Metrics Part 3 - The Audience Rating Point

Aug 13, 2014 by Mark Maier

We have looked at updated metrics over the last couple of posts and an article from Mediapost brings to light a new way to help measure in the digital landscape...

"The gossip is true. The mother of all media measurement, the Gross Rating Point, got her groove on with the man, Digital Measurement, and unto them was borne a new measurement standard:  the Audience Rating Point (ARP).

The GRP has ruled the TV measurement roost for quite some time.  And there is a good chance it will crusade to be the ruler of the digital landscape, too. Its focus on measuring how many people watch a TV show a certain number of times allows planners, buyers and sellers to make decisions quickly and efficiently. The simple and now-classic formula – Reach (R) x Frequency (F) = GRP – has kept TV big and round.

The digital landscape grew up in the shadow of the GRP and saw the opportunity to separate itself by looking at and controlling for frequency against the people reached. That magic little cookie allowed the machinery to put a stop to drowning people in repetitious ads, and more importantly, allowed media sellers to move past the generic impression to focus on the person. This allowed planners to control for frequency and buyers to guarantee how many people they could reach.

Thanks to the increase in the number of channels and growing diversity of programming in the past two decades, audience fragmentation has come to TV in a big way. Although more people are watching TV today, when and how much they watch is all over the map.  As a result, more ads are reaching fewer people. In formulaic terms, the R in R x F = GRP has become very small, and the F has become bloated in an attempt to maintain GRPs in the face of declining ratings per show.

Unlike digital, where the cookie allows for frequency caps to be implemented, viewers are subjected to multiple views of the same ad, frustrating consumers and advertisers alike. Until the cookie comes to TV and frequency can be capped, it is up to the business community to address the problem of too much frequency to too few people.

Enter the Audience Rating Point (ARP). The ARP takes the best of TV and digital measurement concepts and smushes the two together to create a new formula:  R=ARP. In case you missed it, the F is gone. Now it would be folly to think that Frequency does not have an important role in brand building. But at the same time we know for sure that R does equal results. And since the TV technology can’t control for frequency yet, let’s at least have the business discussion about eliminating it from the pricing formula.

Firstly, it would maximize the true value of the only media platform that is available in virtually every household by reaching audiences in the outer edges of programming.

Secondly, it would allow planners and buyers to plan and buy on the same currency: audiences and audiences only.

Thirdly, sellers would have the option to sell against impressions (F) or audiences (R) and thereby focus the conversation on the marketing tactic of reach, resonance or reaction.

Lastly, and most importantly, we the consumers will not be bombarded by the same ad over and over again, thus improving the overall watching experience.

At the end of the day, the market doesn’t need advanced technology to transact against metrics that are already available in today’s toolsets."

 

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