It appears that media companies are taking to heart last year's predictions about advertising and audience measurement. On Tuesday, CNBC announced it is dropping Nielsen measurement of its daytime audience and instead will rely on Cogent Reports, the syndicated division of Market Strategies International, a marketing and research firm.
The reason to drop the venerable ratings provider? CNBC wants to measure out-of-home viewing of its channel, as it believes its target audience--business executives, financial professionals and investors--does a lot of its watching in offices and at the airport.
The business news network, according to The Wall Street Journal, feels it's leaving money on the table when they negotiate with advertisers, because Nielsen doesn't measure its audience accurately. "If we can't count people the right way we can't get paid the right way," Mark Hoffman, president of CNBC, told WSJ.
CNBC's move may be the first sign that traditional TV companies are about to make a sharp turn away from traditional ratings measurement to companies that offer much deeper and more detailed analytics--which work particularly well for measuring TV Everywhere audiences.
But the network's decision may also be "self-serving," according to Variety's Brian Steinberg. A large chunk of CNBC's viewers are indeed out-of-home, but the erosion of its audience--2014 was its least-watched year since 1995, WSJ noted--could also be attributed to its viewers having access to other digital sources for their financial news, he wrote.
Furthermore, if CNBC's shift to Cogent Reports were the best solution, Steinberg feels that NBCUniversal would have lumped in other programs as part of the measurement deal.
In any case, it's clear that companies are increasingly interested in adding more measurement and analysis to the mix.
"The end result, of course, is that advertisers will have to work a lot harder to place their commercials," Steinberg wrote.
The challenge involved for advertising placement could mean a big boost for programmatic online video ads--an automated method to buy and place digital ads. Brightroll CEO Tod Sacerdoti, in an op-ed for VentureBeat, pointed out that the programmatic digital video ad market will triple this year to more than $2 billion.
"After such an eventful year, 2015 will be the year that digital video advertising fully 'grows up'," Sacerdoti wrote.
Of course, Brightroll is itself an ad platform, acquired last year by Yahoo for $640 million as the search giant puts together more pieces of its online video strategy.
Andrew Snyder, vice president of video sales at Yahoo, recently told FierceOnlineVideo that their data predicts "significant growth" for online video advertising this year. More brands are choosing to follow consumers onto multiple digital devices, he said, something Yahoo has been preparing for with its redesign of Yahoo Screen.
"Yahoo Screen is an important element in our overall strategy, but in addition to Screen we're focused on connecting our advertising customers to consumers who watch video, regardless of where they watch."
With that multi-device video strategy in place, Snyder said Yahoo is "focused on connecting our advertising customers to consumers who watch video, regardless of where they watch. ...We're also in a position to bring the superior data and targeting capabilities that Yahoo offers across the largest video viewing footprint on the Web today."
Brands are very aware of the changing consumer landscape when it comes to online video viewing, he added.
"They see the same things that we do, which is that television consumption is relatively flat, whereas digital video consumption is up nearly 30 percent year over year," Snyder said.
Those observations could spell out interesting times for both traditional television and the advertising industry as a whole.
For more:
- The Wall Street Journal has this story
- Variety has this story
- VentureBeat has this story
Year in Review: Online video market surges forward as streaming options grow in 2014: Year in Review
Related articles:
Video execs predict future with voice, gesture interfaces and cheaper, smaller content bundles
Control of online video advertising begins to take precedence for OTT players
Pai raps Netflix for not joining Streaming Video Alliance
Ad bubble? ION Media Networks' Burgess thinks so