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Nielsen's New Ad Service: Will Networks Get More Money?

Wednesday, 3 Dec 2008 | 9:33 AM ET
CNBC.com

More data equals more money. It's a pretty failsafe rule in the word of marketing. The more information you give advertisers on exactly who is really watching your ad, the more you can charge for the ad time. But marketers haven't been able to make use of the second-by-second data on exactly who's watching what until now.

Nielsen is launching a new service that uses data from cable set-top boxes in a deal with the National Geographic Channel. Nielsen is accessing information from 330,000 homes in the Los Angeles area through a deal made with cable company Charter Communications this past spring.

With this data National Geographic is tweaking its use of commercials: where it places them, and how it uses re-caps to keep viewers tuned in. So far its working. Viewership of its commercials, including those seen up to three days after a show airs, was up to 96 percent of the show's total viewership in the third quarter, from 83 percent in the second quarter. IF a network can tell advertisers exactly how many people are watching their messages, they can surely charge more and attract more marketers.

Nielsen may have dominated television ratings with its people meter, but the landscape has gotten a lot more crowded in the past decade with TNS Media Intelligence and TiVo also offering TV viewership metrics, including sophisticated second-by-second breakdowns of how people watch commercials. Nielsen no longer dominates the space, because all these other players see the money in this information.

Advertisers want to understand how people watch during commercial breaks to inform their purchasing. As anyone with a DVR device can guess, the first and last commercials are viewed more than those in the middle. More surprising, what one might call serious watchers-- people tuning in for sporting events are documentaries-- have a tendency to channel surf during commercial breaks. Meanwhile those watching cartoons or primetime dramas will surf. When the programmers start really using all this data about how people watch and skip, it'll be interesting to see how the numbers shift.

    • Nielsen offers second-by-second viewership data

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.