Forget Ratings: Reach, Size, Commercial Share Will Be Next TV Metrics

Will the future of big media companies be all about scale and reach, and less about  the ups (and mostly downs) of individual networks and TV shows? We can only hope so.

Brian Wieser, senior analyst of Pivotal Research Group, says advertisers will increasingly look to ever-bigger packages of gross rating points for national TV advertising instead of say, individual advertising units in “Empire," “NCIS” or “The Voice.”

Worries about slowly declining TV ratings points on cable or broadcast shouldn’t be the focus.

“So long as networks have capacity to help advertisers meet their GRPs and reach delivery goals, the ups and downs of ratings have only a limited impact on ad budgets,” Wieser writes.

From the network perspective, they will continue to look for new ways to find higher value in those assets -- longer-tail VOD airings of non-skippable commercial and more time-shifted viewing of TV content.



Perhaps even more importantly, other analysts say TV networks will surely look for premium pricing when serving advertisers who want to link their first-party advertising data with traditional TV viewing metrics -- and offer guarantees on those strategic targets.

You can already see TV networks positioning to gain bigger premiums for their specific networks by pairing down commercial clutter.  Viacom started doing this for a few networks; Turner is doing this for truTV.

Why now? Some analyst believe TV networks have few tools left to find higher premiums.

Wieser believes looking at actual commercial audience share changes are strongly correlated with revenue share changes and are a better metric in figuring out where big TV media companies are going than individual ratings.

Why? In part, he notes that reported TV ratings are different from ratings that are guaranteed to advertisers. Also national TV advertisers sometimes shift media budgets from, say, broadcast to other venues -- such as cable TV networks. This doesn’t seem to be because of changes in ratings, but because of access to lower prices.

He adds that TV marketers can still be moved because of the medium's ease and scale:  “We have observed that media planners tend to allocate shares of budgets to specific media owners with some mindfulness towards the share of inventory that a given media owner possesses.”

Will “Big Bang Theory” do well next season? Or “Quantico”? Or “Brooklyn Nine-Nine”? Look for more media buying/advertising executives to be shrugging their shoulders at those questions.


3 comments about "Forget Ratings: Reach, Size, Commercial Share Will Be Next TV Metrics".
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  1. Rod Ellis from Adams Outdoor Advertising , May 31, 2016 at 4:51 p.m.

    This is nothing new. Bad television stations have been selling households forever because they had no particularly strong audiences in the demos. It's time for agencies to step up and find creative alternatives to help their clients reach their potential customers and demand that stations charge what they are really worth. The fact that networks would try to sell advertisers a households buy at a premium is ridiculous.

  2. Ed Papazian from Media Dynamics Inc, June 1, 2016 at 1:42 p.m.

    Weiser is right when he states that individual show ratings are not a major factor in most packaged multi-show buys. He is also correct in contending that the sellers will charge premiums for the use of add-on "qualitative" or marketing-driven metrics as a buying tool. This is so because "linear TV" ---despite continued rating fragmentation---continues to offer TV message fixated advertisers the only way to attain mass reach with their commercials. As for audience fragmentation, this is hardly a TV exclusive. Radio certainly has it as do digital video venues, which, individually, reach small average commercial audiences and have severe reach issues due to ad blocking.

  3. Ed Papazian from Media Dynamics Inc, June 2, 2016 at 9:55 a.m.

    Rod, the basic audience "currency" for network TV buys remains people ratings but these are being "refined" via indexing, based on various qualitative factors that supposedly define viewer engagement as well as household-based product buying and "viewing" metrics obtained from independent sources. The latter are very questionable as the "viewing" correlation comes from household set usage data derived from "big data" set-top-box panels, which present a very poor indication of whether or not the intended human target of the ads was watching. Their main plus is a very large sample but that is absolutely no guarantee that the resulting information, as it is being utilized, is valid or even useful.

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