Arbitron Reports PPM Trial Results, Prepares Broadcasters for “Currency Change.”

Michael Hedges September 26, 2005

The US media research company shared results from the extensive Houston, Texas trials. Measured with the Personal People Meter (PPM) people “tune into more stations more frequently but they listen for shorter periods of time,” said Arbitron/PPM President Pierre Bouvard. This was no real surprise as earlier Arbitron test results were similar. And, if broadcasters bothered to ask, electronic measurement for radio in Switzerland, now in its fifth year, has shown the same patterns.

The latest major announcement came last week as US broadcasters commiserated at the NAB Radio Show in Philadelphia. Arbitron’s PPM field trials in the Houston market came up exactly what the US radio industries CEO and accountants want to hear: dump those expensive morning shows since “morning listening has always been overstated” and even marginal stations can get a piece of the ad pie because PPM measures everything the survey subject is exposed to. And, not to parse words, all that cost savings can be invested in the more expensive PPM based surveys.

American radio programming consultants made fortunes once they learned to tailor their “findings” to receptive companies and their managers.  And it’s much the same for Arbitron. Every channel gets a piece, even if small, of that ad pie and can rid themselves of expensive marketing and DJ line-ups. Marketing matters not when exposure – and not “listening” – is measured.

The greatest salespeople have been described as being able to sell a blind person eyeglasses. Arbitron, the US company that sells radio audience data, is taking this to new heights. They’re trying to sell matches to people drenched in gasoline and ready to explode. Radio companies are feeling the squeeze from new media for ad revenue and, at least in the US, falling audiences – measured the old way by asking survey subjects to recall what they’ve tuned to.

“Radio has never experienced a currency change. Cost per points will have to be reset. The number of commercials to hit reach and frequency goals will have to be rethought,” said Bouvard.

It’s always stunning to watch as the currency of trade moves farther and farther from the producers. For ad based media, agencies and media buyers hold absolute power so long as no one – or even handful – of media options dominate. With the wide variety of new media, including satellites in the US and digital radio in Europe, some of the leverage has even moved to consumers. Not something either producers or media buyers had in mind.

The extent to which people “listen” to radio, television or podcasts via the internet, cable or satellites staggers the entire concept of broadcasting. Measurement needs to reflect this. Whether the Arbitron PPM or other available passive electronic measurement devices, media measurement is clearly moving toward a multi-media “currency.”  This is essential. Period.

“Radio’s always been positioned as a frequency medium because it’s relentlessly retail oriented,” said noted media expert Erwin Ephron, quoted in AdAge. “But that’s not the way buying is done nationally. Radio has reach capabilities that are often ignored.” He said the PPM figures make that argument “more compelling.”

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