The Reality of Commercial Ratings and Engagement

Apr 12, 2007  •  Post A Comment

By Andrew Hampp, Advertising Age

With just one month left until what will no doubt be the most complicated upfront, major players on each side of the table assembled at New York’s Tishman Auditorium (home of Bravo’s “Inside The Actors Studio”) for Advertising Age and TelevisionWeek’s Upfront Television Advertising Summit.

Commercial-Ratings Debate

After Google, MediaVest, Sony Pictures Television and ESPN had discussed the digital equation, the time came to revisit a topic of nonstop debate this year: commercial ratings. Last month, ABC’s sales chief, Mike Shaw, and Group M Chief Investment Officer Rino Scanzoni made waves on a panel for the Association of National Advertisers by expressing their intention to do deals based on their own version of Nielsen’s minute-by-minute ratings. Both executives elaborated their positions at this week’s panel.

“I like commercial ratings. They make us look good,” Mr. Shaw said. “The buyers are going to reward all the vendors who have the highest amount of commercials being seen. That’s what commercial ratings are going to show — and do show.”

Mr. Scanzoni added: “People have realized, as they start looking at the data, they need to have broadcasters and cable nets trying to design the way they put commercials in programs. Up till now, they’ve basically just been rewarding ratings across all minutes. There’s been no incentive to drive that retention, but it will happen this year.”

Measurement’s more interesting

In an earlier panel, Google’s Director-TV Ads Michael Steib championed more granular data. The buzz about the recent Google-Echostar deal has fixated on the auction, but “there’s a more interesting conversation to be had about measurement,” he said. “We’re pulling real-time, second-by-second measurement from millions of data points … [keeping marketers] more informed about engagement and metrics.”

Mr. Steib envisions marketers using the data to judge how well certain pieces of creative fare with certain program audiences and making adjustments to their spending accordingly. If a marketer finds a certain piece of creative holds the audience of a particular program quite well, it might bid 50 cents more the next day — or, if it performs poorly, bid $2 less.

He said TV salespeople would benefit from being able to prove the value of their inventory. “What’s baked into those negotiations is a level of uncertainty that lowers the perceived value of that inventory.”

Role of Engagement

While the currency is still in question, the role of engagement will continue to change as well. In his keynote speech, Roger Adams, chief marketing officer for Home Depot, defined engagement as a meaningful brand experience as it relates to programming, whether it’s within the show or outside. He then introduced a clip from a recent branded integration on a holiday-themed episode of “Girlfriends” on the CW, which used Home Depot as a key plot point.

“For us, that is engagement. For others it should be commercial ratings,” he said. “When we’re on engaging programs, our advertising performs better than in a less engaging format. We’ll float more money toward those who can give us engagement guarantees.”

In addition to commercial ratings, Nielsen plans other changes to its metrics, including upping its national sample from 9,700 homes to 12,500 over the next few years. Kevin Svenningsen, senior VP-sales and marketing for Nielsen’s Broadcaster and Syndication Services, said Nielsen will also make DVR playback data from one to seven days available starting April 24.

“This is the biggest change that’s been dealt with in about 20 years nationally,” said David Marans, exec VP of IAG Research. “What we’re finding is programs are being watched differently, given passive commercial avoidance. There are programs that keep people glued to the set. ‘Lost’ is a program with very high engagement, which enhances the environment.”

Buyers and Sellers Panel

A closing panel of buyers and sellers addressed the enduring relevance of the upfront as it relates to securing inventory. Michael Teicher, exec VP-media sales at Warner Bros. Television Group, said there are “pockets of strength” that are new to this year’s upfront, but its importance is starting to be overemphasized. “It’s very clear our business is no longer done in any short pocket or period of time. At the end of the day, we need to count our chips after 365 days.”

Cable should rebound from its 2% decrease in last year’s upfront, said Linda Yaccarino, exec VP-general manager for Turner Entertainment sales and marketing. “An incredibly consistent audience has migrated to programs from broadcast, especially in light of what’s going on in the scatter market,” she said. “Cable has quite an interesting and good opportunity for advertisers to do some really creative things.”

Donna Campanella, executive director-global media insights and marketing intelligence at Avon Products, echoed the shift toward more innovative discussions. “The model has changed now. Everybody is operating more as they’re looking beyond just their specialty. The silos have certainly been broken down.

“It’s a question of staying focused and talking about what you want,” she said. “This is not something that can be done at the upfront. These are ongoing conversations that will not prevent the upfront; they will augment it.”