The Media Rating Council (MRC), a widely trusted industry group that sets standards and metrics for television, video and other media has officially suspended its accreditation of Nielsen, following accusations that the organization systematically failed to report accurate viewership numbers during the Covid-19 crisis. Nielsen has until now been widely considered the authority on television and premium video ratings and ad measurement. The suspension of MRC accreditation puts that expertise into question. Here’s what you need to know.
● The MRC today announced that its board of directors has voted to suspend accreditation of Nielsen’s National Television service as well as its Local People Meter and Set Meter Markets services, both of which fall under the umbrella of Nielsen’s Local Market services. These suspensions will go into effect mid-September.
● Nielsen’s Local Market services had already been on hiatus since January of this year. On August 17, Nielsen announced that it planned to add Broadband-Only (BBO) homes to its panels — groups of consumers whose behaviors Nielsen uses to approximate larger patterns — in October of this year. However, the MRC today said it does not have faith that adding BBO viewing will remedy existing issues with the Local Market service. In a statement, the MRC said, “Based on continuing issues with the Local Market services, some of which parallel those of the National Television service, as well as the Board’s assessment of Nielsen’s ability to appropriately integrate BBO viewing at a local market level at this time, the Board additionally suspended the accreditation for the Local Markets as well.”
● Nielsen's chief executive David Kenny put out a letter today in response to the news, promising to "remediate issues raised by the MRC" and "continue to provide the most representative, reliable and robust audience measurement available."
● The MRC warned Nielsen earlier this month about the possibility of accreditation suspension following accusations by TV and premium video interest group the Video Advertising Bureau (VAB) filed earlier this summer that the research firm had violated five MRC minimum standards. The VAB supplied evidence indicating that Nielsen had faced Covid-related operational problems that ultimately led to ongoing underreporting of viewership data. As a result, countless advertising dollars were likely lost and ad metrics misrepresented.
● Under pressure, Nielsen independently requested an MRC accreditation hiatus on August 12. At the time, the VAB’s chief executive Sean Cunningham said in a statement, “Nielsen has essentially announced, ‘You can’t fire me, I quit,’ just hours before the MRC suspension vote process is activated.”
● In a statement issued today, George W. Ivie, executive director and CEO of the MRC, said, “While we are disappointed that the situation has come to this, we believe these are the proper actions for the MRC to take at this time. MRC’s Board of Directors, which represents an extremely broad range of industry constituencies, and includes advertisers, agencies, and media companies of all types, is strongly unified in its positions on these matters. MRC stands committed in our willingness to work with Nielsen toward the goal of being able to restore accreditation to these important services at the earliest possible time, and it is our hope that Nielsen likewise will continue to engage with MRC and its clients in pursuit of that goal.”
● In an email to The Drum, a Nielsen spokesperson said, "The Media Rating Council responded to Nielsen’s request for a hiatus in accreditation with a vote to suspend our National TV Ratings service, as well as our Local TV Ratings service. While we are disappointed with this outcome, the suspension will not impact the usability of our data. Nielsen remains the currency of choice for media companies, advertisers and agencies. We are committed to the audit process and during this pause in accreditation we will work with the MRC on resolving this suspension. We will also take the opportunity to focus on innovating our core products and continue to deliver data that clients can rely on, ultimately creating a better media future for the entire industry."
● Nielsen is currently developing its Nielsen One product, which aims to resolve some cross-channel measurment problems. Kimberly Gilberti, the senior vice-president of product management at Nielsen, told The Drum in May that the goal of Nielsen One is to ensure “computation is being done in a way that is truly comparable” across channels. “
● The VAB’s Cunningham, in a statement sent to The Drum, said, “The united buy/sell marketplace decision to suspend Nielsen’s national and local market accreditation must be seen by Nielsen as a loud change-or-die challenge. In fact, all measurement and currency providers with big future aspirations in the video advertising sector must take the 2021 mandate for real transparency, full and deep audience capture, urgent innovation and rigorous verification as mission-critical for them all. Advertisers should expect to see more innovation in the next three years in video measurement and currency than what was achieved in the last 30 years, time has officially expired on friction and frustration.”
Why it matters
● The controversy surrounding Nielsen’s MRC accreditation this summer has led to broader debates concerning the precision, accuracy and reliability of traditional TV and video measurement frameworks, which many experts argue are not well-adapted to the increasingly complex landscape of connected television (CTV) and over-the-top media (OTT).
● Amid the drama, NBCUniversal issued an RFP in August to more than 50 measurement organizations — including Nielsen — calling for more innovative and effective TV and video measurement solutions.
● Meanwhile, measurement firm Comscore sought to accelerate its own MRC accreditation, hoping to establish itself as a trusted industry voice as Nielsen loses credibility.
● The VAB’s Cunningham and others propose that perhaps Nielsen’s traditional panel-based approach to measurement is ineffective at capturing the whole picture of TV and video viewership and user trends. Instead, Cunningham believes that what’s needed is a framework that combines a panel-based approach with more granular census-based reporting. Census-based reporting uses data from a larger share of the user population to paint a more accurate picture of large-scale behavior. He previously told The Drum, “What marketers want is the assurance that they are getting to the right customers and that their customers can be rightly counted in every conduit, every interface and every video screen – and that they can calculate on that knowledge and use that to increase sales….marketers want to think about it as sales currency. And the data has got to be that good. It’s got to be that accurate. And it’s got to do the job of not just counting, but truly understanding on a device-by-device and audience-by-audience basis.”
● Nielsen’s MRC suspension is likely to increase pressure across the TV and premium video industry to develop more advanced measurement systems. However, before more reliable, accurate and precise methods are universally agreed upon, the decision could create significant turmoil, as advertisers demanding ad performance insights will be at somewhat of a loss.