As timeshifting soars, a push to revisit C3
The networks argue that ads should be sold on C7 ratings
November 15, 2012
A decade ago, the only thing that mattered to media buyers and ad sellers was who watched TV the previous night.
Ratings were based on live viewing, and overnight ratings were the ultimate word in who had watched a particular show.
Then DVRs came along. Suddenly shows were being timeshifted from their traditional timeslots to whenever suited the viewer, and viewers could fast-forward through their ads.
Nielsen responded by making two big changes. First it began measuring DVR playback across a number of streams, including same-day, three-day and seven-day playback.
Second, it developed ratings for the commercial minutes themselves, separate from the programs, to determine how many people were staying tuned for the ads.
After a long, drawn-out debate, media buyers and the networks reached an agreement five years ago to change the currency ad buys are based on to C3 ratings, or commercial ratings including three-day DVR playback.
Fast forward to the present and another shift may be on the horizon. Now the networks are pushing buyers to switch the ad buying currency from C3 to C7 ratings
It’s a move that’s being met by skepticism among buyers.
“The networks, of course, are interested to increase C3 to C7 because it will get them more GRPs/impressions and allow them to keep their unit costs stable,” says Gary Carr, senior vice president and executive director of national broadcast at Target Cast tcm.
“Of course there would be advertisers like retailers and movies that would not be happy about this.”
The networks are pressing their argument hard. They point out that 46 percent of Nielsen households now have DVRs, more than double the amount five years ago.
They also note that people are time-shifting more frequently. A couple years ago no show was drawing 3 million viewers in live-plus-seven-day-DVR playback. Now 14 shows do so weekly.
CBS chief executive officer Les Moonves and Disney CEO Bob Iger both made a case for using C7 ratings for ad buys during recent earnings calls with analysts, echoing the pitch made by Ted Herbert, chairman of NBC Broadcasting, earlier this year.
But media buyers aren’t ready to commit to the change. Though they admit there could be some advantages, such as increasing inventory and thus stabilizing CPM increases, they still have reservations.
Many ads are time-sensitive, such as those promoting sales, and having viewers watch them several days later does not do the advertiser any good. Buyers don’t want to pay for such ads.
They are also interested in tracking not just delayed viewing but viewing across all sorts of screens, including web and mobile video.
Buyers note that Nielsen’s efforts to expand online ratings, which will include web video viewing, and finding a reliable way to track on-demand video would present a much clearer picture of who’s watching what and add new dimensions to the C7 ratings question.
“As technology improves audience metrics, changes will be in the offing. When, I can’t say,” Carr says.
“There’s the third screen audiences, and the desire for commercial audiences for that will also enter the picture.”
It’s probably inevitable that C7 ratings will be adopted as currency at some point, what with the rate of DVR adoption and delayed viewing.
But buyers will push to hold off as long as possible, and when they do acquiesce, they’ll want some concessions from the networks. What those concessions will be remains to be seen.
“There will be more discussions down the road,” predicts Carr.
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