Monthly Archives: May 2011

Isn’t it time to re-look how TRPs are measured?

This post is dedicated to John Wanamaker, credited for setting advertising standards and considered by few as father of advertising. John Wanamaker died in 1922. Had John lived today – he would have some interesting quotes to share on RoI in digital advertising.

This post is inspired by one of his very famous quotes – “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

The term RoI became a buzz word ever since Digital advertising started to gain prominence in last few years. Talk to any brand manager today on digital spends through any channel – Search, Social, Display or Email – his quick conclusion on effectiveness of any campaign will be based on ROI.

Pitch any campaign today on Digital – both Brand Manager and the Digital Marketer sound no less than a Investment Banker trying to advice its client on a multi-million dollar deal discussing on its investment, profitability and more. The same Brand Manager or Media Buyer will simply look at TRPs of any channel/program and allocate about 50% of its media spends to Television, distribute a significant chunk between Outdoors, Newspapers, Radio and leave a minuscule 5%-10% to Digital.

Well, this post is not about how Digital Medium today is perceived as ROI driven, this is very unlikely to change in coming years. The question to raise is – isn’t it time to re-look how TRP ratings are measured rather than blindly accepting the reports as provided.

First – to know more about what is TRP and how they are measured using people meters – read this excellent post on Television Point.

For those who have not seen a People Meter – here is one below:

credit: image source

Here are some questions usually asked about the authenticity of TRP ratings –

  • In India – TRP People Meters are installed only in 16 cities across 9 states; Less than 10,000 people meters are installed  –  would they be good enough to reflect insights on Television Viewership of a country as large and diverse in demographics & culture as India?
  • There is little or no transparency on number of households with People Meters installed, techniques of data collection & interpretation, and how the data is extrapolated to whole population. Are there any validations if the meters were correctly operated and data collected the way it should have been?
  • People Meters were always perceived as expensive devices since invention; with advancements in technology – why have the People Meters not proliferated to a wider reach.
  • Is there any control by Government authorities on collection of this data and authenticity of same.
  • How will any marketer, advertiser or broadcaster challenge authenticity of the weekly TRP ratings released.

And in world of digital economy, let me add few more questions to above arguments –

  • Now people are socially connected through social networks, it is very difficult to spot people who mention they have subscribed to People Meters.
  • On Google’s image global index – there are not many images when you search for “people meter”.

In todays world anything that happens in offline world leaves a footprint online. Absence of digital footprint for “people meter” wants me to question the proliferation of such devices in real world.

The DTH Effect –

Direct-to-Home (DTH) or Satellite Televisions are today immensely popular amongst masses. In India – its reach is 20 Million households in 2010; and India is expected be the world leader in DTH subscriptions. 20 Million would be a better representation of viewership data – compared to the dismal < 10,000 people meters installed by TAM in India.

aMap works with DTH service providers – but it is unlikely to capture data across all subscribers and might be following the people meter approach. Brand Managers are believed to be more inclined towards TRP ratings provided by TAM for decision making while aMap ratings are for reference.

Its most unfortunate if DTH platforms are unable to track viewership data. Thats like Air Traffic Controllers saying – there are 500 planes in skies today – we are unaware of their origins & destinations, can confirm with pilots only when they land.

TRP Measurement – Its time to Change!

Fundamentally – People Meter approach will always be poor representation of the population. As spends on digital media start increasing and reaches a critical mass, sooner or later TRP measurement will be questioned by same decision makers who accept it blindly today.

Fortunately or Unfortunately, the future of TRP & GRP measurement is digital. Existing global players like Nielson, TNS, & others involved need to look beyond people meters and embrace the medium.

Here is overview of how possibly TRPs will be measured in digital world –

  1. Develop applications across digital channels – Internet, Mobile (Java, iOS, Blackberry, Android, Symbian and others)
  2. For every location (geo by country / location) – populate information stream of programs currently broadcasted at that time.
  3. Allow users to select the programs they viewed and report the same back to the measuring system through the applications.
  4. User demographics will known at time of App-Registration.

There are ways to authenticate user viewership patterns. Instead of focusing on data collection through people meters, with same efforts & resources – it will be possible to crowdsource viewer-ship data for programs and channels across millions of users – all in real time.

Future Prediction – by the year 2022 (exactly 100 years after John Wanamaker died) – people meters and traditional TRP measuring practices will be obsolete. They will be measured through digital medium! John Wanamaker would have proudly said – “Thanks to Digital, I know exactly which half of my advertising money is wasted!”

Absolute Selfish self-promotion –

I future-gaze based on trends in consumer internet, user acceptance of technology innovations and its impact on lives of people.

My thoughts on Future of Television have been well received and acclaimed by a few users who took notice. Beyond which I have no expertise/experience in Television Domain.

Search to Display ReMarketing – To lower Cost of new Customer Acquisition

All eCommerce sales can be attributed to two types – Impulse and Intent driven.
  • Impulse buying is more of direct marketing – combination of offers and deals driven by on-site marketing or direct marketing to existing consumers.
  • Intent buying covers full AIDA cycle – Attention, Interest, Desire and Action; and can be categorized as a conscious purchase decision that spans over a period of time.
Usually Search Marketing Conversion Rate > Display Marketing Conversion Rate
Why so:
– Search Traffic comes with user-intent, user searching for product
– Display Traffic – click enticed more towards impulse decision, less towards intent
Usual Difference:
– Display Marketing Conversion Rate is 4X-6X of Search Marketing
Conversion by clicks:
– Average eCommerce service requires 100 visitors to convert into a customer (successful transaction)
– Search typically takes 50-65 visitors for one successful transaction
– Display will require about 250-390 visitors for one successful transaction
CTRs by Marketing Channels:
– Search Marketing – 1% to 2%
– Display Marketing – 0.1% to 0.2%
Costs per Transaction of Marketing Channels:
– Search Marketing: 10-15 INR per click = 500 INR to 975 INR
– Display Marketing: 4-8 INR per click = 1000 INR to 3120 INR
Now, introduction to Search ReMarketing: – Reaching out to highly-intent driven users who visited the eCommerce store via Search, but did not complete transaction.

Scenario 2: Search to Display ReMarketing

Increase Search Marketing spends to expand to more high quality traffic by increasing span of keywords or by bidding higher on converting keywords.
Search Marketing: 12 INR to 20 INR = 600 INR to 1300 INR
Direct Display Marketing: 0 spends
Display Re-Marketing: 10 – 15 INR per click
Acquiring New Customers:
– Search Marketing = 600 INR to 1300 INR
– Out of 50 to 65 visitors – 1 successful transaction; 49 – 64 users drop-out.
Display ReMarketing to the dropped-out users;
– 49 – 64 Clicks: 490 INR to 960 INR
– 2-3 usual conversions
Total Conversion 3-4
Total Cost: 1090 INR to 2260 INR
Average Cost of Acquisition: 360 INR to 572 INR
Closing Remarks:
  • Do not treat Search and Display as separate channels to acquire customers
  • Search remarketing through Display will reduce your cost of acquisitions by 25% to 65%
  • Always look for cross-channel marketing opportunities to enhance RoI on Online Marketing