• by Joe Mandese  @mp_joemandese, March 17, 2006

Big marketers dominating the food and pharmaceutical ad categories have long been pushing to find better ways of making their media more accountable and measuring the ROI on their marketing expenditures. Now two of the biggest, Kraft and Pfizer, are throwing their considerable weight behind a system that promises to correlate media exposure with product sales. Those marketers have joined four others, including packaged goods giants Procter & Gamble, Unilever and SC Johnson, to support Project Apollo, a joint venture of Arbitron and VNU to create what some have dubbed the "Holy Grail" of marketing and media research: a single-source system that measures both.

The inclusion of Kraft and Pfizer is interesting, because they are also major clients of Starcom MediaVest Group and Carat, respectively, two agencies that also both serve Procter & Gamble, the marketer that has taken the lead on Apollo. A sixth undisclosed marketer also is supporting the endeavor.

While neither Kraft nor Pfizer have officially announced their participation, their names were part of an invitation that went out to major media companies for a meeting Apollo is hosting in New York next week to update the media industry on the pilot project, which has already installed more than 5,000 households with product scanning technology from VNU's ACNielsen unit, and equipped more than 10,000 individuals in those homes with Arbitron's portable people meters. By tracking the media exposure of those individuals with the PPMs as they travel throughout their day, and correlating that with product purchases scanned by ACNielsen's Homescan system, the developers believe they can finally prove the cause and effect of advertising in an ongoing, syndicated database.

The push follows a series of disruptions at VNU that have cast some doubts on the future of Apollo, including the fact that the Dutch-based marketing and media research giant is in play. A group of private equity firms have offered $9 billion to acquire it, and are expected to break it up and sell off its pieces, which also include Nielsen Media Research. While that deal is opposed by some top VNU shareholders, another proposal by shareholders would bust up the company itself.

VNU maintains it is committed to Apollo regardless of its ownership structure, but the potential dissolution of ACNielsen and Nielsen Media Research raises an interesting question, as the media research unit has taken a more active role in marketing Apollo. Dave Thomas, senior vice president of strategy and development at Nielsen Media Research, has become the primary point person on the project.

But the media research unit also has sent mixed signals about its relationship with Arbitron, including taking a pass several weeks ago on an option to launch a joint media ratings venture based on Arbitron's PPM technology. While Nielsen said it may use the PPM as a form of out-of-home measurement to supplement its core ratings, it said after years of testing it was not confident that the PPM lived up to the rigorous standards it uses for its in-home TV ratings methods.

"Nielsen's decision not to enter into a joint venture with Arbitron to commercially deploy the PPM as a currency for television hopefully will not affect our collaboration with Arbitron on 'Project Apollo,'" Nielsen CEO Susan Whiting told clients during their annual meeting in Orlando this week.

"It is our opinion that the PPM does not satisfy the needs of a currency for television audience measurement - based on the technology, quality and granularity thresholds demanded of a currency service by both buyers and sellers in the television marketplace."

While Whiting added that she believes the PPM is still a "useful" application for marketing research, she said the technology and the Apollo panel "does not need to be projectable," something that might cause big marketers like Kraft, Pfizer and P&G to cringe, given the considerable sums they are investing in its development on the hope that it will be just that.

But executives familiar with the jostling between Arbitron and Nielsen say those statements have been chosen carefully in an effort by Nielsen to differentiate its ratings "currency" from a marketing research tool, which if successfully deployed, might cause some marketers to question the long-term need for ongoing media ratings.

"This is the classic difference between media and market research," says one insider. "Media researchers want data that is perfect and add little analysis or interpretation to it. Market researchers know the data they use is flawed and use it, with other information to converge on a solution."

Meanwhile, Apollo's developers will continue to market the service heavily to a broader cross-section of marketers, agencies, and especially the media community, whose active coding will help determine the success of the endeavor.