“We have a problem. You know it, I know it, we all know it."
That’s how Linda Yaccarino, chairman of advertising sales and client partnerships at NBCUniversal, greeted participants at a summit she organized earlier this week in New York City to talk about issues in TV ad measurement.
Most of us who work in TV advertising could or would have said exactly the same thing, although I would put a bit of a twist on it. Current TV ad measurement is indeed problematic, but it not the problem. It is a symptom of a bigger problem: While TV has changed massively over the past decades, how it is bought, sold and measured hasn’t.
If we look back over the past 30 years, TV viewing has changed substantially, as have the needs and media alternatives of most advertisers. So too, have all of the technologies that can drive, control and measure most other forms of advertising. Finally, the choices and behaviors of all consumers have also radically changed.
Unfortunately, how TV ads are planned, bought, sold and measured has changed very little. If Rip Van Winkle was in TV advertising and awoke after a three-decade snooze, he wouldn’t skip a beat when he went back to work. He’d recognize virtually everything.
As has been reported from the summit, one of the biggest issues is that we have stretched the industry’s core measurement beyond its limit. Measurement of TV audiences at the campaign level according to gross rating points and broad sex and age demographics just doesn't cut it anymore, unless these metrics are complemented by much more granular measures related to outcomes like purchases, return on investment, and person and household level reach and frequency.
This is what advertisers now expect from their digital advertising. It is what TV must provide, too, if it wants to continue to garner significant budgets in the future.
Why aren’t measurements like this used today for the vast majority of TV ad buys? Not because it’s not technically possible. It certainly is. It’s not because Nielsen and other measurement companies don't do it. They certainly can, and are developing digital-like measurement products for TV advertising.
It’s not happening today because the majority of TV advertisers and their contracted media buyers haven’t made it a priority or committed to the process. Buying on purchase metrics is viewed as anathema to most large TV brand advertisers. Most believe they would be selling their souls if they prioritized ROI performance over buying content and day-part placements alone.
Further, using those metrics could mean that marketers -- certainly those that are not digital-first brands -- would need to shift away from the procurement and cost-center management focus that most operate under today.
We need to realize that “performance” in TV advertising is not a four-letter word. I believe we will only get the TV advertising measurements that we need in the future if we can make industry members, especially advertisers, think of their TV advertising with the same mindset of performance and ROI that they apply to their digital and promotion expenditures -- and not just as part of an annual marketing mix modeling exercise, but proactively and tactically as they plan, buy, measure and optimize their TV advertising.
Thank you, Linda Yaccarino, for carrying the torch for TV advertising’s future. Are the rest of you out there ready to help drive the change we all need?