WPP On Track With Rentrak: Cuts Deals To Sell Kantar, License Ratings To GroupM

by Joe Mandese , October 9, 2014

In two big deals involving divisions of the world’s largest advertising company, WPP, Nielsen rival Rentrak appears to be accelerating its momentum in the U.S. TV measurement marketplace. In one deal, Rentrak said it agreed to acquire the U.S. TV measurement operations of WPP’s Kantar Media unit for $98 million in Rentrak stock. In the second deal, it said WPP’s GroupM unit has signed a deal to begin utilizing Rentrak’s national and local TV audience measurement services.

The WPP deals follow some important recent milestones for Rentrak, including a decision by Publicis’ Zenith Media unit to begin utilizing Rentrak’s data as actual trading currency for advertising deals with local TV stations. While the Zenith deal initially only involves three undisclosed TV advertising markets, the agency said it is optimistic that it will expand it to other TV markets after its clients have had an opportunity to review results of the real market test.

WPP’s GroupM didn’t go as far as to use the term “currency” in conjunction with its plans for using Rentrak’s data, but it certainly implied that possibility among TV networks that are currently unmeasured or TV markets that are under-measured by Nielsen’s “legacy” currency.

“Rentrak’s data will be used to quantify viewing levels in more than 200 networks that are not currently measured by the legacy sample currency, as well as in local markets where today’s diary measurement has been less than stable,” GroupM said in a statement announcing the deal.

Nielsen recently announced a deal with audience-based TV advertising platform Simulmedia to figure out a way to measure niche cable networks that currently are not measured in Nielsen’s current national TV ratings sample, but not specific methodology or time frame have been announced for that.

“The proliferation of channels has so significantly fragmented audiences that legacy sample methodology simply can’t keep up,” GroupM Global Chairman Irwin Gotlieb said in a statement released early this morning. “Television measurement needs to move toward census-based methodology. Our agencies are doing such refined targeting and segmentation, and that work can only be supported by census data. It is our hope that we can act as catalysts in moving the industry toward greater data reliability and accountability.”

GroupM, which claims media billings of more than $105 billion worldwide, includes media agencies such as Mindshare, MEC, MediaCom and Maxus -- which collectively are also the biggest buyers of TV advertising time in the U.S.

Meanwhile, Rentrak said the Kantar acquisition will also boost its coverage of U.S. media buyers, because the deal includes the assumption of Kantar Media’s “customer contracts and customer relationships involved in U.S. television measurement.”

“This transaction gives Rentrak and Kantar better scale to rapidly innovate their products and services in the United States,” the company said, adding that the deal does not involve Kantar’s operations outside the U.S.

agency, audience measurement, media measurement, ratings, tv

2 comments about "WPP On Track With Rentrak: Cuts Deals To Sell Kantar, License Ratings To GroupM".

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Ed Papazian from Media Dynamics Inc, October 9, 2014 at 9:19 a.m.
The implication in this and similar stories is that Nielsen is in big trouble and that it may lose out to Rentrak in the TV rating business. While Rentrak seems positioned to offer some interesting additional coverage----small market TV and small audience digital cable channels, for example----- we're not talking about a lot of ad spending on such "networks" or stations, at least by national advertisers. I don't see the slightest chance that Nielsen's position as the only supplier of TV rating "currency" for the Broadcast TV networks, syndicators, the top 100 cable channels, and TV stations in the top 75 markets, is at risk----barring a total breakdown in Nielsen's service. This is not to say that serious questions are not developing about Nielsen's plans regarding cross-platform measurements, various proposals to ascribe or simulate audience data rather than measuring it, etc. And the situation regarding small TV market ratings is certainly deplorable. But, to be fair, if small market TV stations can't afford to fund bigger samples and electronic measurements such as are provided by peoplemeters, who is going to pay for them? Will national advertisers, who rarely go this far down in the market rankings for spot TV buys foot the bill? Of course not. Will local advertisers pay for better rating measurements? I doubt it. So, is Nielsen expected to operate small market rating panels at a loss---as a public service? That's up to Nielsen, but I can see why a business, which is what Nielsen is, would not want to carry that load forever. It's fine to keep the pressure on Nielsen, as some of the large agencies are doing, as this may eventually lead to some sort of accommodation between Nielsen and Rentrak, whereby the latter does handle channels and stations which require larger samples and Nielsen supplies it with a way to estimate viewing data. But let's not get all in a dither and fear that this is the beginning of the end for Nielsen. Remember the situation in the mid-1980s when Audits Of Great Britain was trying to sell its peoplemeter idea to the U.S. and Nielsen was resisting. After a while, Nielsen, got the message, did a lot of testing, and came out with its own peoplemeter design. I suspect that it will respond in much the same manner, now.
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Suzanne Sell from Independent, October 9, 2014 at 1:41 p.m.

Right on the money, Ed!