What Gets Measured, Changes Media

Michael Hedges June 19, 2007

Accountability and technology are driving media measurement. These are also the twin drivers of media management. Content, however, drives media consumers. Who wins?

A shock-wave went through the corporate world 25 years ago when a couple of bright young management consultants detailed organizational excellence in seven basic qualities.

In Search of Excellence… by Tom Peters and Bob Waterman became a world-wide best seller, a first and only for a book on management.

Peters and Waterman had significant scholarship behind them, coming from the Stanford business school, located in midst of what the world knows as Silicon Valley. They began with the premise that an excellent organization – company, charity, government – rises above the others by serving all its stakeholders – customers, shareholders, employees, civil society. What they attempted was a quantification of excellence.

What Peters and fellow McKinsey consultant Waterman learned from big organizations and small was success came more and more from knowing rather than simply making or doing. They wrote about customer satisfaction, nurturing the creative and managing by wandering around.

Management science – from the days of Edwards Deming – has long trained executives from two similar disciplines: engineering and finance. Peters and Waterman, both from engineering disciplines, foresaw the coming of knowledge organizations where solutions are found inside customers’ heads.

Media has always been in the knowledge trade, though not articulated until the dot com boom. Publishers viewed their success in the number of copies sold or amount of advertising sold. Broadcasters invented audience measurement to convert a quantifiable approximation of audience size into money from advertisers.

Statistical and survey methods perfected more than two generations ago founded the currency of media measurement still, mostly, in use today.

Product managers measure brand strength in many of the same terms Peters and Waterman used to quantify excellence.

In the two decades since Peters’ equally famous article “What gets measured, gets done”,  managers have focused on the obvious: measure everything. Measure everything and we’ll figure out later whether or not it means anything. Companies like Oracle make fortunes facilitating the storage and manipulation of vast amounts of data. In the media business, nothing is more frightening than a junior media buyer with a PowerMac and version 12 of SPSS.

There is another side to this popular incitement to measurement: What we measure is what we do.

Holy Grails…hardly.

The long running discussion about passive media measurement provides a superb example of curing a problem by changing the patient.

About the time Peters and Waterman’s book came to rest on every managers’ desk, the ad people – largely those working with national and international brands – started moaning about complexity. Television was metered, newspapers were counted, radio was surveyed, most every other medium was taken of faith and there was no internet. Come together, they called out. Give us one grand unifying portal to knowledge, the Holy Grail, preferably with huge data tables.

Media people were reading from the same book. Big and not so big companies added research departments filled with young people not trained in journalism or theater but statistics and survey methods. Focus groups became the rage. Media channels became media brands. It was the era of MTV.

When the dot coms imploded in 1999, chip makers did not. Computing speed and processing dimensions grew exponentially. Anything that might be done with a microprocessor was done…and constantly made better, faster and smarter. This landmark development in technology made possible this digital era we now enjoy – from high speed web access to HDTV, mobile phones to iPods…and don’t forget statistical modeling of huge and complex databases. And don’t forget electronic meaurement.

All things became digital…

There was a wonderful study of consumers’ time spent using media, done in 2005 by an American university. At the turn of the 20th century people on average were spending about an hour a week with media, then largely print. By the end of the 1930’s radio increased that time spent with media to about 5 hours a week. When television crossed the line of 50% of all households world-wide – in the mid’60’s – people were spending 35 hours a week with media. That average person in 2005 was spending 63 hours weekly with media. Media is now the leading life activity.

Ad people are quite good at spotting trends and this one looked good to them. People spending more time with media must mean more money to spend on media. It hasn’t worked out that way. Global ad spending as a percentage of global wealth generated is actually going the other direction. 

The ad people see a simple solution. Change the system. Out with the old and in with the new; the old being measuring how people behave, the new being measuring exposure. Their calculus is simple and elegant.

