I have hesitated to write a blog entry about the PPM debate until the dust settles. But it appears that every day, new developments continue to occur. So, to add to Mark Ramsey’s recently-posted great blog entry about PPM, here are a few thoughts…
1. PPM ratings will not look like diary ratings. And isn’t that the point? I don’t know about you, but I am so tired of looking at monthly diary “extraps” where strongly established morning shows (that are essentially the same, day in and day out) have a 3 share in July and an 11 in August. But there it is, again and again, and many radio execs, managers, salespeople, and advertisers continue to react to these rollercoaster, inexplicable ratings inconsistencies. The PPM numbers that I’ve seen in Philly more clearly reflect reality as we know it. Talk to PDs and GMs in Philly. They’ll tell you that, by and large, the PPM numbers they review each week/month are a much closer reflection of what they’re programming, or hearing on the competition. No excuse for low samples here, but PPM is a much closer approximation of what’s coming out the speakers.
2. In PPM, there are winners and losers. And the numbers will often be different than what we’re used to seeing in the diaries. But isn’t that to be expected? How much of the protests we’re hearing about PPM are legitimate complaints about sample size and MRC accreditation, and how many are sour grapes about how certain formats just don’t look as good in PPM? When there’s a rules change in any sport, teams, players, and strategies are going to be affected. And who really thought the way formats performed in the diary were “real” anyway? In PPM, respondents can no longer “vote” for their favorites. Measuring real exposure/listening to radio is a whole new game, and every format will have to adjust accordingly. PPM is a game-changer, and the great players will figure out how to make it work for them. Sometimes, reality truly bites.
3. What is the net effect on the advertising community? I blogged about this some weeks back, and continue to ask the question about the larger issue of radio’s image among advertisers and how this controversy has the potential to further destabilize radio’s financial foundation. Radio has serious perceptual problems to begin with. This Arbitron PPM outcry creates even more doubt about whether radio truly gets it when it comes to electronic measurement. Tom Taylor has a great piece that provides perspective from an agency point of view. It appears that the advertising trade press and many agency types are willing to be patient and expect there to be bumps in the road with PPM. They’ve been through this before with Nielsen, and don’t seem surprised at all by these growing pains. But the bottom line is that they want electronic measurement and strongly imply that it will have a positive impact on revenue.
4. Arbitron has to get it “right.” Industry leaders putting pressure on Arbitron are correct – as complicated as the PPM rollout is, they must solve these problems. Radio execs are paying the bills, and have every right to expect this new service to be legit, from top to bottom. And in this regard, the issues are daunting, especially when it comes to the 18-34 problem/issue. Jacobs Media was the first to statistically identify the “cell phone only” problem a few years ago, when our first Tech Poll showed the alarming percentage of young Rockers that had dumped their landlines. PPM methodology represents an improvement over the diary, but it’s not enough. If young formats are to be counted fairly, different methods of locating/enticing 18-34s will have to be implemented. Our business needs youth formats to become more viable in the worst way. They are the lifeblood of the radio industry, and yet, measuring this audience is an immense challenge. It is very expensive to integrate “cell phone onlies” into any research format, but every attempt needs to be made to bridge this gap and provide these consumers with the chance to be in the panel. This is the top issue for PPM. It took some cajones for Arbitron to suck it up, shut it down, and hopefully, get PPM fixed. Perhaps they should have seen it all coming, but the bottom line is that they’ve taken their bath, it is costing them dearly on Wall Street, and now they just have to make good on the deliverables.
5. We can’t go backwards. It is fortuitous that Arbitron had diaries running in NYC, but if anyone thinks that there’s any sense in running parallel ratings – diaries and PPMs – think again. The diary as a ratings-gathering tool is hopelessly flawed, primitive, and out-of-step with the digital world. The diary needs to be replaced by electronic measurement, pure and simple. This is about making PPM work – and doing whatever it takes to make that system viable and reliable.
6. Broadcasters are pissed. It’s been a tough year, and ’08 isn’t projected to be any better. All of us have seen the results of the anger, at times splattered in many different directions. These are the times that truly try souls, to poorly paraphrase Thomas Paine. How radio reacts under times of duress will say a lot about our ability to redefine and re-energize our business. Will we panic or will we hunker down and figure out strategies that can transcend the new digital realities? In this confusing and depressing environment, Arbitron is an easy target. PPM is more expensive at a time when many stations are throwing employees out the door. And when Arbitron’s numbers aren’t on the money or broadcasters perceive arrogance, it’s easy to pile on.
So what does all this mean? And where should it go from here? Check back tomorrow for those thoughts.
Full disclosure: We have conducted research for Arbitron in both ’06 and ’07.
It amazes me that it took this long to even get electronic measuring. I mean think about it…..in this day and age, we’re still relying on paper, pencil and recollection to give us our “results” and shape the future!
Of course, we always try to make sure our blog is accurate. And our non-resident historian, Larry Rosin, points out that I misattributed the quote in this posting to Winston Churchill. It was actually Thomas Paine. We have since corrected the blog entry. I should clearly have used more “Common Sense.”