“What Gets Measured Gets Done”

Michael Hedges April 21, 2005

What and how we measure media changes what media does.
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This is the age of quantities. Mathematics teaches us that quantities can be simple and complex all at the same time. The simplicity and complexity of our quantity time is represented perfectly by all things digital. Simplifying as much as possible into ones and zeros is more than a technological adjustment, it’s a step toward hyper-quantification, where everything is different and nothing is the same. Media has – almost completely – become a matter of quantities. We have 500 channels – and nothing on TV. Every aspect of media – which in its most basic form is storytelling – is now measured, described and explained in ever smaller units.

In this age of quantities mass media is consigned to the same fate as the dinosaurs, to be trampled by smaller, quicker and hungrier predators.  We can’t even count these new media beasts: they multiply so fast, sucking the blood – advertising – out of mass markets.  The advertising smarites want a new way of looking at – measuring – media. Granular units will be measured, an interesting linguistic derivative. Those same smarties want the most minute detail of those individuals quantified without ever speaking to them or seeing them because in that they do not trust.

Legendary management thinker Tom Peters said often and loudly, “What gets measured gets done.” Broadcasters, sales houses and advertisers – and, lest we forget, consumers of their wares – find themselves in a panic with the age of quantity as it represents, for some, a jolt to the system. Others are in a panic to get on with it all, fearing the worst – irrelevance. What and how we measure media – our storyteller – is likely to change what media does.  

Meter Reading: Radio Audience Measurement

We use the term “currency” to describe audience measurement, since it acts as an exchange medium between broadcasters and advertisers. It is the currency of sales houses and ad sales. Adopting a new currency for the trade between broadcasters and advertisers is about as easy as adopting a new currency of common trade.

Proponents talk about advantages and the march of progress. Critics say the system ain’t broke, so why fix it.  Just as with the euro, some people feel more comfortable with the old than with the new.

Since time immemorial radio audiences have been measured by interviews with real people, in person and more recently by telephone, typically aided by asking them to keep a diary of their station choices through a week. Nielsen’s first system for measuring radio was, however, a mechanical device inside console model radio sets that recorded which buttons had been pushed. This was in the 1930’s.

For broadcasters to monetize their commercial offering audience ratings are essential. Measurement benchmarks – such as creation of joint industry committees – can be correlated directly to benchmarks in ad spending.

Advertisers and media buyers have come to make decisions based on this currency as hard data, dismissing any subjectivity. Ad placement is based on validated estimates of how many people listen to a given station or channel, when they listen, sometimes where they listen with the ultimate goal of getting the sponsored message in front  of as many people as possible – at the lowest possible cost.

Good sales people and a good sales story – arguably the creation of advertising itself - can have its effect but the bottom line is that ad placement is based on audience estimates derived from surveys of real people.

Interviews and diaries have worked fairly well for broadcasters, sales houses, media buyers and advertisers…until fairly recently. The biggest reason it’s worked well for all stakeholders is that the methods and results have been studied, analyzed and refined. It may not be perfect but it’s well understood and that raises the value of any currency.

Recall surveys measure one level of brand strength. The human brain being truly wonderful, manages to limit what we remember to what we perceive as significant or important. And survey instruments – like diaries – are designed to jog that memory – listing every channel in a survey area. – tend to reinforce known visual references remembered from other media. This has worked well for broadcasters – some more than others. A channels measured audience and its marketing budget seem related.

Measuring brand strength has worked well for advertisers who place a premium on co-branding opportunities. This has worked well for broadcasters – some more than others – as that premium is monetized in the form of sponsorships. In some places sponsoring is radio’s fastest growing revenue stream.

But when economics become uncertain and market conditions change, businesses, advertisers and media people, have panic attacks. 

Changing radio measurement from diaries and personal interviews to electronic devices is more than just changing methodologies. It’s about changing the exchange mechanism.

Radio Channel to Media Brand

At the base of it, all media measurement is changing just as all media is changing.  Part of this change is, indeed, the revolution brought on by digital technologies as producers and consumers engage new platforms. The term “radio station,” implying AM, FM, shortwave or long wave, may well disappear and give way to media brands appearing on all or combinations of platforms. And there will be more of them. Media researchers, broadcasters and advertisers have a justifiable fear that survey subjects won’t be able to cope with the breadth of it all. Surveys of recall just won’t be good enough.

