2019—The Year The Traditional TV Ratings System Finally Crumbles
2019 has only just begun and already the traditional world of the TV ratings has sustained a heavy blow with US TV Network CBS not renewing its Nielsen contract into 2019. This is a significant blow in both financial and strategic terms to the public research company which is struggling to bridge the measurement gap between its traditional ratings system and the new digital first video landscape. While the CBS contract accounted for an estimated 4.4% of Nielsen’s Watch segment (which include video audience measurement) revenues in 2018, the prestige value of having one of the big three US broadcasters selling advertising inventory on the back of its ratings methodology is much higher. While the decision not to renew the contract into 2019 may be nothing more than the start of new contract negotiations between CBS and a 3rd party vendor it does however dramatically draw attention to the crisis of measurement currently unfolding in TV.
The TV future is already here and it’s fragmented
Nielsen has been trying to address increasing concern over its seeming inability to provide a digital equivalent to the ratings system on the non linear TV ecosystem, by introducing initiatives such as the Total Content Ratings.However the consumer landscape continues its move away from linear. In Q4 2018 US 16-19 year olds were more than twice as likely to watch Netflix and Amazon Prime Videos on their phone than on the TV screen as the consumer average. (MIDiA Research Brand Tracker Data). Simultaneously, and more worryingly in the short-term for Nielsen, SVOD (Subscription Video On Demand) monthly subscriptions finally exceeded traditional pay-TV subscriptions among US consumers.
In the distributed audience economy viewers are in multiple locations at once. This makes duplication of audience measurement a huge challenge for measurement companies and underlines the challenge for Networks being able to effectively deliver audience valuation estimation to their advertising partners. The one-sided data exchanges with SVOD services merely reinforce this opacity - content providers are given a set of streaming data in isolation, compared to the traditional overnight ratings which provided context through delivery of competing shows airing at the same time.
In 2019 new currencies of TV measurement will come to the fore
With a unified ratings system increasingly anachronistic for the digital era, new tools of measurement will emerge to provide clarity to both content owners, distribution partners and crucially to advertisers looking to implement meaningful media plans. In this newly emerging TV measurement paradigm, 3 metrics will become crucial to gauging the relative success of TV content-awareness, recency, and fandom. Of these 3 fandom is the most valuable evolving metric as it allows content IP holders to attach an evolving ROI on their investment in the brand equity of the content. Brand equity matters as it is crucial in breaking through the digital noise and carving out viewing time in the peak attention-economy.
With so much now riding on the optimal way to resolve the current industry measurement gap, expect 2019 to be a big year for investment and disruption to bring TV measurement into the digital era.