Radio_wars_tony

Who sits here?

Our RADIO WARS coverage exists because of ratings. Don’t let anyone fool you: when there are two major players, in a major market, competing for a major demographic – WIP and 97.5, Philadelphia, sports fans (men 25-54) – being the top-rated station is über important. Sure, there’s enough audience to go around for both, and maybe even a third station (oh God please no), but being the perceived top dog (in any media battle) comes with all sorts of perks, such as getting better interviews and access, which of course leads to bigger advertisers and more lucrative sponsorships.

As you know if you read this site with any frequency, and as we discussed at length with Tony Bruno late last year, ratings are based on data collected by Portable People Meters, or PPMs. Instead of having panelists record their listening habits on a card (which is what used to happen), PPMs given to a small – very small – set of paid participants listen for signals encoded in the audio playing through radio speakers. The signals are imperceptible to listeners, but the PPMs hear them (ostensibly– more on that in a second). The data from that small group of people – again, really small – is used by Nielson to determine the ratings.

Now, there are two obvious potential problems with this system:

1) While small sample sizes are usually more than adequate to extrapolate data from, there’s always a margin of error, especially for something like estimating radio audiences, where there are so many varied options listened to by such a wide range of people. But let’s assume Nielson accounts for this and doles out PPMs to a diverse and almost random group. Even so, when station X or bloviating host Y declares that it or they have Z rating and G listeners, it’s all an estimate based on the small group of people with PPMs. This, to me, is one of the reasons why advertisers on radio, or TV, or even in the newspapers (which uses different but also fuzzy math to estimate daily readership), often pay a phony premium based on trumped-up numbers– because there’s no way to give advertisers an actual, measurable audience size. It’s also why advertising on the Internet, or a podcast, or even YouTube, is much more efficient– advertisers can see almost exactly how many views, clicks or conversions they get based on their ad spend. There’s more fragmentation online, but advertisers can drill down to a super granular, and almost exact, level, which they simply can’t do with older mediums.

2) But there’s perhaps an even bigger issue with the system: PPMs might not even work all that well. There have been stories about people placing their PPM on a ceiling fan (to keep them active with motion) while they go out and leave their radio on all day. The incentive? Panelists get paid for participating. And lately, attention is being given to the notion that the meters themselves might not always hear what they’re supposed to hear.




Last month, a FiveThirtyEight piece detailed the curious issue smooth jazz stations faced when the switch to PPMs occurred, about 10 years ago. As it turns out, the sounds encoded in audio for the PPMs to detect were in a frequency range that couldn’t be hidden as well in softer tones, like jazz. As a result, as the theory goes, smooth jazz ratings went down and broadcasters started switching away from the format.

The makers of a device called the Voltair (awesome name) purport that their product can help stations better encode their audio so it can be better picked up by PPMs. Nielson doesn’t like that and recently held a meeting with radio execs to basically trash the Voltair … because the claims, if true, would call into question the accuracy of the ratings (surprise!). FiveThirtyEight reports:

Nielsen tested lots of types of radio (including music and talk) to see whether the Voltair system made them more likely to be detected by Nielsen’s Portable People Meters (PPMs). Voltair made it more likely for one particular type of radio Nielsen tested to be counted: talk radio played at a hushed volume — roughly one-fourth the volume of an ordinary conversation — with background noise of about the same volume. That doesn’t necessarily mean PPMs aren’t doing their job, Nielsen said. Those conditions might make talk radio inaudible for many listeners, in which case it shouldn’t always be counted.

Nielsen executives said in the presentation that the company’s current technology registered almost every test case for all other scenarios tested. Nielsen’s tests covered a range of music (including smooth jazz, one type thought to be at a disadvantage under its system) and talk, and different volumes of sound and background noise.

That leads to a whole different conundrum: what constitutes a listener? If someone has their radio on really low in the car while they talk to a friend or coworker over a 30-minute ride, are they really listening to the radio? No, they’re not. All that really matters – from a business standpoint – is whether they’re hearing and ingesting the content of the advertisements, and in that (common) scenario, they’re not. And the Voltair, though it may fix the alleged smooth jazz problem, could inflate ratings for talk radio. Advertisers could be charged for listeners who aren’t really listening. Again, I know I sound like a broken record (mp3?), but this is why, say, podcast advertising is taking off– listeners are typically actively choosing to listen to a given show, with the ability to pause when they’re distracted. While not perfect, you can measure the audience almost 1-to-1, and eventually there will be tools to do so in an even more precise way.

So let’s take this brief summer ceasefire in the RADIO WARS to remember that all fighting and bloodshed takes place on hills that might not even exist– all the participants just choose to agree that they do. It’s sort of like a virtual reality battle for supremacy, where the victors “win,” but do they really… or is that just what the algorithm spit back at them? NEEDS A SCORE: