The Death of the Diary? Not Quite

It’s an often-forgotten fact of television audience measurement that Nielsen still measures 15o of the 210 U.S. television markets using nothing more sophisticated than old-fashioned paper diaries.  According to an announcement from Nielsen yesterday, that might finally be starting to change.

Yesterday, Nielsen announced a plan to incorporate set-top box measurement into those markets that are currently measured exclusively via paper diaries.  Nielsen also announced a plan to incorporate a new measurement technology, called a code reader, into the measurement of these local markets.  Nielsen hasn’t provided many details about the code reader, other than to describe it as a proprietary technology with a “watermark-enabled capture device”; but this incorporation of an additional measurement technology is certainly in keeping with the current trend in all areas of audience measurement toward hybrid measurement systems.

This hybridization also extends to the fact that, even with data coming from set-top boxes and the new code reader, the diaries will still be in use in these markets.  Clearly, these diaries are tenacious.  Even the introduction and implementation of new technologies in local TV markets can’t quite bring about their demise.

This persistence of the diary method is a reflection of the fact that diaries remain an appealingly inexpensive way of gathering the demographic data that advertisers continue to value (it should be noted that whether advertisers are right or wrong in placing such value on demos is increasingly debatable).  The bottom line is that local people meters continue to remain too expensive to employ in markets outside of the top 60; and so a hybrid approaching utilizing other less expensive methods is the logical next step.

It’s not surprising that Nielsen is now making some significant headway in bolstering its measurement methodology in diary-only markets.  The past few months have seen Nielsen competitor Rentrak (which employs set-top box data) make significant inroads into local television markets.  The stream of announcements from Rentrak over the past few months about the signing of new station group and ad agency clients has been steady, to say the least (here’s the most recent).

This scenario of course leads to that fascinating Catch-22 in audience measurement: competition is the most effective way of producing methodological improvements, yet marketplace stakeholders face powerful incentives to support just a single measurement system (see Audience Economics and Audience Evolution for discussions of why this has more or less always been the case).  But history tells us that, even if Rentrak ends up being the latest in the long line of upstart measurement firms that has failed to unseat Nielsen, they will succeed (as they apparently already have) in nudging the incumbent down the path of methodological innovation.

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