Major advertisers and media buyers have been interested for more than a decade in single-point measurement. The idea isn’t simply a streamlining of the research system to measure all media through one survey mechanism. Advertisers interests are changing; from measuring things – a stations audience – to measuring individuals – how a person divides their time among all media and how that relates to purchase behavior. Advertisers are looking for this granular detail of consumers behavior. Jim Stengel, Chief Marketing Officer at Procter & Gamble, said “What we’re looking for is not just ratings but receptivity to the message.” He also said advertisers needed to look beyond the 30 second spot.

Advertisers have long been wary of media surveys based on recall. But they understand it. Television has been measured passively – with the limitations of set-top monitors – for years. Newspapers and magazines report circulation figures augmented with recall surveys. Outdoor advertising relies on vehicle counts to extrapolate exposure.

But the internet has given advertisers more: click-through rates. Ads specific to regions, languages and even interests can be shown to internet users. And media buyers can be shown – in real-time -  who might see or hear the ads and, most important, whether or not people follow through and buy. Developers of mobile media - phone companies, networks and hand-set makers - are following this closely.

Media measurement with one amazing device seems to satisfy the hopes and desires of every media buyer.

Changing the way we count and we change comparative values. It can alter the economics. Changing the way media is measured changes media business models.

Electronic Measurement Devices

Research suppliers have watched two related and converging trends. Survey subjects are increasingly time-poor, particularly in segments of most interest to advertisers. People have become increasingly reluctant to spending 10 or 20 or 30 minutes for an interview or filling out a diary. For the research suppliers this means two things: higher sample error and increased cost.

The explosion of media – often multi-platform – has also caused another research issue. Where perhaps a decade ago a radio market contained 15 or 20 channels, today – with the increased demand by both public and private broadcasters for more licenses, new platforms like DAB, cable radio and radio via the mobile phone and the blurring of distinctions among those platforms – a person might be exposed to far more.  Conventional wisdom still holds that people can remember seven to ten objects in any category.

Add to this the interest in – demand for – single point measurement by media buyers and research suppliers had strong incentive to look for a solution.

Arbitron first developed its Personal People Meter or PPM – to a large degree – because of falling survey response rates in its largest market – the United States. The PPM has been under active development since the early 1990’s. The PPM now measures audiences for internal programming needs for VRT and VAR in Belgium. The device is also used to measure television in Quebec, Canada and Singapore. TNS is licensed to market the PPM in Europe.

The PPM is unique among the currently available devices for radio measurement. The device – contained in a small box that looks like a pager – detects a coded, imbedded signal – referred to as a watermark – that rides inconspicuously within the normally transmitted signal. That signal can contain a time-stamp – identifying the time and date of original broadcast – and a platform identifier – differentiating among AM, FM, DAB, DRM, as well as TV, the Internet or cable. Equipment for encoding is located with the broadcasters audio processing equipment. If used by a panel, data is downloaded daily through a telephone connection. The device has sufficient memory to store a weeks’ data.

In more recent years Arbitron has pursued more options for PPM moving toward single-source measurement. Since PPM can measure any radio frequency source, Arbitron includes in-store audio, cinema, any out of home media – like television - as a measurement target. Radio frequency sources – called RFID – can be placed on or near outdoor posters – billboards – and – in tiny chip form – the size of a pin-head – on magazine and newspaper pages. All of this has thrilled media buyers and ad agencies.

Arbitron once measured both radio and TV but ceded the TV business to Nielsen several years ago. Clearly Arbitron does not want to get into a contest with Nielsen for US television measurement. Arbitron’s CEO Steve Morris said recently that one would win and the other would be destroyed. Nielsen obviously sees the same consequence, so joint ventures are on the table. One is called Project Apollo, which combines Arbitron’s PPM data on media usage with Nielsen’s Homescan consumer panel. Launch date for Project Apollo has been delayed until the second quarter of 2006.

