Saturday, June 27, 2009

Why Are We Doing This?

You have to hand it to Arbitron. Many of their client stations and groups complain that they don't listen or act on suggestions which seem quite sensible, but whether that's true or not, the company certainly does a very impressive job of telling clients and consultants on a consistent basis what they are working on and why. For example, during the latest PPM conference call/update, they released these stats on how PPM ratings compare to diary estimates, so that advertisers can understand the differences between diary audience shares and PPM listening levels.

Radio sales reps have a very difficult job in the PPM markets, as they present weekly AQH persons, AQH shares and cost per point, since before they even start the sales process they must first 're-educate' the buyer on why what they previously paid $100 for is now worth $118 if the target is 18-49, $123 if it's 18-34 and $114 if the client wants to reach 25-54.

All of this is based on the standard measure of radio ratings for at least six or seven decades, the "average quarter hour." Why does five minutes listening inside a quarter hour equal a quarter hour? Once upon a time, radio was programmed in fifteen minute blocks. Advertisers from the 1920's to the 1950's wanted to know how many listeners were tuned into their fifteen minute program. In the late 1940's, the "diary" was invented as a way to measure audiences and the standard of measurement remained the average quarter hour. It's been like that since.

PPM shows radio's many strengths as a medium in so many other ways, in terms of both reach and accountability in a much more believable and granular way than the diary ever could.

Today's PPM is capable of measuring listening behavior down to listening units of a minute or even shorter durations. Canada's BBM is now measuring radio and television audiences and the standard unit will be average minute audiences, which seems to be a more accurate measure, requiring no math to allow an advertiser to know how many folks watched or heard their ad, something they could never have done with diary data.

Isn't it time to stop playing games to get listeners artificially to spend the 'right' twenty minutes inside four quarter hours so that it appears that they listened for an hour? Why not simply drop average quarter hour as the standard for ARB PPM measurement and show how large radio's audience is in every single minute, seven days a week?


Jeff Vidler said...

I agree 100%, Jaye.

Average minute audience makes a whole bunch of sense for a whole bunch of reasons.

Just one problem. Radio listening levels would take another hit. By crediting 15 minutes for 5 minutes of listening, the quarter hour approach grants radio up to 10 extra minutes in some quarter-hours. A 2005 PPM study by BBM in Canada pegged the difference at 30 minutes a day between the average minute audience and the 5-will-get-you-15 measure that;s being used in the US.

Does US radio have the stomach for another 15% hit on tuning levels?

Jay Guyther said...

All the other countries that use PPM for radio measurement (Norway, Denmark, belgium, etc) use average minute ratings. Arbitron initially considered moving to average minute ratings when PPM was introduced, but the Radio Advisory Council advised against it as 'too much change' at one time. Eventually, Arbitron must adopt average minute as the primary reporting metric.