Premium Content, Best Measurement Metric: Just Follow the Money
Content ruled again this past week, as AOL shelled out a cool $315 million for the Huffington Post and Rupert Murdoch launched The Daily. What does this mean for those of us in the traditional TV business?
Hopes among the honchos at HuffPo are that Arianna's sprawling content network -- originally a counterpart to the Drudge Report, and now obviously much more -- will deliver the eyeballs AOL needs to satisfy the appetites of its advertisers.
Ignoring the rule that unidimensional celebrity brands are risky post-Martha Stewart, it was a bold move on Tim Armstrong's part, and one that could help give AOL a much-needed boost to revive its fortunes in the wake of its spin-off from Time Warner.
And then there was The Daily. News Corp's launch last week of the first and as-yet-only iPaper of record marked another high-profile premium-content play (albeit a subscription-based one). Say about it what you will, but I found The Daily to be a surprisingly intelligent marriage of content and technology. Could it use a little more substance? Maybe. But the touch-enhanced graphics and navigation make for a solid early entry.
All of which confirms something we've known in the TV space for a long time: Premium content is king, and premium content is, well, premium. (Just ask the VCs backing HuffPo.) And until now, TV has never been able to offer the same level of accountability for advertisers, although it has more than its fair share of premium content. Thankfully for buyers and sellers alike, that is rapidly changing.
As I've blogged in the past, some upstart firms are now bringing high-accountability solutions to market to fill the void left by Nielsen.
But some advertisers and agencies say that they are having a hard time differentiating among Nielsen's new competitors. And with all the new set-top-box data available, advertisers risk "analysis paralysis."
The question is, where should they start?
I suggest a straightforward solution: Start with the customer. In the case of the $70 billion TV ad business, the customer is, of course, the advertiser.
Think about it. Why do advertisers advertise? To sell more products. Yet there has never been a media-measurement solution to tell those advertisers whether the ads they run actually increase sales of the products they advertise. While there will always be some brand-building exercises (e.g., auto advertising), we live in a more transaction-based economy, and advertisers need to know whether their ads actually work.
Do the granular second-by-second ratings generated by millions of set-top boxes answer that question? No. Arguably they could even undermine the interests of the TV networks by showing fewer people watching or more rampant ad-skipping. (At the same time, though, they could help the long tail, which receives no ratings from Nielsen because of Nielsen's small panel size.)
So how can advertisers know whether their ads increase sales of the products they're advertising?
My answer: Borrow a page from the Internet playbook and provide advertisers with a means of advertising on networks, programs, and dayparts based on actual consumer purchase behavior as opposed to simply selling ads on the basis of the blunt instrument of age/sex demos.
This approach will allow those in the TV ecosystem to separate the wheat from the chaff of new measurement solutions and find the premium content that matters to them. And before we know, it the TV industry will approach the same level of accountability and implied value as Internet sites like HuffPo.