Marketers looking for new ways to measure digital media consumption

TORONTO—Marketers are struggling to track advertising reach in the brave new world of digital media, experts told a conference hosted by BBM Canada Friday. Researchers are looking for innovative ways to track digital media consumption as it becomes more important—but challenging—for companies to determine the return on investment for their new media ad spends. Measuring the bewildering array of variables was the main theme of Staying Tuned 2010, a conference BBM Canada hosted on April 23. Keynote speaker Paul Hoffert, a professor at York University and chair of the Bell Broadcast and New Media Fund, described some of the future challenges in media measurement. Hoffert pointed out that people aren’t always very good at making predictions. “When I was a kid in the ‘50s, people thought every household would have a robot maid and a flying car by 2000,” he joked. “No one seemed to think the wrist-watch that Dick Tracy talked into would catch on.” But Hoffert said he feels confident predicting that the biggest challenge for the media measurement industry will be measuring peer-to-peer (p2p) file sharing. He pointed to Harvard University research that says all legal sales of digital content obtained through iTunes, Amazon or other sources represents only five per cent of the activity on the p2p networks. Sooner or later, the media industry will find a way to track the activity, but there will continue to be measurement hurdles, he said. “What people actually consume is different from what they get via p2p.” A user who receives 100 songs through p2p sources doesn’t listen to them all for the same amount of time, he explained. People weed down the songs to find the ones they like best. About 80 are played briefly to decide if they like them. Of these, 15 songs may be played once or twice. Only five are likely to be played repeatedly. “But those 100 would be rewarded equally using current , because there’s no way to track the final five,” Hoffert said. “We need a way to track actual consumption, not just the download.” Device operating systems can track the type of information advertisers want, such as how often a file is opened, which parts are played, and for how long. Detailed maps of media consumption are theoretically possible, but the stumbling block for advertisers is consumer privacy. Hoffert said Harvard University is working on prototype software called “device-based counting,” which collects anonymous information about media consumption by removing consumers’ identifying information. P2p is a new marketing challenge, but old challenges still haven’t been resolved, Martin Black, professor of integrated marketing communications at Northwestern University in Evanston, Ill., said at the conference. “Marketers have been chasing return on investment for over 50 years, but it still hasn’t been defined,” Black said. “Chief financial officers are sceptical of the ROI claims made for marketing initiatives.” Black said he believes return on investment data is elusive because marketers measure outputs instead of inputs. “ROI is assumed to be a by-product of media distribution. But what’s really needed is proper media consumption measurement,” he said. Black said new research is examining how consumers use media in more than 31 media categories ranging from product placement to in-store advertising. Researchers measure how much time consumers spend in each category to better understand how it influences their behaviour, Black said. Black presented data showing that, in 2007, top automobile brands directed about 56 per cent of their advertising spending on television and 6.8 per cent online. But the pattern was very different when it came to the types of media consumers said influenced their buying: 23 per cent said television and 25 per cent said Internet. In other words, auto companies over-spent on television and under-spent on the Web. Black added that people often consume media simultaneously. In the United States, almost 50 per cent of consumers say they watch television while they are online. “There are opportunities for media synergy when one channel is used with another,” he said. In another conference session, Jan Kestel, founder and president of Environics Analytics, suggested a new approach for interpreting the results and return on investment of multi-channel marketing campaigns. “With digital media, we need to figure out ways to avoid the compartmentalized approach we used to take in traditional media,” said Kestle. Demographic information no longer suffices, she said. A “3D model” is needed to track the three main variables—messaging, media and lifestyles—and target consumer segments, she said. Still, a critical piece is missing, Kestel added. There’s little information about mobile media consumption habits, an important new channel. “More investment is needed to correlate IP addresses, behaviour and consumer segments,” Kestle said. news@thewirereport.ca

Marketers looking for new ways to measure digital media consumption

Broadcast | April 26, 2010

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Marketers looking for new ways to measure digital media consumption

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