• by Joe Mandese , June 14, 2004

In a move that could lead to fundamental changes in the way TV ad time is bought and sold, a top media agency has thrown its sizeable weight behind a Nielsen plan to offer minute-by-minute ratings. The agreement marks another media research coup by Starcom MediaVest Group (SMG), an agency that has a history for being a first-to-market developer of new TV ratings systems. It also comes as SMG is coming down to the wire with four rival agencies for Procter & Gamble's coveted communication planning account. While it is unclear whether SMG's ratings breakthrough will hold any sway in the pitch, P&G has long been championing the development of a TV commercial audience ratings system.

The new Nielsen service would provide average minute ratings, and may ultimately evolve into a system that provides ratings for 30-second units that could be used to measure the audience flow of both TV programming and commercial intervals. The data would be made available via respondent-level data tapes that would plug directly into the data systems used by SMG and others to process Nielsen ratings.

Currently, TV ratings are based on the mid-minute of every quarter hour. Nielsen currently allows customers to conduct similar analyses through its so-called N*Power system, but that system is considered slow, cumbersome and expensive to use and most agencies do not consider it a practical solution to analyzing TV commercial ratings.

The new system won't be cheap either, and even with SMG's support, Nielsen will still need the backing of at least two other big clients - either major ad agencies, or TV networks - to move forward on the service.

While agencies have been most keen to develop such systems as a means of satisfying their clients' desire to become more accountable in their delivery of actual advertising exposures, only few of the biggest shops are believe to have the resources necessary to justify the seven figure-plus costs of the system. The payoff, however, would be a significant proprietary advantage over the rest of the market in terms of insights about the exposure and effectiveness of TV commercial audience delivery, as well as the audience minute-by-minute audience flow throughout programming and commercial breaks.

In fact, it's conceivable that no other agency would sign up for the system, giving SMG an exclusive position on Madison Avenue. WPP's MindShare and Interpublic's Universal McCann units are known to be interested in the service, but it's unclear whether they will move forward.

That would require at least two TV companies to step forward to provide the necessary support to make it a go. Among the TV networks, Viacom's CBS unit has been most keen in developing the service, but the recent fallout between CBS and Nielsen over Nielsen's local people meter plans is said to have created a wide chasm between the two companies in recent weeks.

But if one or more major ad shops were to gain access to the data, it likely would become an imperative for the major TV networks to also acquire it, lest they cede key insights to media buyers.

The data is part of a progression of new insights that could radically alter the way both buyers and sellers look at the flow of TV audiences. In August, Nielsen and TiVo will release the first of a new syndicated study based on the digital video recorder habits of a sizeable panel of TiVo subscribers. Next year, Nielsen will retrofit its entire TV ratings system to begin reporting TV viewing - as well as recording, playback, pausing and fast-forwarding - on digital video recorders in Nielsen's TV ratings sample.

All of these changes are expected to have a profound impact on the TV advertising marketplace, though the high-profile and politically-charged debate surrounding Nielsen's local people meter roll out has taken center stage in recent months.

Meanwhile, it's unclear what impact, if any, SMG's commercial ratings coup will have on the outcome of P&G's communication planning review. As important as the ratings breakthrough is, it is nonetheless considered a fairly "tactical" development relative to P&G's efforts to restructure its communications strategies. But the move does demonstrate SMG's innovation and willingness to develop a first-mover advantage over the rest of the marketplace. It also is reminiscent of a similar move SMG's Starcom unit made during the late 1990s, when it pushed Nielsen to develop the kind of ratings data necessary to run TV schedule optimizers, a development that was a requisite of P&G's media media buying review at that time. That AOR was assigned not to Starcom, but to MediaVest, which later merged with Starcom to form SMG."

But all of the agencies involved in P&G's communication planning review, including another incumbent, MediaCom, and three outsiders - Carat, MPG and direct marketing shop Targetbase - are believed to be pulling out all stops in the pitch, which will be decided in several weeks and which is expected to dramatically alter P&G's media plans, and potentially the entire advertising industry.