are significant now,” Scanzoni said. “We have to move and be able to measure the content, not the device, and aggregate that audience.”
“We’re definitely moving forward,” agrees David Poltrack, CBS chief research officer.
Though some networks sell digital impressions separately, hoping to get premium pricing, increasingly the industry is buying and selling packages that include spots on both linear and on-demand platforms, increasing the need for a unified form of measurement.
Using a Total Audience measure would also help buyers by increasing the supply of impressions, which would tend to reduce the pressure pushing ad prices.
Scanzoni was one of the leaders in 2007 when the industry moved from using live TV ratings as the currency for buying and selling commercials to C3—which measures the average viewership of the commercials in a show whether it is viewed live or on a delayed basis for up to three days. (Now the networks say most of their upfront deals are based on C7, which includes seven days of delayed viewing.)
A new currency would have three big variables. One is which platforms are included, such as mobile phones, smart TVs and connected TVs. The second is how many days’ worth of viewing will be included. The third variable is trickier because it involves which spots are included in the ratings. Current rules only allow spots to be included when they appear in a program whose ad load is identical to when the show was originally broadcast.
In order to include a substantial portion of commercials, new, more flexible rules will be needed, Scanzoni says.
Poltrack wants the rules for counting ads to be flexible so that in on-demand programming, ads from C3 advertisers can be replaced after three days, while the impressions in that show still count for C7 advertisers.
“As more people are going to streaming and moving off the DVR, that will give us the opportunity to fully monetize something that’s only been partially monetized,” he says.
Poltrack adds CBS is researching the effectiveness of ads that run on other platforms to assure advertisers what they’re getting is “as valuable if not more valuable than the traditional ones they’re buying on live television.”
Nielsen last year introduced Total Audience Measurement as a way to track content, and networks and buyers have spent the year getting familiar with it. Measuring commercials across platforms is the next step.
“In regard to adoption of Total Audience Measurement, we’ve been encouraged by the momentum of the industry to evolve the currency metrics as a way to respond to the shifts in consumer viewing behavior,” says Megan Clarken, president of Product Leadership, Nielsen. “Nielsen’s role in the industry is to work alongside all industry operators to help define eligibility and crediting rules in order to provide currency metrics. Our Total Audience Measurement allows us to respond quickly to those decisions as they are being made,” Clarken adds.