Why Audience Measurement is Important

Audience measurement was born out of the radio broadcasters’ desire to show the brand owners that they have a good number of target consumers of the brands.Over time, audience measurement has become the currency for the buying and selling of the ad space in the media. Audience measurement is important for the planning and evaluation of the media programmes as well as ad campaigns.

Audience Measurement Today

Have you ever wondered why your favourite TV show was cancelled? Have you ever wondered why a specific movie does not have a sequel? As your intuition might tell you: because they do not perform well enough to attract a decent audience or traffic. You are right! And you just touched upon one of the most important reasons for audience measurement: performance metrics.

However, audience measurement is not just useful for deciding the fate of content programming based on its performance with an audience. Instead, it is important at the planning, transaction, and evaluation stages for both media owners and advertisers. To understand the role audience measurement plays at each stage of media planning and media channel optimization, let’s first learn about the birth of audience measurement.

History of Audience Measurement

In the 1930s, radio broadcasting was still a novel invention. People from the radio station were scratching their heads about how to secure sustainable revenue streams to keep their outfits running. Meanwhile, brands were always eager to use every means of communication to advertise their products/services to the customers. Realizing the value of advertising for brands, radio broadcasters came up with an idea: why not sell ad space in their programmes to brand owners so that their brand gets the audience attention while earning revenues for running their radio stations?

Radio broadcasters then approached the brands with the idea and quickly faced a real-life problem. Given the radio broadcasting was still a new concept, brand owners questioned radio broadcasters about how many audiences the radio station have and who the audiences are (income, demographics etc.).To prove to the brand owners that the radio station had a big pool of audiences and these audiences were the target consumers for the brands, radio broadcasters started to commission market research companies to measure its audience. So, proving the existence of the certain audience and its size was the reason behind the birth of audience measurement [1].

Evolution of Audience Measurement

As time passed, radio saw an increasing adoption among the public, so the purpose of audience measurement was no longer limited to proving the existence of its audience or listenership. In fact, brand owners and radio broadcasters started using audience measurement metrics to negotiate the price of ad space in broadcasters’ programmes. Simply put, the audience measurement has become, and is still, the currency for buying and selling of ad space in air time [2].

The significance of audience measurement does not stop here. Throughout time, it starts to play a role at the planning stage of both programmes and ads. For the media owners, knowing who the main audience are and what they like, broadcasters can then use such information to produce or commission programmes that appeal to their audience segments [3]. For the brand owners, knowing the composition of the audiences of the station/channel, can enable more informed decisions about the station/channel and the time slot to place their ads so that they can maximize the reach of its ad message [4],

Also, as you might have already realized at the beginning of this blog post, audience measurement helps broadcasters evaluate the performance of their programmes and decide whether to drop or continue a particular programme [5]. From the brand owners’ side, audience measurement is also important as it helps them to evaluate the performance of their ads (e.g., the number of people saw the ad / impressions, frequencies, and reach) [5].

From the perspective of the ordinary audience, audience measurement determines the survival (shelf-life or longevity or continuity) of their favourite programmes. However, audience measurement is about more than just informing strong programming needs. It is the currency used in ad space trading. It serves as the foundation for the planning of any programme and ad campaign. It is also an important measure for the return on investment of a a broadcaster’s programmes and advertisements.

References:

[1] Webster, J. (2012). ‘Developments in audience measurement and research’, in Calder, B.J. (ed.) Kellogg on Advertising & Media. Hoboken, New Jersey: John Wiley & Son, pp.123-138.

[2] Balnaves, M., O’Regan, T. and Goldsmith, B. (2011). Rating the audience: the business of media. London: Bloomsbury.

[3] Mytton, G., Diem, P. and Dam, P.H. van. (2016). Media audience research: a guide for professionals. Third edition. Thousand Oaks, California: SAGE Publications.

[4] Napoli, P.M. (2011) ‘Ratings and audience measurement’, in Nightingale, V. (ed.) The handbook of media audiences. Chichester: Wiley-Blackwell, pp.286-301.

[5] Webster, J.G. et al. (1991). Ratings analysis: theory and practice. Second edition. Mahwah, New Jersey: Lawrence Erlbaum Associates, Inc., Publishers.