TV Engagement at the Local Market Level

How local TV used to be measured in the United States reminds me of the iconic fairy tale Cinderella. There was a wicked stepmother who treated her own daughters well, but Cindy got the shaft (or at least the broom). Local TV used to just be a hodge-podge of small samples, a mixture of varying methods of differing quality, which produced differing results, bouncing numbers, and many, many markets with hardly any clothes—I mean, rating information—at all.

Well, in real life, like the fairy tale, there is a Prince Charming to rescue the fair maiden. [1] Rentrak’s massive and passive measurement will soon include 60 million TVs and 26 million homes. That will be about one in four households. Our approach is the same in each market—365 days a year, 24 hours a day.

One great thing we are able to do is provide metrics that have traditionally been just the province of national TV—like engagement, or what we call “stickiness.” As noted in previous blogs, Rentrak’s measure compares the average percentage of a program or series viewed to the average of programs of the same duration to create a comparable metric across programs of different lengths. (It is easier to watch 50 percent of a 30-minute show than a 60-minute show.) Average percent viewed has been validated as being directly correlated to advertising effectiveness from work done at the media agency Zenith.

An example is below from an actual market with actual TV shows. This shows the straightforward rating (vertical axis), and average percent viewed (horizontal axis). For clarity, news programs are green diamonds, game shows are blue boxes, sitcoms are purple circles, and gossip shows are orange triangles.

Bruce's Blog Charts – September-01

Looking at programs this way gives leverage points to all sides. The station airing the 10 p.m. news can say, “My ratings aren’t the highest, but I have a high average percent viewed.” The agency can say to the station airing the third 10 p.m. news show, “You have high ratings, but your audience isn’t very engaged.” However, the “fairest way in the land” to look at the shows, is to employ Rentrak’s Stickiness Index—or TV engagement metric—as mentioned above. The chart below takes the same programs, indexes the ratings to the average of the selected shows, and applies the duration-based Stickiness Index.

Bruce's Blog Charts – September-02

There is not a lot of movement in the upper-right quadrant of higher ratings and higher engagement except celebrity news slips a little bit in terms of Stickiness value. The big news is the shift into the high Stickiness, lower rating quadrant of two news shows and a game show. This is because, compared to other shows of the same duration, they have a lot of engaged viewers.

I’ll be glad to share the actual data with any Rentrak client. And yes, these charts are produced along with a spreadsheet in Rentrak’s local system—though they have “been put in a prettier dress” for the ball.

Not a fairy tale and a happy ending!

In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues – which I will do from time-to-time on this blog.

[1] I’m not talking about Rentrak’s EVP of Local Television, Steve Walsh—though he could play the part.

Buying and Renting Movies and TV Shows Online—Legally! It’s a Big Business and Getting Bigger. Rentrak Is There to Prove It.

Movie studios and TV networks are realizing there is a way to collect revenue on the Internet for their content directly from consumers. (Rentrak has been collecting this data since 2006 and we are permitted to show some of this data from 2012 onwards.) There are two main methods used. Pardon me while I go into “lingo land” so that you know what I am talking about:

EST = Electronic Sell-Through

  • The purchase of digital content by a consumer who pays a one-time fee for a perpetual license to view the content. EST is essentially the digital equivalent of buying a DVD or Blu-ray Disc (BD).
  • EST content may either be downloaded or streamed through services offering access to a virtual locker.
  • Major data providers include Apple’s iTunes, Amazon, Best Buy, Google Play, Microsoft, Sony PlayStation, and Walmart’s Vudu—to name but a few.

iVOD = Internet Video On Demand

  • The rental of digital content by a consumer where a fee is paid for a pre-determined window of time in which that specific content can be viewed an unlimited number of times. iVOD is the digital equivalent of renting a DVD/BD.
  • iVOD content may either be downloaded or streamed.
  • See above for major data providers.

Let’s first take a look at EST movies. What has been the trend in buying movies on the Internet? (Or from the cloud, which sounds cooler—am I showing my age?)

