Special to TelevisionWeek
Arbitron has been testing its portable people meter for several years now to gauge its readiness to serve as a next-generation audience measurement device. And it just may be deployed nationally within the next year, but not in the way you might think.
Instead of launching as a ratings service (or part of one), it will more likely debut as a media planning tool that is used by advertisers to track what consumers purchase after being exposed to TV, radio and Internet ad campaigns.
The planning tool, dubbed Project Apollo, would marry the PPM with ACNielsen’s Homescan service, which tracks consumer purchases via Uniform Product Code technology in a panel of nationwide households. If the service does go forward, it will be the first so-called “single source” measurement tool (tracking both audiences and their purchases) since the shuttering of Arbitron’s Scan America service in the early 1990s.
The service could launch within a year, said Michael Connors, president of VNU Media Measurement Group, the parent company to Nielsen Media Research. But to go forward within that time frame, advertisers have to step up with financial commitments of $50 million to $100 million.
Arbitron and VNU have been discussing a possible joint venture to bring Apollo to market for several months now and have been out in the market trying to convince advertisers to sign on. Mr. Connors said he is optimistic that enough advertisers will commit and that the companies will be able to announce the project as a go by the end of the first quarter. If advertisers step up by then, the Apollo project could be launched as early as October 2005.
Apollo would cost $100 million to bring to market, Mr. Connors told TelevisionWeek. And VNU and Arbitron want advertisers to cover “significantly more than half” of those expenses to move forward with the project.
While there appears to be significant support for the concept, some industry executives believe the timetable is unrealistic. “We are absolutely behind the concept,” said David Ernst, executive VP and director of futures and technology for Initiative, the Interpublic Group media buying agency. “We think the promise is greater accountability of your media investment. There’s nothing to not like about that. But we are cautious about how quickly they are going to get support.”
Advertisers whose products are not sold in retail stores and aren’t currently measured via UPC scanning technology-financial services, for example, or autos-won’t get buying data linked to audience tune-in during the first phase of the Apollo rollout. But plans are under way to measure such purchases by alternative means such as Internet sampling.
“That’s something that we are definitely looking at,” Mr. Ernst said. “We’d want to make sure that they have rigorous enough sampling procedures to capture those sales. Also, the fairly aggressive timetable adds an extra level of complexity. It hasn’t been well defined yet how they’re going to put all this data together in one database.”
Mr. Connors said such details will be forthcoming. He also said that the Apollo joint venture would likely go forward first and be separate from the existing agreement between Nielsen and Arbitron, which has explored integrating the PPM as part of a national ratings service. There still are a number of outstanding issues that prevent the PPM from becoming a ratings service that the industry could use to buy and sell ads with, Mr. Connors said. It would probably take at least another year to resolve those issues and then more time to roll out the PPM as a ratings device, he said.
But the industry standards for launching the PPM as a planning tool aren’t as stringent, Mr. Connors said, because in that capacity advertisers are simply looking for behavioral trends and aren’t plunking down cold cash based on the ratings it generates. One example of how the standards differ: Recruitment of the planned 30,000-home panel for the Apollo project would be conducted at least in part via the Internet, which wouldn’t be acceptable for a ratings service. Using the PPM as a ratings service requires a random-selection recruitment method that creates a panel that precisely mirrors the viewing universe being measured. It’s a lot tougher to achieve because it requires door-to-door recruitment efforts, installation of equipment in the home and training on how to use the equipment.
Among advertisers, Procter & Gamble has shown the strongest support for Apollo to date, and executives of the company believe the proposed planning tool would be one of the best devices available for measuring the return-in the form of product sales-that consumer marketers receive for their advertising expenditures.
“It’s a big step forward toward helping us understand consumer habits at a level we’ve never seen before,” Ted Woehrle, VP of marketing, North America, for P&G told a recent gathering of advertisers. “P&G is really excited about this. We believe this is a great example of something the industry desperately needs-that is, broader collaboration and mobilization around measurement tools.”
P&G is the first advertiser to agree to subscribe to the Apollo service, assuming it goes forward. Others as well in the industry support the project-or efforts like it.
Speaking at the UBS Media Outlook Conference in New York last week, Sir Martin Sorrell, CEO of WPP, the London-based ad agency holding company, said that Apollo appears to have some momentum behind it because “clients are focused on saving money and improving returns on media spending.” Services such as Apollo would certainly help clients identify media segments providing better returns, Mr. Sorrell said, and might also help advertisers beat back the escalating cost of TV ad time, which is becoming increasingly unacceptable to many clients.
Paul Silverman, director of media management at Novartis Pharmaceutical Corp., has believed for years that single-source tools that measure return on advertising investment are critical to the long-term success of the industry.
“Sales response to advertising is ultimately the goal of most advertising,” he said. “I think the time is right for something like this now,” he said of the Apollo project, although company policy precludes him from confirming whether or not Novartis will sign up as a client.