In Netflix, Disney+ & HBO Max face the question, "What constitutes an impression?", I wrote “there may be real value in the impressions data from [Connected TV (CTV)] streaming; but, that data will have limited upside without the ability to tie it to individuals within households.”
I learned at the Cynopsis Measurement & Data Conference earlier this month that there are multiple challenges to tying data to individuals:
In digital, data can be tied to the subscriber, but is otherwise imprecise;
Addressability in linear advertising can go national, local, DMA, street, person but otherwise unable to get more granular within household (e.g., who is and isn’t watching the TV set); and,
Every household has very different purchase behaviors and every person within each household has different purchasing behaviors.
All of these point to the “attribution gap” between (1) where people learn about products, services and brands, (2) which members of the household were impacted by the ad impression, and (3) the mediums where they actually do the shopping and the buying.
The looming question for CTV is which data advertisers and sellers can agree upon to help build a data story for that attribution gap. The sense is that Nielsen has fallen out of favor, but after the past few weeks, that outcome seems less certain.
Nielsen & Measurement
Reporting from upfronts suggested that advertisers were seeking alternative third-party measurement metrics or “currencies” to Nielsen. But, currencies got “just a nod during the upfronts.” Adweek reported that Nielsen is still the standard in the 2022 upfronts:
For the most part, marketers previously told Adweek, this year’s upfront negotiations will mostly be business as usual when it comes to measurement, with some exceptions (Horizon Media said it plans to transact up to 15% of its upfront investments using alternative currencies). In this upfront, the TV industry will still largely transact against Nielsen’s C3—and in some cases C7—ratings, according to executives across several major holding companies, but more seismic changes are coming in 2023.
[NOTE: C3 and C7 ratings track the number of viewers who actually watch commercials over three or seven days.]
A “currency” is an independent third-party measurement standard agreed to by both buyer and seller to confirm the delivery of an ad impression, and around which both buyers and sellers transact.
Nielsen has fallen out of favor for a number of reasons recently - in part because it was stripped of its national and local TV ratings services’ accreditation by the Media Rating Council. But mainly because newer measurement services like iSpot.tv offer real-time audience measurement, ad verification and campaign analytics platforms; Innovid’s TVSquared offers cross-platform measurement and attribution across devices and publishers; and, other services like EDO measure the outcomes resulting from convergent TV advertising campaigns.
Nielsen’s growing challenges in CTV were summed up in this quote to AdWeek from Kirk McDonald, CEO, GroupM North America: “Marketers are leaning into new tools and technologies to bridge the measurement gap, raising important questions about the accuracy and sustainability of panel-based measurement as changes in the digital media environment continue to accelerate beyond one currency.”
In other words, the ad-buying community believes that there are better data and measurement solutions emerging than Nielsen to close the “attribution gap”.
Nielsen & Data
There is a counterargument to this belief, perhaps best laid out by technology analyst Benedict Evans a recent opinion for The Financial Times ($ - paywalled): “data is not one thing, but innumerable different collections of information, each of them specific to a particular application, that can’t be used for anything else.”
In the case of currencies, the question is to what extent data from new measurement currencies solves existing pain points, and the extent to which they create new ones. A recent study from GroupM and iSpot.tv ($ - paywalled) found 17% of advertisements shown on televisions connected through a streaming device—including streaming boxes, dongles, sticks and gaming consoles—are playing while the TV is off. The study also found that, on average, between 8% and 10% of all streaming ads were shown while the TV was off.
In this case iSpot.tv proved its value proposition of ad verification. But, in having done so it also flagged the question of the reliability of data from across a variety of vendors in an ecosystem of TV manufacturers, connected devices, media companies, apps, buyers, and measurement companies. In other words, perhaps there are still advantages to Nielsen’s approach.
That was the argument of Nielsen’s Chief Data and Research Officer Mainak Mazumdar in a recent blog post:
…big data is reflective of devices, not of actual people. The data by itself can’t tell you who’s watching and who’s not—which is a fundamental need for advertisers. And when people are removed from the equation, the numbers just won’t add up.
