The 2013 upfront will be the first year when a common currency — Nielsen Online Campaign Ratings — are available for both television and online video. We’ve already heard major media companies embracing a unified selling approach. For instance, ABC announced that it will use Nielsen OCR to measure viewing across both television and online sites and will offer audience guarantees based on total viewing across all devices.
Much has been written about the benefits this would offer advertisers, but scant attention has been paid to just what this would mean for media companies and their online publishing arms.
At first glance, this seems like a logical win-win scenario for both. Advertisers will now get to realize holistic audience-based campaign targeting across platforms, and publishers will now have a legitimate chance to finally grab long-awaited, highly coveted shares of upfront television budgets.
On second glance, however, there is a troubling challenge lurking beneath the hopeful enthusiasm. According to our parent company Videology, Inc., 80% of digital video RFPs now include a Nielsen Online Campaign Ratings element — and it’s likely to grow even higher during the upfront. While television networks are equipped to manage inventory based on decades of Nielsen-based modeling, most publishers have virtually no tools available that would allow them to adequately forecast against the new ratings verification system.
When publishers sell their inventory with audience guarantees, they don’t get paid for those impressions delivered out-of-demo. To determine demos, publishers use first-party or third-party data providers to identify their audiences and deliver targeted impressions to advertisers. Yet for campaigns utilizing digital ratings such as Nielsen’s for demo verification, a publisher’s performance is then measured by age/gender criteria from a different source. This could potentially lead to differing classifications of a single impression between the publisher’s data and the ratings provider’s data, with impressions previously considered a part of the advertiser’s target now being declared out-of-target. This discrepancy would of course diminish publisher revenue top lines, and make forecasting and inventory management extremely difficult.
This uncharted territory could lead to tremendous inventory deficits – or, if played too conservatively, inventory surpluses that could mean millions in lost revenue opportunities during this year’s upfront alone. In fact, our initial testing showed that OCR verified campaigns could require almost double the number of served impressions to meet a given demo guarantee.
The upcoming television Upfront season offers the best opportunity that we have seen so far for digital video to take a major leap in garnering significant media spend allocations. But to sustain these gains, we will need to ensure that all parties within the ecosystem can thrive within the “video is video” world—including the publishers.
A predictive technology that bridges the gap between what publishers think they are delivering, and what providers like Nielsen say they are delivering, is an urgent albeit unconsidered need within our industry.