Measuring TV Ad Impact: New Services Permit Advertisers To Compare Own Ad Viewership With Rivals'

The competition is intensifying for better ways to measure the impact of TV ads. The recession accelerated a process that had already begun, driven by tighter budgets, competition from Google and other internet advertising aggregators and an increasing sense that too much marketing investment was being wasted.

The Holy Grail, which all advertisers and their service providers are pursuing is prediction: the ability to determine with statistically significant certainty what a consumer will buy based on quantitative behavioral analysis. Until someone grasps that Grail, interim measures are getting companies closer to the point where they can make resource allocation decisions with greater certainty about the marketing and financial impact.

Jessica Vascellaro describes in the Wall Street Journal what TiVo is doing to crack this market - and how Nielsen is responding:


The race for new ways to measure the impact of television commercials is heating up.

TiVo Inc. is expanding its service that allows advertisers to see how many and what kind of users are viewing their commercials. The company this week released a website that allows brands to compare viewership of their commercials with rivals.

The free site, tivo.com/ad-scorecard, allows anyone to enter three brands and see a chart plotting how much of their audience they retained during their commercials relative to other brands in their industry over the past several weeks. It shows that in a recent week, Verizon had slightly better-than-average audience retention for its commercials, while Sprint and AT&T were just below the average for similar advertisers.

TiVo is one of many companies ramping up their efforts to compete with television-measurement juggernaut Nielsen Co., arguing that as consumers' TV-watching habits change, the way companies measure and plan their commercials must, as well. Nielsen grew to dominate the television-ratings industry by reporting the size of TV-show audiences based on electronic meters hooked up to television sets, as well as surveys. But the growing penetration of digital set-top boxes that record viewership data directly is creating other opportunities that smaller companies are trying to seize.

TRA Inc., of New York, is seeing growing demand from advertisers and TV stations for its service that allows brands to measure what types of viewers saw their ads based on the products they buy. An advertiser can see whether its ad was viewed by people who already buy a lot of its product or that of a rival. An advertiser can also search for what types of shows are watched by frequent Pepsi purchasers or to see what kind of purchasers watched its ads.

The service matches data about what programs nearly two million households are watching from partnerships with TiVo and a major cable operator, against what items those households have purchased on frequent-shopper cards from undisclosed chain stores. The matching happens via data-collection group Experian; TRA doesn't receive any personally identifiable information in the process, Chief Executive Mark Lieberman said.

RentrakCorp., which has been historically known for its box-office ratings, and Simulmedia Inc. are also chasing the market. Rentrak combines set-top box data with data from an array of providers to generate audience reports such as how many people tuned in groups of ZIP codes, for example. Simulmedia can report how many viewers watching at a certain time are frequent watchers of animated TV shows, for example.

Advertisers and agencies say the new services aren't replacing Nielsen, whose ratings are the standard for TV-ad pricing and which also allow clients to study an audience by factors such as income, age and gender. But they are using the other providers more often for insights they say they can't get from Nielsen's data.

Brian Hughes, vice president of audience analysis for MagnaGlobal, a unit of Interpublic Group of Cos., says TiVo's second-by-second data has helped it analyze the effect that the timing of a commercial within an ad break has on how many people watch it. "It lets us get really close to the behavior of DVR users," he said.

The service is based on anonymous data from 375,000 TiVo households, which can opt out if they don't want their data included in the random sample. The company records every button pressed and click made by those units and compiles the data into buckets to show customers how many people view certain content at certain times.

"Nielsen continues to measure the world of what television once may have been, not the world of what television is increasingly becoming," TiVo CEO Tom Rogers saidduring an interview. The new TiVo website displays a sliver of data included in the company's wider subscription ratings service, which it has offered for years.

While Nielsen doesn't use set-top box data to determine ratings today, the company is "excited as anyone else" about its potential use and plans to start sharing the results of a test it has been conducting with the data in the next two months, said Steve Hasker, the company's president of media products and advertiser solutions. Nielsen's clients haven't requested the company use the set-top box data in ratings because such data is limited by the fact that not all homes have digital set-top boxes that can report data back, he said.

Nielsen has also begun to provide advertisers with data to help them measure whether their ads resulted in a purchase, using databases and a sample of people who scan what products they buy. But it is "early days," he said.