The major multi-media field test for PPM in Houston, Texas has also been delayed. Panel and selection is underway. 90% of Houston media outlets – radio, TV and cable – has finally agreed to participate. The test will also measure in-store audio, even the in-house audio at the Houston Livestock Show, which takes place during the test period. Nielsen was to have participated with Arbitron in the day to day operation of the 90 day trial. According to an email from Arbitron President for PPM development Pierre Bouvard last Friday (April 15), Arbitron has withdrawn the invitation to Nielsen.

Arbitron has invested US$80 million in developing electronic measurement. In the last three years the company has re-deployed several very senior executives to PPM development. Clearly Arbitron is investing considerably in changing media measurement.

RadioControl is a creation of Mathias Steinmann, former research director at Switzerland’s public broadcaster SSR-SRG idée suisse. His system for radio measurement developed from the Telecontrol set-top box for television measurement.

The Radiocontrol – now called Mediacontrol – device collects and codes minute snips of audio. That audio is then matched with real-time audio collected within a survey area. The device itself is housed in wrist-watch.

Lab tests began in 1997 and from April 2000 Swiss radio broadcasting has been measured with the RadioControl watch. A UK survey powered by the RadioControl watch – financed by a broadcaster unhappy with results from the diary-based RAJAR surveys – has been offered since 2003.

The newer MediaControl device can also collect RFID signals, with outdoor advertising in mind. Buttons and a screen menu have been added so the survey participant can manually note their location and record time spent with newspapers.

GfK, the large German market research company, bought out Dr. Steinmann’s majority interest in Telecontrol in 2001. Several GfK offices offer interview and diary-based radio audience measurement and several have conducted non-comparative tests of the RadioControl device. Dr. Steinmann is CEO of Telecontrol and directs its several subsidiaries.

A bit more than a year ago the Italian market research company Eurisko – part of market research giant NOP World - unveiled their World Media Monitor.

Eurisko has benefited from the development research and testing by Arbitron and RadioControl but, also, from their own work measuring outdoor advertising. Eurisko’s GPS based AudiPoster survey is the currency for outdoor measurement. The World Media Monitor merges a GPS system and audio matching.

One significant difference between the Eurisko device and the others is its container and the way the container can be used. It can be a necklace, a watch, a hat pin, and is less dependent on open exposure. It can be left in a purse or shirt pocket and function correctly. This isn’t simply a fashion statement: the audio gate samples far faster than the current configuration of the RadioControl device.

Not in the European market but, perhaps, an indication of the interest of advertisers in collecting data differently and through passive systems is the offering of Navigauge. This is a GPS based system that matches a mapping position with station’s in use in an automobile. It produces a clever map that locates the automobile and outdoor posters in the area and then notes the station the radio in the car is tuned to. It captures radio listening information by sampling the intermediate frequencies produced by the car radio. For that reason, it only samples FM stations.

IPSOS is a major world-wide market and audience research supplier. The company provides field work for the RAJAR surveys in the UK, the Media Analyse (ma) radio surveys in Germany and ad hoc media surveys in many other countries. Word spread in February that they were to unveil a passive measurement device this spring. IPSOS CEO Robert Silman indicated in early April an announcement would be forthcoming, perhaps by the end of the month. A device is being tested internally now but the company has released no detail. It is expected to use either watermarking or a combination of watermarking and audio matching. IPSOS recently lost the contract for BBC radio/TV measurement to GfK. The company also lost out to GfK – announced April 15 - in the bidding for another large information services business, NOP World, which just happens to own Eurisko.

All of the main three devices are marketed as multi-media measurement tools. One reason is the influence of ad agencies and media buyers and the allure of single point measurement. Another reason is cost. Electronic measurement doesn’t only double the cost of audience surveys, it increases by five fold or more. Advertising agencies don’t pay, broadcasters do. The suppliers quickly determined that one solution to cost resistance is to spread the cost among all media, notably including outdoor advertising and – sometime in the future – print media.

The Arbitron system requires the active participation of broadcasters. Audio-matching systems do not. This has particular relevance in Europe as broadcasters typically do not own and operate transmission facilities.

None of the three main suppliers have yet passed the big test – adoption by a major joint industry committee.

