VNU, Arbitron Renew Quest For 'Holy Grail,' Join Single Media, Marketing System Using PPM

Even as its Nielsen Media Research unit hedges its bets on the promising new media technology for measuring TV audiences, VNU is moving forward with plans to develop a joint venture with Arbitron that would develop an ambitious national marketing research panel based on Arbitron's portable people meter system.

The new, as yet unnamed service, code-named Project Apollo (a loose acronym for Arbitron's Portable People Meter), which would collect media usage data about multiple media as well as product purchase data from consumer households, has already been endorsed by the nation's largest advertiser, Procter & Gamble, which dubbed it a "consumer-centric" measurement system.

"The consumer is boss at P&G," stated Greg Ross, director of P&G North America media & marketing. "This new research approach will help marketers learn more about how consumer media and shopping habits are changing. It offers the potential for a breakthrough in consumer understanding about how and when consumers are most receptive to brand information."

The concept of a robust, single-source measurement panel that could simultaneously measure media exposure and its affect on product purchasing patterns has long been the Holy Grail of the marketing and media industries. But with the exception of a few test market systems, none have proven economically viable.

Both Nielsen and Arbitron tried to develop such systems during the 1980s. In fact, Arbitron lost more than $100 million trying to launch a national single-source panel based on an older generation of household people meter technology, but it pulled the plug on that service, known as ScanAmerica.

Recently, Arbitron moved aggressively forward on ways to exploit the PPM technology beyond its tentative media measurement joint venture with Nielsen, and conducted a series of "pilot tests" for a national marketing panel, that was described as encouraging in the company's second quarter earnings release.

Those pilot tests, ironically, were conducted with Information Resources Inc., a major rival in marketing research measurement to VNU's ACNielsen unit. However, one insider pointed out that the deal with VNU "is not exclusive" and noted that other players could join the effort soon. "This is a development project. The next step would be a joint venture."

Assuming that came to fruition, the company would launch a national marketing panel comprised of 30,000 households and about 70,000 people in 2005. Details were not available, but the panel presumably would retrofit ACNielsen's existing household panel with the PPM technology, though one executive noted that ACNielsen's existing HomeScan single-source test market system would be subordinate to the new national marketing panel.

What other players might step forward wasn't exactly clear, but the insider noted: "This is not just a packaged goods play. We need other people to come in and get behind this." With P&G on board, the team already has a powerful endorsement.

Both companies emphasized that the service would be separate, distinct and designed very differently from any TV and radio ratings service developed with Nielsen (see related story in today's MediaDailyNews.)

But given the push toward return on investment (ROI) measures and away from conventional exposures-based reach and frequency measures, some leading thinkers believe a good single-source system could challenge, if not supplant conventional media ratings research.

Indeed, in a joint white paper presented at the prestigious 2004 ARF/ESOMAR Conference, Joan FitzGerald, director of new product development at Arbitron, and Tony Jarvis, former senior vice president and director of strategic insights at MediaCom, concluded that the Arbitron/IRI tests: "illustrate that exposure to advertising by behavior-based customer targets can be quantified and used to evaluate the efficacy of media advertising in achieving sales goals. Single Source research can be used to more effectively measure campaign results and refine future advertising strategies to more effectively reach behavior-based customer targets."

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