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November 09, 2007

Radio Advertisers Take Note: Arbitron's New PPM Isn't Perfect

We've said it a million times... "test, test, test". When we're saying that, it's usually to set the expectation that testing is the foundation of all campaigns that achieve long term success.

Here's another way testing comes into play. Arbitron is imperfect. If your agency negotiates the media rates solely based on Arbitron numbers, you're in trouble. If you're a direct response radio agency, Arbitron numbers are only the starting point. The real basis for rates is (drumroll please) ...results.

"Arbitron's first measurements of New York City radio listening with its Portable People Meter technology delivered bad news for radio stations targeting African-American and Hispanic audiences, with ratings significantly lower than those previously generated by Arbitron's personal diary system."

This article from Media Daily News demonstrates that. Certain stations are finding much lower ratings after Arbitron's new PPM system is put in place.

"Under Arbitron's old ratings system, based on paper diaries, WBLS captured a 5.2% share of the 25-54 demographic, but tumbled by almost half under PPM, to 3% share. Previously in the number one spot, its flagship Wendy Williams Show now doesn't even appear in the top 10."

That means Arbitron is getting much different numbers with this new (supposedly better, more accurate) approach. Radio station managers looking at the disparity in the numbers and are left saying "Well, which is it?"

"The sharp changes in listening patterns among New York audiences closely resemble big shifts already seen in the two markets where PPM ratings have gone live--Philadelphia and Houston."

Radio stations are used to non-accountability. They just shoot for high Arbitron ratings and then price their airtime inventory accordingly. Direct response radio advertisers know better, and have known better for a long time.

"Arbitron appears to be missing sample target sizes by a significant margin. "The total number of 25- to-34-year-old women in their sample is 30 for the entire market, and there's just no way that can be right." "

Taking this perspective, those station managers worried about the drop in ratings with Arbitron's PPM would be less worried. "Test with us" and you'll see our real value. That would be a direct demonstration of the value of advertising on their station, regardless of the existence (or not) of flaws with Arbitron's PPM.

Posted by Jeff Small at 08:04 AM | Permalink