Adaptation presented at the AER/egta Spring Radio Conference, Brussels, Belgium, April 21, 2005

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Arbitron's PPM Scores...Shuttle Launch - August 30, 2005

text of Arbitron press release, slightly edited

According to preliminary television estimates from the Arbitron Portable People (PPM) market trial underway in the US city Houston, Texas, out-of-home viewers were a significant percentage of the audience for the live coverage of the space shuttle.

During the launch on 26th of July, 118,300 persons (age 6+) were watching the shuttle coverage out-of-home, accounting for 11.3 percent of the total audience of 1,048,900 viewers (age 6+) to the 62 encoded stations and networks in Houston. For the five local broadcast stations and four cable news networks covering the shuttle launch, these 118,300 out-of-home viewers accounted for 25 percent of the total 474,000 viewers in their combined in and out-of-home audience.

“With its unique ability to track exposure to television no matter where it occurs, the PPM quantified, for the first time, the complete television audience, in and out-of-home, for the liftoff and landing of the Discovery,” said Pierre Bouvard, president, Portable People Meters, Arbitron Inc. “We’re beginning to learn that out-of-home television viewing is more than just men in bars, watching sporting events in the evening. It’s also women at work in the middle of the day, a previously unreported audience for stations and their advertisers.”

Arbitron’s PPM Successfully Tracks New Terrestrials – August 26, 2005

text of Arbitron press release

Arbitron Inc. has demonstrated that its Portable People Meter (PPMSM) system has the ability to track the newest distribution channel being adopted by terrestrial radio broadcasters – HD Radio™ technology – including its ability to multicast. Arbitron tested the PPM system with HD Radio technology to determine if separately encoded sub-channels could be tracked by its portable audience measurement system. The trials, which took place the week of July 28 on the digital channels of a radio station in one of the top ten metros, showed that separately encoded multicast channels did not conflict with the main channel’s encoding. In addition, the PPM codes, which were unique to each of the digital channels, were properly identified by the PPM.

“The industry is currently debating what to call their HD Radio multicast channels, which is important for radio when it comes to promoting these new options to their listeners,” said Pierre Bouvard, president, Portable People Meter, Arbitron Inc. “But in terms of measuring listeners to HD Radio multicast channels, the PPM has solved the problem. It doesn’t even matter if a listener does not know the names or slogans that broadcasters are using to differentiate analog signals from digital signals or primary digital channels from multicast sub-channels. With the PPM, each distribution stream can have a unique identification code. If a listener hears it, the PPM can identify it with near-perfect certainty.”

Previous tests with HD Radio technology have demonstrated that the PPM system can recognize a PPM code in a sub-channel that is encoded at a rate as low as 12 kilobits per second.

The Arbitron Portable People Meter has performed successfully with virtually every significant type of audio distribution and compression system. These include some of the most advanced audio technologies such as podcasting, Dolby, HDTV, satellite uplinks, Digicypher and Videocypher.

Note 1: Arbitron continues to stress that their PPM can measure any platform. With other competitors for electronic measurement (EM) effectively sidelined (GfK) or “in development” (Ipsos, Eurisko) Arbitron charges on.

Note 2: In their marketing all EM providers point to a landscape-leveling effect of measuring exposure rather than recall. The most well-known stations and channels will no longer have brand-strength advantage. Try this logic: stations and channels with the greatest brand-strength have because of what? Investment. The weakest are in some way – brand-strength or financially – impoverished. So, the strongest brands are generally the biggest brands and therefore most able to pay the increased cost of EM…but…most likely to be negatively affected by the results. Of course it could also be argued EM has a positive effect on broadcasters cost structures: cut the marketing budget, no more DJs, just play the hits. The saving could then be poured into, you guessed it, electronic measurement.

Note 3: Read everything about electronic measurement while listening to the theme music to “The Outer Limits.” Tin-foil hats provided.

Arbitron's PPM to Measure Podcasts...Grandma's Gold Teeth Next? - August 23, 2005

text of Arbitron press release

With podcasting making headlines as one of the latest technologies being embraced by terrestrial radio broadcasters, Arbitron Inc. (NYSE: ARB) has demonstrated that its Portable People Meter (PPMSM) system has the ability to track audiences who listen to this new method of radio programming.

