Nexstar, the No. 1 owner of local TV stations, is making a significant shift in its approach to negotiations with advertisers, ditching traditional ratings in favor of a “cost-per-impression” model.
The new model, developed over the past year with third-party measurement firm comScore, incorporates digital, mobile and streaming viewing along with traditional linear broadcast tune-in. Broadcasters — particularly local stations — have been feeling the effects of the larger migration of viewing toward online platforms.
“This strategic move represents the next step in the natural evolution of audience measurement,” Nexstar Broadcasting president Tim Busch said in a press release. “Our sales force will be able to talk to all advertisers—big or small, national or local—in an informed, fact-based manner about maximizing the reach and effectiveness of their spending across every available media channel and every viewer will be counted, no matter where or when they watch. In addition, advertisers will be able to universally target their customers regardless of the distribution platform and monitor the results through unduplicated audience measurement.”
The TVB, a major TV advertising trade group, has been advocating for a new way of handling ad buys, launching the Local TV Impressions Campaign to draw attention to the issue.
Nexstar said its new model will give advertisers more information about who is watching what and when, as well as a common metric for the reach and effectiveness of both an individual commercials and entire ad campaigns. In its announcement, the company said it “recognizes that the business is changing and knows how to help advertisers utilize the new currency to drive better results.”
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Steve Walsh, EVP of Local Services at Comscore, called the move an “important step in modernizing the way buyers and sellers conduct business to better reflect the trends in video-consumption and to ensure that all viewing audiences are being accurately counted.”
Nielsen continues to have a relationship with Nexstar, both companies affirmed. After Nexstar’s announcement, Nielsen issued a statement saying it “fully supports the move to impressions.” Hearst and NBC have recently also expressed support of impressions, the measurement firm noted. “This is consistent with how national buys are done and enables cross platform comparability,” Nielsen said. “The move to impressions is also about capturing all audiences in an increasingly fragmented environment. Today if a rating is below .04 it rounds to zero. Moving to impressions shows the actual audience rather than leaving it on the cutting room floor.
“TV has traditionally been bought and sold on GRPs, with the increase of cross platform campaigns, stations are looking to use impressions rather than percentages for comparability across platforms. Nielsen has always provided clients with impressions and they are the foundation for all of our calculations. That said, ratings, reach and frequency will still have a strong place in the planning and programming processes. The need to know unique audience is critical to the marketplace.”
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