Monday, November 26, 2007

Ad Age looks at metrics for the Out-Of-Home video industry

Ad Age has put together a nice article on the attempt to come up with metrics for the out-of-home video industry. One sentence in particular sums the whole situation up nicely as far as I'm concerned: "Double-digit growth means it's time for organized metrics -- no easy feat for a market that includes everything from elevators to urinals." In short, everything always comes back to the fact that potential is there, but the concrete definitions are not.

It's important for everyone in this industry to scrutinize measurement techniques developed by companies that have a financial stake in the results. While organizations such as Ideacast and SeeSaw Networks are pushing things along by advancing research into metrics, whatever results they reach can never be seen as completely unbiased and can be therefore be attacked by rival advertising venues. The best way to solve the metrics issue is for an independent and well trusted research group to come along and take control.

Also at issue right now is that most sponsored studies tend to come off too optimistically, and can stir up some doubts for outsiders (think about the OTX study released in October). An independent group would be more able to head off some of those concerns, as would some additional research conducted by more 'traditional' media companies. People that are involved in an industry, no matter what it is, are going to inevitably carry with them certain biases, so it often takes outsiders to paint a more realistic picture. Just as it can be jolting for researchers to under-estimate a market's potential, it's also important for them to not over-estimate the market, or else there will be lots of problems when we don't live up to the expectation.

So I guess I'll throw a question out to our readers...How long (years, months, etc.) before we'll be able to better measure the reach of out-of-home advertising?

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Bill Gerba said...

The real question is how many different metrics and measurement systems will be created, and will there ever be a standard?

I could see the gaze tracking stuff taking off for networks that sell space based on a CPM, since that's the best measure of how many people are looking at, near or around the screens. But a DS-IQ like system that links playbacks to register receipts ought to rule the roost for retailers that don't care about eyeballs, only sales.

Jeff Dickey said...

Hello. I recently posted a response to a similar subject in a post by Phil on behalf of SeeSaw and wanted to offer some additional perspectives here. There is absolutely no doubt that "independent" research will be perceived by the advertising community as more credible, but let's also take a look at a few other things:

In addition to the OTX Digital Out-of-Home Media Attitude and Awareness Study, SeeSaw has run other studies through OTX and has found out a lot of interesting things. What was most interesting to us was that, in fact, our research strongly correlated to independent studies done for various networks by Nielsen, Arbitron and Scarborough. We now have four different research companies doing multiple studies reaching very similar conclusions - all done at different times, in different places using different methodologies. If it looks like a duck, quacks like a duck and waddles like a duck, it's probably a duck.  And, if four different research companies using different methodologies at different times and different places all end up in pretty much the same place, one can take the leap that there must be a fairly high level of validity to the numbers.

The Internet model has utilized a methodology that is annually blessed by Price Waterhouse - for the past ten years.  Any web network can conduct research which is deemed to be valid as long as they strictly follow the industry accepted methodology by which this research is conducted.  This may well be the answer to this issue - just get everyone using the same methodolgy and have PW or whomever bless it annually.

The Internet was doing over a billion dollars (that's 1998 dollars) in advertising revenue before the IAB had a commonly accepted set of standards. The IAB institutionalized the methodology for measurement and gave the industry another boost, much like OVAB and its members, including SeeSaw, are seeking to facilitate a similar standardization.  But, the bottom line here is that there is currently lots of data that makes a compelling case for the digital signage media and the current lack of "independent" research will certainly hamper the growth of the industry, but not stop it.

This train is leaving the station.