EST Chart

As the chart above shows, selling movies online is becoming a pretty good business for the studios. (Rentrak captures information from the seven major studios plus a number of independent studios). Since the beginning of January 2012 to April 2014, the number of movies sold online has virtually doubled. In addition, there are peak periods around Christmas—for gift giving—as well as when specific “hot titles” hit, like Disney’s “Frozen” did in March of this year.

However, the rental of movies online has not shown the same growth rate as purchasing—growing only about 25 percent since January 2012 as shown in the chart below. There is a key reason for this. Because EST margins are much bigger for the studios than either digital rentals, or DVD/BD sales/rentals, the studios are providing movies via EST with an early release window—usually 1-2 weeks prior to VOD, iVOD or DVD/BD. Bottom line, studios are hoping to bolster EST with early windowing for tent-pole titles and key independent titles. Consumers have an access-first mentality; if they can get the movie now, why wait? It’s the consumer preference for going to see a movie on the opening weekend expressed in a digital age.

iVOD Chart

In terms of TV shows, we can only show information on EST, because TV shows are not available via iVOD, which existed only as a short experiment by Apple with ABC/Disney as the only studio signing on. In regards to EST, the chart below shows that purchasing TV programs via the cloud has grown at about the same rate as movies—doubling since January 2012.

Web-based Order Volume Chart

And this is not just an online phenomenon. Major “traditional” video content distributors like Comcast and Verizon FiOS now provide an EST option for their customers. In fact, Comcast had a public success of its EST launch with the announcement that it took the number one spot in digital sales of Universal’s “Despicable Me 2″ in early December 2013.

I think that it is very interesting to see how careful (and smart) the video content providers are being in this digital age. Compare the growth in the digital sale of movies and TV shows in the past two years with sales and downloads of music. As reported by Billboard in first quarter 2014, digital music sales were down 13.1 percent and CD sales were down 20 percent. In comparison, video providers have been carefully managing their content, looking to maximize revenue as the consumer shifts from physical ownership of video to virtual consumption. Digital does not have to equal death. Digital can equal dollar$.

In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues—which I will do from time-to-time on this blog.

Social Media & Television: Which Cable Programs Get the Buzz?

“Happy talk, keep talking happy talk.
Talk about things you’d like to do.
You gotta have a dream. If you don’t have a dream,
How you gonna have a dream come true?”

“South Pacific” – Music by Richard Rodgers and lyrics by Oscar Hammerstein II.


As reported in my May 19 blog post, Rentrak has been partnering with social media tracking companies over the past several years and publishing a weekly “TV Engagement” or “Stickiness” report that covers ad-supported primetime programs. In that blog, I talked about the level of social media chatter about network TV shows in Prime.

That blog pointed out that if an advertiser is looking for broadcast network Prime shows that are the “crème de la crème” in generating buzz, they should look to “Awards” and “Sports” first. “Drama,” “Nighttime Soaps” and “Teen-Oriented” programs also get a lot of talk. It is interesting to note that this reflects the conventional wisdom of what shows used to get talked about the morning after they aired around the water cooler or in the halls of high school.

As mentioned before, in 2013, we partnered for most of the year with Trendrr, and then later with General Sentiment, to create our weekly reports on the most “buzzed” about ad-supported Primetime broadcast network and cable TV programs. The two companies have different ways of scoring social media chatter about TV shows, so to make a fair comparison for the whole year, I averaged each service’s score and indexed their reported programs to their own average. So what you will see in the following charts are program counts for both services for the entirety of 2013, as well as the average indices by genre for both services.

In this blog, I will focus just on ad-supported cable shows in Prime. It is very important to note that all of these ad-supported Prime cable shows were the most talked about ad-supported Prime cable shows during the week in which they aired. An index above 100 just means that, within the most talked about ad-supported Prime cable shows, the show was even more talked aboutAn index below 100 means that, within the most talked about ad-supported Prime shows, this show was less talked about.

