Tuesday, November 13, 2012

The value of delayed TV viewing: networks vs. advertisers

Today I read two articles on the excellent MediaPost about why the big US networks want to expand the "C3" ratings to something called "C7". And some are of the opinion that even "C7" is not enough.

OK, for the none initiated, "C3" refers to Nielsen ratings and today, Nielsen considers a "rating" for a TV show any viewing that occurs within a three day time-frame, so a combination of live viewing when the show airs, plus any viewing via DVR within 3 days of the actual broadcast. 

The networks have now discovered that "C3" actually does not cover all of the viewing that occurs for the more successful shows that have a loyal TV audience. Research now shows that 90% of viewing is accomplished after 7 days, not 3.

Why is this so important to the networks? Because they want to charge advertisers for the audience they deliver. So the larger the audience, the higher the cost. Logical, right. 

Well, hold on, that makes sense when you are one of the TV networks who (on average) struggle to deliver an audience over 5% on average, and who hold a command only over the graying population of 50+. And whether you are in the US or any other TV market, the following is of relevance to all.

As advertisers, we should be concerned about this trend. Of course, if, as advertiser, I am interested in reaching my segment of the audience that is reached well by, say, Modern Family (a favorite in the Albarda household), then I am happy to pay for that audience, and I want as many of them as possible. The "C3" rating was 4.9%, the "C7" rating 7.3 among adults 18-49. So all good, right? Well... as long as...

Yes, there is a "as long as", and it is this: the "C7" approach is fair as long as I am just interested in overall reach. But what if my offer is time limited (e.g. "offer valid until" or "this Columbus day weekend only") and the 7 days takes me past that date? Now I am paying for waste - reaching people that have no value to me.

What if I want to only reach the truly engaged with the show? Could one argue that people who make an appointment with a show and want to watch it when it airs to be part of the buzz are more engaged viewers than people who DVR it, and fast forward through the commercials (come on, don't you?).

As advertisers, we are best served with options and variations. Sure, from a consumer insight point of view, I want to know what the source of viewing is. And apart from DVR's I am keenly interested in how many people watched it at home, through TV, DVR, Netflix or other services, etc. And how many people took their TV with them on a phone or tablet? This tells me a lot about consumer behavior and attitudes toward TV viewing habits.

But being able to track all of those behaviours does not automatically mean I want to buy all of those people. As said, that very much will depend on my objectives and the target I am trying to reach.

So, instead of "C7" OR "C3", we should have "C7" and "C3". As well as perhaps "C1 to C-long tail". 

BTW, a whole 'nother issue is that today's debate is about buying "C-anything" from a national TV network. I am sure I will, in the not too distant future, buy a "C" audience from other parties, such as the actual content producers, or YouTube or Netflix. Bring it on! Diverse offerings make planning fun and cost more competitive.

Here are the two articles referred to in this post:

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