"There's a lot of enthusiasm in the industry to do this but it's not something that we or they want to rush into," said Stephen Morris, president and chief executive of Arbitron. "That would not be a smart idea."
Morris told financial analysts during a conference call Thursday morning that there isn't a timetable on when Arbitron or the outdoor advertising industry might begin regular ratings similar to the kind provided by Arbitron and Nielsen for television and radio. He said it might come down to cost for the $5.2 billion a year outdoor advertising industry.
"Ratings are very expensive, way more than this industry has typically paid for research," said Morris.
Arbitron is one of two companies that have been vying to provide ratings that will give the out-of-home industry a more reliable yardstick when compared to the other forms of media. Arbitron's system has been tested, while Nielsen Outdoors has tested its measurement methodology in Johannesburg, South Africa, and is poised to begin an outdoor-ratings system, not a test, in Chicago by the end of the year.
Morris said Arbitron has been explaining the "pluses and the minuses" of going with the regular ratings system, using the Atlanta data.
"If you have the numbers, you better be prepared to sell effectively with the numbers," Morris said.
Stephen Freitas, chief marketing officer for the Outdoor Advertising Association of America, said the industry understands the cost issue.
"Certainly it's going to cost more than the outdoor industry has been accustomed to paying, but the issue is how does this enhance the industry and the business we receive," Freitas said.
Freitas said it will be a long-term project for a new outdoor ratings service to take hold nationwide, and would likely happen piece by piece. But it would also be an improvement over the level of information that exists today, which takes into account the number of cars that go by a piece of outdoor advertising and then makes assumptions via ZIP codes and other data. The new systems, both from Arbitron and Nielsen, would provide demographic breakouts like other media is measured.
"Media planners and buyers need accurate audience information," said Nielsen spokesman Will Thoretz. "Up until now, they've had to rely on traffic counts and other studies that don't get them quite enough information."
Nielsen is moving ahead with its launch in Chicago by year's end. "We have commitments from a number of different sources and we're proceeding," he said. An Outdoor Advertising Council convened by Nielsen and made up of key players on all sides of the industry have provided input and provided some funding.
"We're producing a true ratings currency for the outdoor medium. The outdoor industry, as well as outdoor advertising, has long sough more accountability for the media. And we feel the ratings will provide the credibility and accountability to compete with other media like television and radio," Thoretz said.
Frietas said that while the outdoor industry is smaller than television and other media, it could potentially support two ratings systems. Arbitron is primarily looking at outdoor audience measurement domestically, while Nielsen is looking at it both domestically and internationally.
"We just don't know at this point how it's going to shake out," Frietas said.
Arbitron declined to put a timetable on its ratings system. Morris said that the next market could be Chicago but it's not certain.
"I don't think it's cast in concrete as to what the next market will be," Morris said.