Who’s Watching? Xandr’s Perspective on TV Audience Measurement

Note: Xandr is involved with various industry TV research groups (ARF, CIMM, MRC, TVDI) and we are often asked for our uses and needs with TV data. This blog piece is derived from a perspective document that we shared with one of those industry groups — TVDI, the TV Data Initiative.

How many people watched TV last night, and what did they watch? “Did they see my ad?” asks the advertiser who has invested a million dollars on a national TV campaign. The answers to these questions are more uncertain now than in the past. The measurement of TV audiences in the United States is at a crossroads, with the longstanding Nielsen panel facing challenges from various quarters, and other measurement companies offering alternatives, mostly via set top box and/or smart TV data.

The causes of this changing environment are:

• Evolving consumer behavior, with streaming now being a significant part of many people’s viewing, on various devices. This has given people more choices and made measurement more difficult.
• Availability of data from streaming sources and set top box data that give insights into households’ use of TV.
• An increased focus on data-driven advertising, that is disrupting both the traditional advertising pod and the standard measurement of age/gender demographics.

All of this matters to Xandr because we enable buyers and sellers to plan and transact on audience-based, data-driven linear TV deals via our buy-side and sell-side advanced TV platforms, Invest TV and Monetize TV. Data is the fuel that powers these capabilities, and it is a critical element: dollars spent on TV advertising must be valued in a credible way, and both buyers and sellers should trust the data and the measurement of ad performance. The term “currency data” is therefore often used, reflecting the importance of the data in the $70 Billion dollar business of U.S. TV advertising. This need for trust applies not only to an individual campaign flight but also in a more macro sense — the overall value of the TV advertising market needs to be measured fairly, and in a way that is inclusive of all viewers across the country, regardless of how they watch TV.

Of course, there is no audience measurement solution that is 100% accurate and inclusive. In a free market there will always be different consumer choices, and the data associated with some of those choices may not be made available for audience measurement. A smart TV manufacturer may not wish to share its data with the industry, and even if it does, not all consumers will opt-in to data sharing. For those that do, knowing what’s on the screen doesn’t tell us who (if anyone) is watching that screen or paying attention. Data about the household and persons in the home may also be incomplete or inaccurate, meaning that “deterministic targeting” via addressable may not be as precise as hoped. We need to accept that every deterministic data point has a probability of being right or wrong. Understanding this and shining a light on the likely accuracy of classification data for targeting is an essential part of assessing whether an ad campaign has achieved its potential.

Panel measurements can provide answers to some of the gaps that arise with big data sources. Any household, regardless of technology, can potentially be part of a measurement panel, persons viewing can be tracked in these homes, and their demographics accurately identified. But the scale of measurement panels is constrained by cost, gaining cooperation can be problematic, and viewing on some devices or in some locations may be missed.

Xandr’s perspective on data, present and future, is pragmatic but aspirational: we have to work with existing sources for business to continue, but we are committed to working with the industry to make TV measurement better and to offer alternatives to our clients. Key elements that we care about when considering TV measurement data:

1. Agreement from buyers and sellers: Xandr is committed to helping our clients grow their business. We won’t invest in data unless there is demand from our clients or a clear potential future demand that makes investment worthwhile. Any investment in potential currency data needs to be financially realistic: there is often a long runway to significant adoption of new data and unless new data sets are priced appropriately based on their usage, we will not be able to justify the expense. Data value is proportional to use.
2. Privacy: An obvious consideration. Our advanced TV platforms do not directly use any PII, and we will not use data unless we are confident that all privacy requirements around the data have been met.
3. Granularity: Our platform provides sophisticated algorithms such as reach optimization, that require household or person level data. While program average commercial minute audiences (often referred to as C3 or C7 ratings, depending on whether the ads are viewed within three or seven days of broadcast) are still used for measuring TV ad exposures, second-by-second data is becoming a requirement now as the industry looks at more precise measures of ad exposure.
4. Accuracy: Bigger is not always better. The accuracy of any measurement has two main elements — sampling error, related to the sample size of the measurement, and non-sampling error, also known as bias. Traditionally, TV measurement has been affected more by sampling error than bias due to the relatively small size of TV measurement panels. Bias was typically agreed to be low as the panels were well designed and maintained. They were (and are) subject to continuous and rigorous scrutiny, both by the data supplier and the users of the data, as well as independent auditors. With the advent of big data sources — set top box and smart TV data — small sample sizes are no longer an issue, but the second element of accuracy — bias — can be a significant problem. A sample of 7 million smart TV’s does not have significant sampling error if considered as a sample of the U.S., but it will likely have significant biases and omissions in representing the viewing of all Americans. Standard demographic weighting will typically not correct for all these issues. Some media owners will be relatively over-reported and some under-reported, causing friction and dissonance.
5. Connectivity: Viewing data must be connected to audience target data for it to be actionable. This connection needs to be as friction-less as possible, and viable economically. For cross-platform uses, connection to digital data, including connected TV, is also important.
6. Completeness: Xandr’s advanced TV platforms, Invest TV and Monetize TV, represent TV inventory that is viewed by 300 million Americans in 120 million homes. TV measurement data should represent all these people and reflect the diversity of viewers and viewing habits.
7. Transparency: Any measurement data supplier should be open to independent auditing and provide transparent descriptions of methods and data sources. For companies who wish to provide currency measurement there should be a commitment to achieve MRC Accreditation.

Currently, media owners and agencies are assessing measurement alternatives and announcing new partnerships with vendors on an almost daily basis. Meanwhile Nielsen is overhauling its TV measurement to create Nielsen One, which aims to combine its small but representative panel with big data sources. With so many alternatives, it’s unclear exactly where the industry is headed but it’s clear that change is coming.