Nielsen ratings have been the gold standard for understanding consumer media behavior for decades. But since then, we have seen the rise of new forms of media like TikTok and streaming that have taken consumers by storm, capturing their attention and dollars. So as new media and technology emerge and affect consumers’ viewing habits, we must ask the question of whether this industry-standard measurement system still holds up? And if not, what will the industry implement as its replacement? In this article, we will dive into the history of Nielsen’s rating system, the changes in media threatening its relevancy, and the future of media ratings.
History of Nielsen Ratings
To understand the dominance Nielsen ratings have had on the US advertising industry, we must look back to its rise in television. As television found its way into US households in the 1950s, Nielsen launched their TV audience measurement system garnering insights into what audiences were paying attention to. Later in 1965, the Nielsen Station Index Service released the “Viewers in Profile” report that became the standard reference for stations selling TV spots to advertisers. From resources like this to the invention of their Storage Instantaneous Audimeter, a device that stored TV set usage data and transmitted it to Nielsen overnight, they became the information hub on consumer media reception. Up until today, Nielsen has used their proprietary data to establish itself as an essential service provider guiding TV networks and advertisers alike.
Changes in Consumer Choices
So how can a Goliath such as Nielsen become outdated? With a business founded on the insights of the consumer, it is key that they are able to track audiences wherever they are. But consumers’ attention is not simply split between radio and television like before. Today, audiences are constantly bombarded with content and ads from their phones and laptops to cable and smart TVs. Additionally, tracking audience insights has become drastically more segmented across television, streaming, digital, and radio.
According to Lara O’Reilly’s Insider article, Why the latest in a long line of Nielsen vs. networks fights could be different this time, she notes that both television executives and ad buyers are unsatisfied with Nielsen’s measurements. Additionally, many are awaiting a trustworthy and accurate cross-platform rating system Nielsen is developing and believes will be ready fall of 2024. With dissatisfied networks and evolving technology, many are looking to alternatives that can track today’s audience insights.
New Rating Options
So where exactly is this new Nielsen replacement? While there has not been a definitive alternative ready to launch, some major media players are putting their hats in the ring. According to Brian Steinberg’s Variety article, With Nielsen Under Scrutiny, NBCU Wants to Build New Measurement System, NBCUniversal is “assembling a full suite of interoperable measurement solutions that are as advanced, diverse, easy-to-use, and multi-platform as the ways people watch content.” Their goal is to “build a new measurement ecosystem for us that reflects the future.” Though this technology is still in its infancy, if effective, it would drastically shake up the advertising industry since many advertisers have established their rates according to Nielsen’s ratings.
Though it appears like we are in the paradigm shift between the past and the future of consumer media ratings, it is our responsibility to stay vigilant on the shifts that alter the media and advertising industries. Whoever can capture and translate cross-platform media insights can become the new king and possibly dethrone Nielsen ratings. Until then, we remain alert and wait.
That is why our teams at River Direct build and strategize with the big picture in mind. From traditional radio and television services to emerging media options on CTV and digital, we provide our clients omnichannel solutions to reach consumers wherever they are. Want to learn more about our agency and services? Be sure to follow us across our socials (Facebook, LinkedIn, and Instagram). Lastly, for more content on the latest shifts, trends, and news in advertising and marketing, subscribe to our newsletter below!