So let’s look first at the volume of chatter by program genre for ad-supported cable Prime shows in 2013. As before, I’ve done my own personal classification here (in part to protect the innocent), but also to reflect the nuances of social media buzz about TV programs.

# of Cable Shows by Genre

The chart above shows the number of times a show in this genre appeared in our weekly list for ad-supported cable Prime top 20 most talked about shows in 2013. It is a count of occurrences on our weekly list. The greatest number of talked about ad-supported cable Prime shows in 2013 were in the “Reality” genre, followed by “Drama,” “Sports” and “Comedy.” “Drama,” “Reality” and “Comedy” also were often talked about for broadcast Prime as was pointed out in the May 19 blog. However, “Competition” (e.g. “So You Think You Can Dance”) was number the number one genre for the broadcast networks, but was number six for cable.

The chart below looks at the average index of the shows in the genre compared to the average of all talked about shows over 2013 in ad-supported cable Prime. As in broadcast Prime, Award shows on ad-supported cable networks are the most talked about programming. The high score for awards shows in cable is due to not only the basic human appeal of talking about winners (and losers) but also to the fact that cable awards shows are geared to younger viewers (e.g. music awards) who are more likely to be chatting with each other.

Average Genre Index

So “the end is our beginning” as T.S. Eliot said. What generates conversation about TV shows? What has always generated conversation: shows with glamorous stars, shows with an edge of competition with winners and losers, shows with dramatic plot twists, shows that really make you laugh, and shows that have a particular appeal to the young. This holds true across broadcast and cable.


“It might be a fight like you see on the screen,
A swain getting slain for the love of a queen,
Some great Shakespearean scene,
Where a ghost and a prince meet,
And everyone ends in mincemeat. 

A clown with his pants falling down,
Or the dance that’s a dream of romance,
Or the scene where the villain is mean.
That’s entertainment!”

“That’s Entertainment!” – Music by Arthur Schwartz and lyrics by Howard Dietz.

The Power of Video on Demand

Here’s a quick little blog for the fan base about how Video on Demand (VOD) can be an effective advertising tool.

In this case, I am talking about networks advertising themselves (e.g. using promos to get tune-ins). Rentrak does a fair amount of work on the effectiveness of promos, which is how many people “convert” to viewing a show when they see a promo for it.

Now turning to VOD, one nice thing about the millions of return path TVs Rentrak has is our ability to look in detail at TV viewing across linear (that’s the lingo for plain old programming) TV and VOD. We can look at duplication of viewership. So we can see what happens when a network runs a “teaser” for a new show on VOD, and then see how many tune into the program on linear TV. Guess what? We see that VOD teasers for new programs have a higher conversion rate than traditional promos.

Bruce Blog Chart

Now these aren’t controlled experiments, neither are they the same shows, so fellow research nerds don’t give me a hard time!

But these results give an indication that those people who chose to watch VOD are more involved. It requires positive action to select and view the VOD teaser. And if the teaser is good enough, it does have the power to get people to take subsequent action and watch the full program. Bottom line, VOD involves and gives power to the viewer, which is the new world of marketing. Promos, while effective, exist in the older model of “pushing” at the consumer. VOD is the world of tomorrow’s marketing, today.

In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues – which I will do from time-to-time on this blog.

Local TV News: The Solid Medium

I love new electronic toys. They make life easier. Last week, some of my staff members were giving me weird looks as I spoke my IMs. That is, I used the Google voice function on my Droid to write out an instant message rather than typing it. If you ever get any of my text messages, you would know why I like to be able to not use my heavy-handed thumbs to punch out my missives.

But I wonder if the media technologist in all of you (and in me) can become too in love with technology and not recognize the solid delivery that traditional media can provide. Take local news, for example. Traditionally, in the 156 markets that are served by a diary sample issued four times a year, the value of local news can be misunderstood, because it isn’t measured well. First off, numbers bounce all over the place and secondly, there aren’t many numbers at all. The nice thing about the return path data that Rentrak employs is the continuous and large footprint. This means stability and granularity.

