Nielsen now rating commercial breaks

Kai Ryssdal Jul 11, 2006

KAI RYSSDAL: The most-watched program on television last week was something called “America’s Got Talent” (whatever that might be). Twelve million people tuned in —amazing as that might be. Ratings numbers come from the people at Nielsen. Who until now have only rated how many people watch the actual shows. Not how many stick around for the commercials instead of running to the rest room. Curious, considering it’s the Nielsen ratings that help set ad rates. Come November, though, everybody will have some idea how many people are sticking around for the ads. We asked Abby KLAASSEN from Advertising Age to explain

ABBY KLAASSEN: Nielsen is going to start measuring the audience that stays through the commercial breaks. And, what they’re going to do is, take an average commercial rating for a particular program. So they’re going to take the audiences that stick around during the first break, the second break, the third break, however many breaks there are, they’re going to average that.

RYSSDAL: Now, I’d imagine that the people who buy the ad time are eager to get this number because, inevitably, right, it’s going to drop from the program time and thus they’ll have to pay less for those ads.

KLAASSEN: Well, you know, incidentally, the reaction is mixed because some advertisers say, “You know, this isn’t enough. We want to know how many people are watching our ad. We don’t care about the average of a program. We want to know during the 30 seconds that our ad airs how many people saw it.” Others say, you know it, this is a really good and significant baby step toward getting there.

RYSSDAL: What are the networks saying? Are the networks actually saying, “We believe this’ll result in some lower revenues for us?” Or are they sort of holding the fort and saying, “We’re going to see what happens.”

KLAASSEN: What’s interesting to me is that this is happening right now. And I think what’s spuring the networks on into saying, “Hey, we’ll go along with this,” is the whole growth in DVR households. You know, we’re seeing a lot more people DVRing or time shifting . . .

RYSSDAL: Tivoing, basically, right?

KLAASSEN: Tivoing, exactly. And, as of right now, the networks are not getting paid for those viewers who time-shift and watch their program, you know, a day or two later. And the advertisers have said “That’s because we don’t know they’re actually watching the commercial. Now, if you can come up with some sort of calculation or measure that shows us, OK, they might have time-shifted this but they didn’t fast-forward through the commercials, we might pay you for that.”

So I think the networks are saying, “OK, on the one hand we’re losing out on all those time-shifting viewers. On the other hand, you know, we could get paid for that if we show them how many people stick around.

RYSSDAL: Now, you know, there is this thing out there that lets you know exactly how many people are watching an ad or paying attention to an advertisement. And it’s called the Internet.

KLAASSEN: This is true. We’re definitely seeing the Internet’s influence on television right now. The Internet is a very accountable medium. And it’s causing all the other media to become more accountable in their measurement as well. And so that’s clearly playing a part here. TV is saying, hey, we’ve gotta step up to the plate ’cause we’re losing money to online video.

RYSSDAL: Abbey Klaassen covers the media industry for Advertising Age. Abbey, thanks for your time.

KLAASSEN: Thanks, Kai.

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