• by Ed DeNicola , Op-Ed Contributor, May 8, 2023

Have you ever played cards or been in a negotiation and have had either a bad hand or no leverage? It can be very frustrating.

If you have been in one of those situations, you may have made a strategic decision to “bluff. If your bluff is believable enough and you’re able to sell it well, it can be a very effective strategy. Even the hint of competition can be enough to produce a good result.

Going with theme of cards, let’s call a spade a spade, when it comes to selling, the TV networks have no equal. They can sell like nobody’s business. You simply need to look at the revenue numbers.

In addition to having outstanding salespeople, the TV networks have excellent researchers. Many have gone back to school for additional data science training. Some of the networks employ data scientists in addition to researchers.

TV researchers and data scientists should understand the differences between a probability sample, a census and a convenience sample and know which methodologies would provide the best TV measurement.

If all of this is true and it’s obvious – to me, anyway –  that the “alt” research companies’ convenience samples are not as well suited for currency TV measurement, then what’s all the fuss? Why is there a need for a JIC to certify them?

It’s all a bluff. And the TV networks are selling it the best way they know how – via upfront-style pitches. Who would ever question the viability of an endeavor that includes so many of the largest and most prominent players in the industry. It’s, as they say, too big to fail.

The JIC even gives the appearance of an all-inclusive and representative undertaking that comprises both the buy- and sell-sides of the TV business. However, if you look deeper, the buy-side only includes ad agencies. There are no advertisers.

The fact is that the TV networks and ad agencies are aligned in that they’re both similarly compensated based on delivering the best numbers, not necessarily on which numbers are best.

The networks charge more when they deliver more impressions, and the media agencies earn more as they take a percentage of the ad spend. The advertisers pay more when numbers are high.

The TV networks aren’t entirely to blame for their behavior. It’s an outgrowth of the hand they’ve been dealt. They’re at a loss for a better strategy.

Nielsen needs to take some responsibility, as well.

Nielsen has made mistakes because of circumstances that may or may not have been beyond the company’s control that have financially harmed its clients’ businesses at a time when the TV business itself is struggling due to new digital competition from streaming services.

If Nielsen wants the JIC (joint industry committee) to go away, it could make some changes to the way it does business.

Careful not to violate any non-disclosure agreements, any Nielsen client would know that the company’s contracts and pricing structures do a better job of accommodating nascent or fledgling networks that are building their businesses than they are at providing fair pricing for established TV networks whose businesses are in decline.

Nielsen prices will go down for some things if TV networks begin to underperform, but not for where it counts most. Moreover, Nielsen doesn’t have to give back money when it makes a mistake.

The result of this is that while the TV networks are struggling financially, for the most part Nielsen is still costing them a similar amount. Nielsen expenses can be significant. Holding companies with a lot of TV networks have corporate contracts that value in the hundreds of millions of dollars. The stakes are very high.

It will be interesting to see if Nielsen blinks and falls for the bluff. Considering that it has chosen not to participate in the JIC certification, it doesn’t appear to be taking the bait.