After years of mulling concepts like attentiveness, involvement, and engagement as a means of measuring the impact media buys have on advertising effectiveness, Madison Avenue is officially embracing "engagement," as its new media planning metric - one that could replace the vaunted concept of "frequency" as the multiplier in most media plans. But a panel of advertisers and agency executives discussing the move Wednesday during a closing panel session at the Association of National Advertisers' 2005 Marketing Accountability Forum in New York had a difficult time defining exactly what the new metric would be, how it would be applied, or whether it would be done so consistently across all media. "I actually came here to hear the answer to that," quipped Bob DeSena, managing director-Mars Direct at packaged goods marketers Masterfoods USA, and a member of a task force organized by the ANA, the Advertising Research Foundation and the American Association of Advertising Agencies to lead an industry-wide initiative that would adopt "consumer engagement" as a media metric that would complement traditional measures of media exposure. But while the panelists agreed that engagement would likely be used as a complement for one core media planning measure - audience reach - they implied that engagement would supplant the concept of frequency, or the number of time a consumer is exposed to an ad. "This is the effectiveness index now," said DeSena. Beyond that, there seemed no consensus among the panelists, which also included Procter & Gamble Manager of Information Technology Research Organization Ted McDonnell, Grey Interactive Managing Director Norman Lehoullier, and Starcom MediaVest Group Executive Vice President-Global Research Director Kate Sirkin, about how to define it as a common currency, or whether it even could be. They all agreed, however, that the move was being driven by two factors: The clutter of advertising media that is making simple exposure to an advertising message irrelevant; and the emergence of digital, interactive media capable of demonstrating consumer engagement. The big question, said Grey Interactive's Lehoullier, is whether all media should be treated on the same basis in terms of engagement, something he said the industry has been doing to the detriment of media that are more engaging. "We have the ability to measure the depth of engagement with the media we have available today," he asserted, "but we treat them all the same." "It's a real challenge to find the right metric that works across all these things," added SMG's Sirkin, noting that her agency has been working closely with the magazine industry, with online media outlets and with branded entertainment developers to develop measures of engagement that are unique to each of their businesses. While she implied it was unlikely that a single, common denominator of engagement could be applied equally to all media, she said it should not impede any medium from moving forward with the metric as a basis of advertising effectiveness. In fact, she noted that SMG already has negotiated two of its 2005-06 network TV upfront advertising deals with audience guarantees that are somehow tied to measures of engagement. Those deals she pointed out were not done with the biggest players, like ABC, CBS and NBC, but with two more entrepreneurial TV networks: Court TV and The Weather Channel. The one common thing about the concept of "engagement," concluded Grey Interactive's Lehoullier, is that "everyone likes it. "The problem," he added, "is when you try to define it."
While some radio broadcasters have been wary about the potential impact of portable people meters (PPM), Arbitron's new means of monitoring radio listenership, could lift radio revenue far beyond its current level and provide the industry with more reliable data than is now available, a study presented by the Radio Advertising Bureau concluded. Presented at a press conference in New York City, the RAB's "Economic Impact Study of the Portable People Meter" concluded adoption of the PPM could make a sizable difference in radio spending and open a window for far greater potential revenue growth. The PPM, fully deployed, would potentially lift radio ad revenues $696 million over what they are with Arbitron's current diary method. Continued use of the diary method, meanwhile, could spell a fall in radio revenues, the study warned. Coming on the heels of an analysis by the RAB-PPM Task Force released last week, which found that corruption of PPM data is "virtually impossible," the new study--which was funded by Arbitron itself and conducted by Forrester Research--appears to indicate that support for a new method of listener tabulation is growing greater still. "The confidence in the current diary system has eroded tremendously, and the radio industry is at potential revenue risk if it continues to be a diary-only industry," said David Pearlman, President of Pearlman Advisors, which spearheaded the project for the RAB. "The advertising community is clamoring for a better measurement system." Forrester arrived at the $696 million figure via an economic modeling system, taking into consideration additional revenue projected by adoption of the PPM system and the loss of dollars that would potentially take place if the industry stayed with the diary system. Some industry observers, however, expressed caution, saying that although the advertising community was by and large behind the adoption of the PPM, some of the study's monetary projections--based on highly changeable future predictions--were premature. "It's very preliminary, as nobody knows what the marketplace conditions will be if and when the PPM is up and running," said Brad Adgate, senior vice president for research at Horizon Media, a private media services company based in New York. "It's also somewhat looking at radio as an isolated situation [but] clearly, there's increasingly more choice as to where advertisers place their dollars." In tests, the PMP was able to identify 59 percent of total radio sessions in environments of varying levels of noise, falling within a goal of being able to identify between 50 percent and 70 percent.
In what could be a bellwether for traditional media outlets like TV migrating to more interactive, Web-like platforms, consumers are spending more time visiting content and communications-related sites online, while decreasing the proportion of time they spend with so-called e-commerce sites. At least that's the conclusion of the June edition of an ongoing tracking study released Wednesday by the Online Publishers Association. The OPA, of course, represents the kind of traditional media content companies - big papers like The New York Times and The Wall Street Journal - who presumably are driving that shift. According to the OPA's June "Internet Activity Index," online users spent an estimated 557 million hours last month visiting content sites, including news and entertainment pages such as CNN.com, MapQuest, and Windows Media Player--up from 536.4 million hours in May and 500.8 million in June of 2004. Time spent at content sites represented 36.9 percent of all online time in June--a slight increase from both May's 36 percent and 36.5 percent in June of 2004. Of the categories posting declines, search engines showed the bigger loss, with consumers spending just 4.3 percent of all online time, or 65.4 million hours, on search. The month before, time spent at search engines amounted to 4.7 percent of all online time, or 69.9 million hours; and, in June 2004, search represented 4.4 percent of online time, which came to 60.5 million hours. Consumers spent 17.5 percent of their Web time at e-commerce sites--down from 18.4 percent in May, but up from 15.7 percent in June of 2004. All together, consumers clocked 263.1 million hours at online retail sites last month, compared to 273.9 million in May and 215.9 million in June of 2004. The report was compiled using data from Nielsen//NetRatings.