Digital media – not only the internet, but everything from games to phones – has flattened the media landscape. Individual media brand channels (MTV, for example) have found their strength sapped by Web 2.0 channels that jump from one platform to another. And consumers are overjoyed by the choices.

The first measurement concept thrown out the window is audience recall. It’s a wonderful way to measure brand strength but media brand strength in the age of YouTube is meaningless to advertisers spending money to get people to spend money.

When people had only 2 newspapers, 2 TV channels, 6 or 7 radio stations and no internet to think about they fairly well knew what they were seeing, hearing and reading. Decisions were simple.

The shelf-space for media in the great department store of life was orderly. Forget that! Now people are stumbling around amidst boxes and packages stacked to the ceilings and falling to the floor.

The next measurement concept out the window is singularity. Circulations figures are an anachronism for old style currency for old style media. Nobody – in big advertising, at least - cares about an individual newspapers’ circulation share. Show us, they say, the portion of daily media time people spend with all media. And show us which people interact with the ads.

If changing systems to measure radio listening across platforms caused a storm – radio accounting for about 5% of all advertising – imagine the hurricane this is causing the print media.

Also out the window is limiting measurement to at-home consumption. Sure, big screen digital TVs with surround sound are fixtures in living rooms but the total media experience is more and more – and more obviously – out of the home. We have newspapers to look at – more often free sheets – while we’re in the bus or train. We have the radio on while we’re in automobiles. We carry mobile phones with us. We see web pages upon web pages when we’re at work or school. We listen to podcasts wherever we want, whenever we want.

The solution that everybody agrees on – in theory, at least – is measuring cross-platform exposure. Home may be where the heart is but it's only one place the media is. A significant part of media consumption is not by choice. And, of course, all media is multi-platform.

P&G chairman AJ Lafly – musing recently on his company’s 2006 results -  turned Tom Peters’ phrase one more time. He said, “What gets measured, gets sold.”

One other trend has the ad people and the media people in a stir - performance-based advertising. Media buyers call it accountability. The search portals – Google, Yahoo and now others – have opened the world of Web 2.0 advertising – the click-through ad. They pay only when somebody buys. Brand advertising might never die but the money is moving to a system that proves that ad exposure yields sales.

P&G’s chief marketing officer Jim Stengel said, “What we’re looking for is not just ratings but receptivity to the message.”

On the front of it, the idea that measurement changes media is tantalizing.

Cross-media measurement will force all media outlets onto all platforms…or, at least, as many as they can. We see this now with specialized magazines, once a perfect tool for targeted marketing. Hachette has moved 300 specialty magazines to web-only offerings. News media is equally quick to adapt. Good ratings are wonderful but being indexed by Google News is the difference between life and death.

Content producers – once they were called publishers and broadcasters – will spend far less on marketing their ever evaporating brands and more on using IP numbers for targeting specific bits of content to appear on targeted aggregators and search tools.

Some media watchers believe – and I admit to being rather agnostic on this – that all media consumption will be consumed on screens. Screen time will be everything. There’s the big screen – television – in the living room…or pub. There’s the middle-sized screen – the laptop or PC. Then there’s the tiny screen – the mobile device. Nothing else will matter.

I was recently in a conversation with a particularly astute radio broadcaster working for a company highly invested in the new digital platforms. We were talking about the effects of radio audience measurement changing to radio exposure measurement. He, frankly, doesn’t care what happens.

“I still have to sell ads,” he said, “whether the ratings are good or bad. There are a thousand ways to get that done.”

He suggested that his company’s rather substantial marketing budget would be better spent buying tens of thousands of tiny RFID transmitters, scattering them around his various markets and pipe-lining those embedded codes used in Arbitron’s PPM.

“It won’t be as much fun,” he said, “with no brand promotions and fewer high-value performers, but you’ve got to go where the money is. Things change.”

Adapted from a presentation by Michael Hedges June 18, 2007 at the GfK Praha Media Brunch - Electronic Media Measurement / European Perspective - Prague, Czech Republic

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