Commentary
Forget Ratings: Reach, Size, Commercial Share Will Be Next TV Metrics
- by Wayne Friedman , Staff Writer, August 5, 2016
Brian Wieser, senior analyst of Pivotal Research Group, says advertisers will increasingly look to ever-bigger packages of gross rating points for national TV advertising instead of say, individual advertising units in “Empire," “NCIS” or “The Voice.”
Worries about slowly declining TV ratings points on cable or broadcast shouldn’t be the focus.
“So long as networks have capacity to help advertisers meet their GRPs and reach delivery goals, the ups and downs of ratings have only a limited impact on ad budgets,” Wieser writes.
From the network perspective, they will continue to look for new ways to find higher value in those assets -- longer-tail VOD airings of non-skippable commercial and more time-shifted viewing of TV content.
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Perhaps even more importantly, other analysts say TV networks will surely look for premium pricing when serving advertisers who want to link their first-party advertising data with traditional TV viewing metrics -- and offer guarantees on those strategic targets.
You can already see TV networks positioning to gain bigger premiums for their specific networks by pairing down commercial clutter. Viacom started doing this for a few networks; Turner is doing this for truTV.
Why now? Some analyst believe TV networks have few tools left to find higher premiums.
Wieser believes looking at actual commercial audience share changes are strongly correlated with revenue share changes and are a better metric in figuring out where big TV media companies are going than individual ratings.
Why? In part, he notes that reported TV ratings are different from ratings that are guaranteed to advertisers. Also national TV advertisers sometimes shift media budgets from, say, broadcast to other venues -- such as cable TV networks. This doesn’t seem to be because of changes in ratings, but because of access to lower prices.
He adds that TV marketers can still be moved because of the medium's ease and scale: “We have observed that media planners tend to allocate shares of budgets to specific media owners with some mindfulness towards the share of inventory that a given media owner possesses.”
Will “Big Bang Theory” do well next season? Or “Quantico”? Or “Brooklyn Nine-Nine”? Look for more media buying/advertising executives to be shrugging their shoulders at those questions.
Editor's Note: This post was originally published in an earlier TV Watch column.
Wayne Friedman is West Coast Editor of MediaPost. You can reach Wayne at wayne@mediapost.com.
Wayne, I'm having a bit of trouble relating the headline of this piece to what Brian is quoted as saying. He seems to be saying that overall GRP tonnage at the lowest cost will, increasingly take precedence over buying specific shows, which is nothing very new. But he's referring to average commercial minute ratings---no matter how they are calculated----not share of audience, reach or size. Share of audience would be impossible to use as the base----total viewers for all TV shows on at the same time----varies by time period. CBS may average only an 8% share of audience in primetime while attaining a 15% share in some other daypart, but the number of viewers ---or its average minute rating--- in primetime will probably be considerably larger as so many more viewers are watching TV.
As for reach, TV sellers would love to guarantee based on reach not GRPs. Reach for a given schedule is easier to attain than the total number of GRPs as the latter goes to audience tonnage---frequency. Unfortunately, many TV buys ---upfront as well as scatter---are corporate purchases not for individual brands.Hence, at the time of the negotiation between buyer and seller, the brand allocation is not a part of the equation. This comes later. The only way a brand could be quaranteed a certain level of reach would be for it to buy separately---a situation that would greatly benefit the sellers but, at the same time, create havoc. Now, instead of buying fof 20 large corporations an agency would be buying for 300-400 separate brands, thereby losing any clout it has by virtue of their combined corporate budgets and vastly increasing the buying burden. Sellers, too, would be hard pressed to keep up with so many small negotiations.
Thanks Ed. I was scratching my head also connecting the headline to the article. You saved me having to reread the piece.