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Nielsen Ratings are a Toxic Force that Imperils Radio’s Future


Recently I was in a gathering of brands.

Not agencies, brands.

Among my conversations was one with the VP and Director of Global Media & Digital Marketing for a well known company that, among other things, produces one of the most famous brands of whiskey in the world.

I asked him: What do you spend your day doing, thinking about, worrying about?

He talked to me about the time he and his team spend creating personas representing the user segments of his brand. He talked about how all the tentacles of the brand arose from those personas and what those segments valued. He talked about the importance of innovation and ideas that reflected the brand’s values. He talked about the role of heritage in his brand and how he was leveraging it. He talked about the importance of music to his brand and how he was integrating artists who were fans of his brand into the marketing mix. He talked about the reverence he has for the power of his brand and the respect he has for its consumers, both the older ones who have been users for generations and the newer ones who have no stake in the brand’s history and are only interested in now.

Sales of his brands are, of course, critically important to him. But sales to him are an outcome of all the right branding decisions which run up to the sale and keep bringing consumers back for more.

As I listened to him, I thought: This man knows far more about his users and his brand’s DNA than 90% of the broadcasters in America. Since I’m in the research business I know full well that relatively few broadcasters place a value on knowing their listeners. But why is that?

The answer, of course, is ratings.

Why know the consumers when all you need to know is the ratings?

While my new friend values his brand and its consumers as the direct path to revenue, the average broadcaster values only ratings as that direct path to revenue.

And that’s despite the well-established limitations of conventional ratings methodology, the volatile spikes and valleys resulting from samples too small to be reliable. It’s despite the built-in biases against any form of ad-supported audio that doesn’t come from a radio tower (Pandora, Spotify, iTunes Radio, podcasting, I’m talking to you). It’s despite the controversies associated with one or two households in America’s largest markets that can dramatically skew the overall ratings results beyond what should be any broadcaster’s tolerance level.

Ratings, you see, encourage a broadcaster to seek ratings, not fans. Listeners literally don’t matter in an environment where only the intermediary called PPM matters. And while PPM devices “listen,” they certainly don’t hear or appreciate or value or shop or buy. PPM devices are not customers for our clients, people are.

You might argue: Well, there’s a correlation between ratings and fans. More of the former will yield more of the latter.

Not necessarily.

Today I spoke with a broadcaster who has the two highest revenue-generating stations in his market. Both are non-music stations. Both get punished by the ratings system well beyond what is either sensible or logical. Both are chocked full of fans – people who hear and appreciate and value and shop and buy. Both are as profitable as they are because they work for their fans and for their clients.

So what was my advice to this broadcaster?

Accept this as the new normal. The future will be one where your ratings matter less than your effectiveness in the marketplace.

In fact, show your clients what your listeners say when you ask them if they would carry a PPM device, if asked (hint: They will say “no”). If Nielsen is working overtime to un-sell your radio brand, then your radio brand should work overtime to un-sell Nielsen.

Indeed, what could you do for the benefit of your audiences and your clients if you were to take all that Nielsen money and invest it in your brands and in the results you generate for your clients?

We are entering an era in which your clients are becoming their own media brands – an era in which reach can be configured in lots of ways via lots of media that are not radio. It’s an era in which clients will need radio less and thus will have to want radio more.

And clients who want radio will want it because it works for them. Because it has fans. People who hear and appreciate and value and shop and buy.

Stuff that in Nielsen’s PPM pipe and smoke it.

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