Print this Article
RSSChicago Tribune
By Phil Rosenthal, Chicago Tribune
Jul. 22--PASADENA, Calif. -- Eyeballs aren't enough anymore. Advertisers want proof they're reaching television viewers' minds.
Challenged to show the value of network TV in an ever more competitive environment for marketing dollars, NBC has cut a groundbreaking deal with Toyota that not only offers the traditional promise that viewers will be exposed to shows on which the carmaker advertises but also that those viewers will be paying attention.
Jeff Zucker, chief executive of the NBC Universal Television Group, said Friday, "We're going through a revolutionary period in advertising and the way that advertising is done on television, the way advertising is measured on television, and hopefully we can be at the forefront of that."
The deal is the first of several that the General Electric Co.-owned network looks to make this fall in which an advertiser will get more than the standard guarantee of minimum viewership, as measured by Nielsen Media Research, Zucker said.
The network will also guarantee a certain level of viewer engagement, as recorded by IAG Research, an outfit that tracks the effectiveness of product placements in TV shows as well as audience attitudes.
IAG conducts regular Internet polls from a paid panel of approximately 1.5 million to find out how much respondents remember about what they've watched on TV and how they feel about it. If the shows Toyota sponsors fail to engage enough viewers, the network will compensate it with compensatory ad time, just as it would for a program that fails to draw a big enough audience.
"Marketers are under a lot of pressure for accountability. We're under pressure to help our clients," said Alan Wurtzel, NBC Universal's research guru. "It's a new world and, frankly, it's not that easy. You used to do the reach and frequency curve, and you went home at 5 o'clock. That's not quite the case anymore."
Driving this need to demonstrate the effectiveness of buying ad time on television is the fact that advertising and viewers are heading toward the Internet, where the effectiveness of advertising is seemingly easier to monitor.
The engagement guarantee reportedly does not account for channel surfing past ads, but it comes on the heels of Nielsen's recent announcement that it will measure the audience for commercials, just as it does for shows.
According to CBS research chief David Poltrack, the drop-off for ads is about 5 percent of the audience for broadcast TV shows and 10 percent for shows on cable.
"Is there anyone that has ever watched a TV with a remote control that does not understand that some people switch channels during commercial breaks?" Poltrack said.
As for engagement, he said IAG's figures show about three-quarters of the viewers tend to be engaged with the average broadcast network program, while just 60 percent of cable viewers meet that criterion.
"Looking at actual advertising recall, just over one-third of the broadcast network viewers were able to meet the criterion of recalling the average commercial running in the programs they have seen," Poltrack said. "The new advertising model will offer advertisers more precise information about how many people see their commercials . . . as well as direct advertising recall feedback, reflecting how well their message is getting through."
Zucker said the Toyota deal is only "a new model," not the model, and declined to say whether Toyota paid a premium for the engagement guarantee. But the network's engagement guarantee is not entirely unprecedented.
Last year Chicago-based media-buying giant Starcom USA had a deal along these lines with cable's Court TV. At the time John Muszynski, Starcom's chief executive, called it "a stake in the ground" and said he hoped that "three years from now, we look back at the Court TV deal and we all laugh and go, 'Look how archaic we were considering [the system] we now have."
Also, NBC has previously used so-called engagement measurements to show its Olympics advertisers they were getting their money's worth. But the use of engagement figures has not been done on this scale before.
"The difference is that with IAG, this can become a metric because they're out there talking to consumers every day," Wurtzel said. "What Starcom did with Court TV was a one-time custom study. That's why this is so unique, because it's like a rating. Every week we're going to get these numbers for a show, so we can use them as currency."
Kim McCullough, Toyota Motor Sales corporate manager of marketing communications, said in a statement that beyond audience size, Toyota wants "the networks to focus on attention-grabbing, highly engrossing shows that keep audiences tuned in."
Zucker said NBC, like other networks, is eager to show its value to advertisers. "So we're willing to put our money where our mouth is," he said.
-----
Copyright (c) 2006, Chicago Tribune
Distributed by McClatchy-Tribune Business News.
For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.
NYSE:GE,
