As a leading media audit firm and a neutral expert on the paid media supply chain, MMi has received numerous inquiries over the past year from our advertiser clients and their agencies about the Local TV and Radio marketplace evolution to impressions-based transactions. In this post, we provide an overview of exactly what we’re telling them.


What Is This About?

Impressions-based buying is a movement by the Local broadcast media supply chain to transact on impressions and costs-per-thousand (CPMs) instead of the traditional target rating points (TRPs)and cost-per-points (CPPs) which have long been the basis of local broadcast media.  The two are of course simply different mathematical calculations of the same audience (with ratings representing a gross percentage expression and impressions representing an estimated raw count).  The basis for both is typically the exact same data set of Nielsen audience estimates.

The TVB, the trade association for local broadcast television stations, has been leading this charge – backed by some of the largest station ownership groups in the U.S. – communicating to the trade press, agencies, and advertisers that impressions will be the basis of transactions in 2020.


What Do We Know?

Audiences have always been measured on impressions, and this evolution will not be a fundamental change.  They were simply traditionally transacted on ratings in local media. Industry software is already equipped to manage impressions, including agencies’ Strata and MediaOcean platforms, and SQAD cost database (CPMs).

Stations will get the “benefit” of all measured impression estimates versus rounding to tenths,hundredths or thousandths of rating points. Variation in delivery results should be negligible for a typical media buy.  Performance may improve for the lowest-rated or most fragmented audiences (captured viewing versus rounding to zero in percentage, or TRP, terms).

It is important to note here that Nielsen measurement precision will not change, so the results will not be more precise.  This is just math.  Agencies and sellers that have long criticized Nielsen’s so-called lack of precision are essentially now doubling down on it. To be fair, Nielsen has made enhancements to its local measurement in recent years, so its measurement in general may more closely represent true audiences.  This would be true regardless of whether you look at ratings or impressions – because they come from the same data set.

Importantly,advertisers and agencies will be able to more easily compare across markets as well as different media channels, including National and Digital, where impressions and CPMs are already more prevalent audience and cost metrics.

The entire Local ecosystem will be better poised to participate in programmatic and audience-based (advanced targeting) buying marketplaces.


MMi’s Perspective & Key Considerations

Local media plans will likely continue to be expressed based on TRPs as representative of communications impact in each market, ties to reach and frequency metrics, etc.  At minimum there will be a transition period, and some “local only”, dealer or franchise organization advertisers may also express media weight in TRPs in addition to impressions.  (Note that currently National TV is Planned based on TRPs, yet deals are transacted on impressions.)

Population numbers will need to be agreed upon and documented between buyers and sellers,assuming conversions to TRPs will be needed to assess media plan fulfillment.  For example, is it the DMA/Metro universe published at the time of negotiation?  At the time the schedule airs?  

Level of impressions aggregation will need to be agreed upon and documented between buyers and sellers.  Are guarantees per station per quarter, per today’s TRP-based best practices?  Or is there a more (or different) level of granularity in an impressions-based paradigm? Per daypart or package (as in National or Digital)?  Per market, Per region, or National equivalent (for a programmatic approach)? At a minimum, we advise advertisers to expect the same level of accountability as they currently receive, if not more (with the “more” being based on perceived improvements in measurement stability).

Units for reporting and transaction – TRPs or Impressions - must be agreed upon in advance and consistently executed.  In other words, avoid the risk and drain on resources a hybrid or station-by-station approach would create. Any Spill analysis is much simplified with an impressions approach (mostly a Radio consideration, but also for special trade areas and “hyphenated” markets).


What Do Advertisers and Agencies Need to Do?

  • Advertisers and agencies should discuss together the needs of the organization and go to market accordingly, rather than accepting seller mandates.
  • It is crucial for the Advertiser, agency and seller to agree on levels of guarantees,reporting expectations and methodology for any required conversion math.  

In a nutshell, yes, it’s just math.  The industry dialogue is a great evolution to holistic Media Planning and Buying, meeting your customers the same way they consume content in the course of their days. MMi’s Circle Audit® has housed impressions for Local media behind the scenes since 2004, and is prepared to evolve with the marketplace as long as all the requisite populations and guarantee paradigms are documented.

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