Unsurprisingly, Mazumdar included a sales pitch for Nielsen in the post, too:
In order for big data to truly represent the U.S. population, every TV household would need to have the exact same TV set and access programming through the exact same data stream. That’s why all big data sets need to be level set—calibrated—with people-based panels that reflect the diversity of the U.S. population.
Notably, his argument is not for Nielsen to win at the expense of the competition. Rather, it is that the emerging competition in currencies will need Nielsen to help flesh out which members of the household are making which purchasing decisions.
After Nielsen's brutal beginning to 2022, that seemed unlikely as an outcome. But now it seems inevitable. The bullish story for big data in CTV advertising seems vulnerable.
Must-Read Monday AM Articles
* Roku is launching a shoppable ad pilot program on its streaming platform with Walmart, the world’s largest retailer, allowing viewers to purchase products directly from their TV screen.
* Innovid announced the launch of InnovidXP, a cross-platform, tag-free measurement solution delivered to more than 95 million households.
The Vibe Shift
* McKinsey published a report on “the real business” of the Metaverse
* "Why the Metaverse will be Epic” from former NBA and ESPN digital executive John Kosner
* The Verge dove into the “hype and hustle” at entrepreneur Gary Vaynerchuk’s NFT conference
* Common metrics such as reach, frequency and impressions tell marketers nothing about advertising effectiveness. Attention is the metric that matters.
The 200 vs. The 10 Million
* NBCU’s and Paramount’s upfronts reflect “a somewhat softer market for TV.”
Aggregator 2.0 & Bundles
* N/A
Sports & Streaming
* N/A
Creator Economy, Platforms & Transparency
* Why a rap from a 52-year-old British American documentary filmmaker “with a bookish, somewhat anxious demeanor” has gone viral on TikTok and YouTube ($ - paywalled)
* TikTok is the town square now
* MTV turned music into spectacle. TikTok is doing the opposite.
* YouTube recently revealed that 1.5 billion logged-in users now access YouTube Shorts each month and that “Shorts is helping invigorate a creator’s existing channel or inform a new content strategy”
* A positive take on Spotify’s investor day, where it outlined its ongoing pivot to podcasting
Original Content & “Genre Wars”
* Execs reported business affairs-related difficulties when establishing how much is on offer for a particular show during contract negotiations with Netflix, “a reversal of the era when Netflix was seen as very much a blank-check company.”
* The Wall Street Journal’s Joe Flint went deeper into the background of new chairman of Walt Disney Co.’s General Entertainment Content unit, Dana Walden. ($ - paywalled)
* Wired’s Jason Barham argues, “to the average consumer, streaming companies have maneuvered with what appears to be only rapid growth and blind excess in mind. Sure, we reap the fruits of that near-impossible ethic, but is it what we want—or even need?
AVOD & Connected TV Marketplace
* As Roku becomes more like TV, some partners say it’s abusing its power
* The Wall Street Journal reported a bullish market for FASTs
* Pluto TV is set to expand into Canada this fall in partnership with local broadcaster Corus Entertainment
* Verizon dropped the cost of its entry-level Fios and fixed wireless Home Internet plans to $25 per month and offering a four year price lock for fiber customers on its faster 1-gig and 2-gig tiers.
* AVOD services are gaining popularity across the United States much more quickly than their subscription VOD (SVOD) counterparts, according to a study by Comscore.
* Warner Bros. Discovery plans to shrink the global ad sales force by as much as 30% ($ - free registration required to view)
Other
* The Danish government has recently approved a 6% tax on streaming services, making it the first Nordic country to implement such a levy, and streamers like Viaplay oppose the new tax.
* Comcast CEO Brian Roberts “is itching to pull off a statement-making move”, but analysts believe that the timing might not be right for that kind of a deal.
* Variety VIP’s Andrew Wallenstein argues Disney is being bogged down by a series of unforced errors by CEO Bob Chapek ($ - paywalled)
* A good interview with Dotdash Meredith CEO Neil Vogel