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: Continue reading