Take Rochester, New York, a local market that is in the top 80, where Rentrak has approximately 12,000 homes reporting every day. If we look at the first quarter of this year, for the daily household ratings for Monday through Friday news, we see a very stable pattern across the entire quarter for two local stations. In fact, both the high rated and lower rated stations shown below have the same very low level of statistical variation of <10%. (The coefficient of variation—email me and I’ll explain it.)

Daily M-F News at 6 Chart

And that stability isn’t just something that happened in one quarter. Look at the same quarter in 2012. The rating levels of the two stations have the same stability, and are very close to what they achieved in 2013.

News at 6 Chart

This continuous, solid delivery is not to be taken lightly. Media plans for core targets (of which there are many—I use toilet paper and I hope you do, too) need a strong base from which to build. Local news isn’t a bad place to start from a reach perspective. They provide large audiences, without much duplication between them. The interesting thing is, the news programs do move in tandem, when there are big (or small) news stories, the stations’ ratings track each other as shown below.

Daily M-F News at 6 Chart

Local news can also deliver narrower segments, including online buyers. Rentrak has merged its viewing data with MasterCard’s purchase segments. And, as seen below, a news series can perform well (or at average) in broad categories like grocery shopping and fine dining, and can index higher for Black Friday shopping both on and offline, as well as for very high spenders for Holiday shopping. Something to remember at this time of year.

Index of Top Spending by MasterCard Categories Chart

So, the relatively low-tech medium of local news delivers a substantial audience day in and day out, provides reach, reflects what is (or isn’t) interesting to the local community, and can deliver traditional, and online buyers. I believe that solid delivery can help form the broad base of a media strategy.

Now back to the toys!

In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues – which I will do from time-to-time on this blog.

Exciting News on VOD Performance by Network

Video on Demand (VOD) is a rapidly growing form of television. The excitement comes from its double-digit growth, particularly in the “TV Entertainment” category, which consists of free programming put up by the traditional broadcast and cable networks, as well as VOD-only networks. Viewers are finding out that their favorite programs don’t have to be DVR’d, and that when a friend mentions a new show, more often than not, it can be found On Demand.

The VOD industry is also moving in an exciting direction to start sharing data. Rentrak has been producing a “Transparency Report” since January 2012. Forty-eight cable networks first agreed to allow monthly data to be shown. That number has grown to more than 60 cable networks. (As I write this, there are no broadcast networks participating.) I thought my loyal fan base (including the guy with the court order to stay back 500 feet) would be interested in a top line peek.

I first took all the 2012 reporting VOD networks and averaged their results over the first half of 2012. I then graphed them out by what is important to media planners and buyers—reach and frequency. Reach is important because it determines the breadth of the target audience. Frequency is important because it reflects how often ads can be delivered.

In the graph below, the horizontal axis is the average monthly reach, or unique set-top boxes that watched a program on a network. The vertical axis is the average number of times a network was watched per month. The intersection of the two axes is at their respective averages, creating a quadrant map. I’ve labeled the networks that have both high reach and high frequency; they are the ones in the upper right-hand quadrant.

Average Reach & Frequency for VOD by Network

Clearly, Music Choice is a strong outlier, with an average frequency more than four times higher than other networks. The video music format obviously is a big draw for repeat viewing. Also interesting to note is the presence of kid’s networks like Nick Jr., Cartoon Network, and Nickelodeon. Children are “early adopters,” and are masters of the push button (and screen swipe). A&E, TruTV, TBS and Comedy Central round out the quadrant.

However, the picture changes a bit if we look at another key metric—time. The quadrant map below looks at the same networks but has the number of minutes a network was watched on the vertical axis. While the three children’s networks stay in the upper right quadrant, Music Choice slips to the edge. Music Choice, because it is a short form genre, obviously could have many viewers and a lot of frequency yet less dominance in time spent. More networks with longer formatted programs join the quadrant: AMC, History Channel, Impact, Lifetime, MTV, TLC, TNT and VH1. Comedy Central stays on the edge of the quadrant.

Average Reach & Time Spent Viewing for VOD by Network

I’d be a bad researcher if I said this is a definitive look at VOD. Not all networks have agreed to be transparent, and I haven’t even shared with you all the networks we do have data on.

Finally, when you think about those millions of VOD viewers, just waiting for someone to put in a super impactful pre-roll ad as they settle into watch the program they have deliberately decided to engage with, doesn’t the ad man (person) in you salivate? I know I do! And these Rentrak transparency reports will help build the marketplace to make it happen.

More information on VOD can be found in Rentrak’s State of VOD: Trend Report and monthly transparency reports. Please contact Gordon Jones, Rentrak’s VP, OnDemand Everywhere, at gordon.jones@rentrak.com if you are interested in either of these reports.

In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues – which I will do from time-to-time on this blog.

The Value of Media Leverage

I recommend a highly interesting review by Brian Wieser (brian@pvtl.com) of Pivotal Research Group on the announced merger of Publicis and Omnicom, as well as Facebook’s claim to be an effective ad medium because of its broad reach in daytime. In his analysis, Brian makes the point that reach by time of day is not the key factor in media planning—the intrinsic effectiveness and cost of the media come first. That is one reason for the Publicis OMD merger—to develop ways to buy online video at a cheaper rate.

But beyond that, Brian also makes this point:

“For a good illustration of how issues like the above play out elsewhere, consider: if marketers could identify the 20 percent of local markets that drive 80 percent of variations in outcomes, wouldn’t they spend more money on local media? It’s a potentially massively more efficient way to spend money, and one which marketers have had the capacity to execute against for many many years…and yet if anything marketers with nationally-skewed corporate structures have been shifting most of their spending towards national media over the same time. Consider that over the past ten years, national mass media owners’ advertising revenues grew by 33 percent while local mass media owners’ advertising revenues fell by 28 percent during the same time. Reasons unrelated to marketing efficiency usually have substantial sway in dictating changes in advertising spending choices across the economy.”

I believe effective media leverage is finding those media and those geographies where there are greater concentrations of product users that can be bought more efficiently—these are the key places to grow share. A simple example of this is the national election, where the Obama for America campaign advertised in only 44 TV markets (using Rentrak data).

The reality is that our country is becoming increasingly Balkanized, with different concentrations of cultures and economies in different parts of the country. The map below from Pew Research shows the importance of religion in people’s lives—the darker the color, the more important. The Northeast and West Coast are clearly different than the Deep South.

Map

This disparity extends to lifestyle and product usage as well. The map below from The Atlantic shows where the 1 percent is concentrated. Those products that cater to the more affluent (e.g. cars) need to consider the disparities in income that allow for people to purchase or lease cars.

Map 2Car manufactures have weaned themselves away from the incentive “drug” of the ‘90s causing an increase in the real price of automobiles adjusted for inflation as the chart from the Motoramic blog indicates.

US New Vehicle PricesThe increase in real car prices in the auto industry alone makes understanding the differences in sales across markets and within a medium even more important. Since Rentrak has the same measurement methodology across markets, we can provide comparable TV delivery indices across markets, unlike the sample-based folks who have different methods in different markets. Rentrak can also do this with actual auto sales information, as we have integrated Polk data across our footprint. In addition, within a market (and for the nation as a whole) we can indicate where to find the best TV leverage points for auto buyers. I leave you, dear reader, with a fun example of where to find the Cadillac buyer in Dallas in March in Early Fringe.

RentrakCadillac

I wasn’t a good media planner and I didn’t look at the all the networks and stations we report on. I used the major broadcast affiliates and a couple of cable networks. It isn’t just the news networks like CNBC and FNBC that index high against Cadillac buyers. Affiliates like CBS and MeTV also have high concentrations. Unfortunately, the few liberals in Dallas on MSNBC don’t seem to be lovers of Cadillacs.

Bottom line, Brian is right. Leverage in media can be found across markets, within markets, and across media. And Rentrak, with its Advanced Demographics can help with that leverage.

In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues – which I will do from time-to-time on this blog.