During the week of July 18, Arbitron encoded several podcasts by Clear Channel’s WHTZ-FM (Z100) in New York, that were uploaded to the podcast portion of Apple’s iTunes Music Store. The Z100 podcasts were then downloaded to an MP3 player and played over headsets using the PPM headset adapter. The PPM detected and recorded the unique identification codes that were embedded in the MP3 file.

"We're committed to delivering Clear Channel Radio's outstanding original content through a wide variety of delivery methods, including podcasting," said John Hogan, Clear Channel Radio president and CEO.

“Podcasting is a very different distribution system for traditional radio and the successful test of the PPM should further build confidence in how well it works with all types of audio programming,” said Pierre Bouvard, president, Portable People Meters, Arbitron Inc. “The state-of-the-art encoding system used in the PPM does a better job of identifying alternate distribution platforms and time-shifted audio content than any other approach to portable electronic audience measurement that we’ve seen.”

The Arbitron Portable People Meter has performed successfully with virtually every significant type of audio distribution and compression system. These include some of the most technologically advanced audio technology such as Dolby, HDTV and satellite uplinks Digicypher and Videocypher.

Editors note: A call has been placed to Brad Bedford to ask about toasters, garage door openers and grandmas' gold teeth. She's said for years that she hears that AM station from Alaska.

Reality Bites Electronic Measurement - August 18, 2005

Ad agencies, media buyers and research companies continue their complaint that radio broadcasters are slow to pick up on the greatest media innovation since the TV remote control: electronic measurement.

Inundated with validation studies and performance tests broadcasters face two conflicting realities. Adopting electronic measurement, and throwing away the diary, will please media buyers who will, hopefully, toss more ad money toward radio. But measuring exposure rather than brand strength means changing forever the production and marketing of radio channels.

There is no guarantee that media buyers will move more money to radio just because the measurement changes. Media buyers are moving more money into the internet and away from almost all other media. The more astute broadcasters notice this as well as just how rapidly consumers have moved to multi-platform media.

Aside from using audience measurement as currency of exchange for ad spending, broadcasters are looking for the research to tell them what those consumers are doing…and not simply what they’re exposed to.

Arbitron's PPM Has More Inside - August 3, 2005

text of Arbitron press release - ftm seeks reliable translation

Arbitron Inc. has been awarded three new patents for its Portable People Meter (PPMSM) system, covering enhancements to the amount of information that can be embedded into the inaudible PPM codes and improvements to the PPM’s ability to detect inaudible codes.

The “Encoding Multiple Messages In Audio Data and Detecting Same” patent (#6845360) covers the ability of the PPM system to handle multiple layers of identification codes simultaneously. This allows the PPM to track, for example, the network originating the program, the local station broadcasting the program and specific commercials aired within the program.

The multi-layer codes can also contain a time stamp that indicates when a program was originally broadcast. The time stamp allows the PPM to determine if a broadcast was time shifted by the PPM survey participant or delayed by the network affiliate.

“This enhanced encoding system gives the PPM a proven ability to identify the platforms that delivered a program to the audience. Platform identification is a requirement for any state-of-the-art ratings system, which audio matching technologies have yet to demonstrate a practical solution for,” said Ron Kolessar, vice president, Technology, Arbitron Inc. “By embedding multiple messages into the PPM code, Arbitron can positively determine the platform that originated a program, the outlet that delivered the program to the consumer, the individual commercial that the PPM survey participant was exposed to and whether the exposure took place at the time of the broadcast or even days later.”

“We’ve worked hard to keep PPM’s audience research technology state-of-the-art. The PM system we are using in Houston is far more advanced than what we used in Philadelphia in 2002,” said Pierre Bouvard, president, Portable People Meters. “As radio and TV broadcasters along with cable providers and Internet broadcasters embrace multiple paths for delivering their content to consumers, the PPM can tell the industry not only if they reached a consumer with their content, but which investment in delivery technology is getting the job done.”

The “Decoding of Information In Audio Signal” (#6871180) and “Message reconstruction from partial code detected by PPM” (#6862355) patents further enhance the reliability of detecting PPM encoded information.