Nielsen’s New Radio Monitoring Service – What it means for Radio Advertisers
Recently Nielsen Media Research announced it will enter the radio monitoring business in 50 small and mid-sized markets. The decision brings Nielsen into direct competition with Arbitron’s near monopoly in the measurement of U.S. radio ratings. Empower’s clients who are active radio advertisers could see Nielsen radio data presented by local stations or radio groups as early as August 2009. We offer Empower’s position on the new service and what it means for our clients.
The competition between established Arbitron and the new contender Nielsen will ultimately strengthen radio measurement and insure that pricing remains stable. It is even possible that increased competition will result in short-term price discounts once Nielsen is able to establish itself as a viable radio measurement firm. Nielsen is a very reputable research supplier and certainly has the capability to compete nationally with Arbitron for radio audience measurement services if it chooses.
However, Nielsen’s diary methodology to measure radio audience offers no real improvement over Arbitron’s previous diary service and could result in side-tracking Arbitron’s roll-out of more advance portable people meter (PPM) technology that measure actual radio exposure. Arbitron is now offering this advanced electronic measurement in 14 of the top radio markets, with plans to launch 19 additional markets in 2009.
To be fair, electronic measurement is not perfect. It is expensive to implement and it can only measure on what the technology actually hears. Forced exposure to the boss’ easy listening station at work, counts just as much as time spent listening to your favorite rock station. And forget about monitoring any station heard while using a headset so as not to disturb coworkers in the next cube. Nevertheless, electronic measurement eliminates the most common problems with listener diaries; respondent recall. Do most people really remember what they listened to this morning on the way into work? If so, it’s very unlikely many did their listening in perfect 15 minute increments as required for diary measurement reporting.
Empower affirms it is better to measure what consumers are actually listening to via electronic measurement technology than rely on respondent reported information, that is what they say they are listening to usually hours or days after the actual event. Nielsen also admits electronic measurement has merit, since it’s now rolling out its own television ratings electronic measurement technique (the local people meter) in the top 25 television markets.
Empower believes that all media must move aggressively toward measurement that accurately reflects actual media usage. Arbitron’s efforts toward measuring actual radio listenership, while not perfect, represent the best efforts yet to understand when consumers listen to radio. Marketers and advertisers need accurate, relevant information to make decisions on what media best reach consumers. Understanding the true audience delivery of radio allows media buyers to buy more stations, purchase previous underused dayparts and negotiate more effectively on behalf of their clients. In today’s information on-demand world, an annual study where consumers are asked to remember what stations they listened to in quarter hour increments is simply not sufficient.
Empower continues to focus its efforts on understanding how consumers relate to media and encourages research suppliers who have similar objectives. We remain committed to helping our clients better understand media behavior and how it influences the purchase decision.
By: Kirby Thornton, Director of Consumer Insights kirby.thornton@empowermm.com
