Business Strategy

To survive today’s media business, local stations need more than ratings

To survive today’s media business, local stations need more than ratings

After years of domination, traditional methods of measuring audience in the broadcasting business are finally facing existential threats. Traditional ratings methodologies are under attack from virtually all fronts. In early 2015, for instance, the business news network CNBC announced that it will no longer rely on Nielsen to measure its audience.

The problems with ratings methodologies are particularly a big issue for local media. Some local stations have been abandoning Nielsen as early as 2005 due to concerns about its accuracy. In 2014, Fox Television Stations Group almost dropped Nielsen. Stations like the Boston ABC affiliate WCVB have criticized Nielsen for years, claiming that their audience is bigger than ratings suggest.

Looking for audience insight beyond ratings

Data providers are moving furiously to upgrade their methodologies. In 2015, for example, Nielsen Media Research finally abandoned paper diaries, a nearly century-old method of collecting demographic data.

But while Nielsen and other data companies are scrambling to catch up, local stations are finding themselves hungrier for audience insight. With the rise of digital and streaming services, local stations are competing with more entertainment choices than ever before. In an era of fragmented audiences, the need to better understand the audience—and meet their needs—has never been more important.

Unfortunately, ratings alone don’t provide the audience intelligence necessary to make better business decisions. Put simply, ratings are not built to address the most pressing challenges facing the media business.

Here’s a look at some of the challenges facing local media and why traditional ratings aren’t useful in solving these issues.

  1. Increasing ad sales

Advertisers today have more choices than ever before where to invest their marketing dollars. They are also demanding guidance from local media companies on how to measure the effectiveness of their campaigns. Media companies need to be able to clearly demonstrate ROI.

More importantly, advertisers know that they need more than just a medium to reach consumers. They want to build a relationship with their consumers, and they’re looking to media companies to help facilitate that.

Other traditional ratings can’t help with this issue because these methodologies fail to catch new ways of consuming content. Nielsen, for instance, is on a frenzy to try to catch up with cross-platform measurement. But without a holistic view of how people are consuming content, local media can’t help advertisers optimize their campaigns.

Bridging the gap is important, and audience intelligence software can help. One example is Radio One, Inc., the largest media company primarily targeting the African-American community, which uses an insight community to differentiate itself from the competition through its unique ability to help advertisers make data-driven business decisions. As the video below demonstrates, Radio One uses audience intelligence to help its advertisers develop consumer-centric campaigns.

The result: more ROI for advertisers. “One community has been a key component in securing new businesses and generating significant growth with existing businesses,” said Peggy Byrd, former vice president of integrated marketing at Radio One.

By providing a platform where advertisers can gain audience feedback, local media outlets can help clients get more returns from their ads and measure the success of their efforts.

  1. Elevating content development.

Compelling content is still what attracts and keeps audiences today. And because consumer tastes continue to change, media companies need to make sure that they have an accurate understanding of their audience.

scripps-networks-audience-feedback-software

Ratings can provide media companies an idea of how many people are consuming their content, but they don’t reveal why viewers tune in. Why are certain shows more popular than others? What specifically do viewers like or dislike about your content? Questions like these are hard to answer by only looking at ratings.

To gain actionable insight about their content, local media companies need to engage with their audience directly. Media outlets need to know their local community better than their competitors do. To ensure success, companies should tap into audience intelligence, consider testing content before it airs and capture audience insight early and regularly.

  1. Improving marketing.

To succeed, local media outlets need to raise awareness for their brand and their programming. Media companies need a solid marketing strategy for their new programs.

Ratings, unfortunately, are backward-looking—they attempt to measure what already happened. This built-in lag means ratings are not useful when developing marketing strategies.

Ultimately, to create more effective marketing campaigns, media companies need to continuously gather rapid audience feedback on marketing ideas, test new campaigns and co-create stories with their audience. More critically, local companies need to develop a close relationship with the communities they serve—something that ratings, which treat people as mere data points, can’t help with.

Final thought

Local stations today are not just competing with other local outlets for people’s limited attention; they’re competing with cable and national networks as well as with emerging streaming businesses. They need to look beyond traditional metrics like Nielsen ratings to get actionable audience intelligence on how to improve their business. Local media companies need to infuse audience feedback frequently in all aspects of their business. By getting closer to their local community, media companies are in a better position to deliver value—both to their audiences and their advertisers.

RELATED: Download Building Audience: Courting and Keeping Customers in a Media and Entertainment Industry Awash in Data to learn more about the challenges facing the media industry. 



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