Old business model bundling bundling your favorite shows w some ads the bundling makes the money Content produced by media company to attract large heterogeneous audience Advertisers pay media companies to reach large audiences as they consume content Audiences buy the bundle the content they really wanted bundled together with ads and content they don t want The internet has severely disrupted this model A lot of revenue comes from advertising Average consumer sees 3000 ads a day 5000 in city Take TV Average 30 minute TV show has 8 minutes of ads Cost of that ad time is based on size of audience composition of audience demographics Super Bowl 2015 30 seconds 4 5 million Thursday Night football take a look Scandal 217 546 Big Bang Theory 344 827 Ratings shares Ratings of households watching your show of households with TV 1 rating point for US equals a little over 1 1 million homes Ratings 100 000 watching Top Gear 400 000 households have TV 25 rating 25 25 Ratings shares Ratings of households watching your show of households with TV Ratings are compiled in individual TV markets TV market geographic footprint of signal coverage DMA Designated market area 210 DMAs for TV map 1 New York 7 5 M TV HH 84 Syracuse 386K TV HH 210 Glendive MT 4K TV HH Ratings shares Share of households watching your show of households with TVs turned on Ratings shares Ratings 100 000 watching Top Gear 400 000 households have TV 25 rating 25 25 Share 100 000 300 000 have TVs on 33 share Ratings leaders All time M A S H final episode 60 rating 77 share Current Nielsen ratings data Ratings shares Ad rates are set based on ratings shares for audiences of various demographics during sweeps periods Sweeps February May July November designed to especially attract audiences sweeps months nielson goes to every tv marker 4 times a year goes to each and everyone from those marketed area use those to set their ad rates for the next three months trying to get as many viewers as possible when neilson collecting data How do we know who s watching A C Nielsen company The Nielsen TV Viewing Diary The Nielsen Company ask if people are willing to be a nielsen family or not try to get as representative statistics as possible good data form a small sample give you an incentive to record your viewing for a week comcast their box will automatically collect what shows your tv is tuned to upload that data every day Paper diaries used in all 210 DMAs still do use paper diaries for a week record what tv shows you watched monitors what you re watching when in same room says hes in the room while watching records what you watch personal people meters Data in top 21 markets collected with personal people meters Data in top 56 markets use set top meters charge all of the advertising firms to know the data Ratings data helps position channels and shows Position which demographic groups content appeals to knowing who your key audience is ex Cable Television Advertising Bureau gives networks important information by this data to tell them why they should by certain programs over others how these stations use this data to say this is why you want to advertise to them Problem with ratings Technology has outpaced system DVR commercials 3 within 3 days of when something aired iPhones Hulu ad bundled into the content that you want to see neilson now collects this into their data lots of people who were not counted in those ratings ex Auro illegal to take broadcast signals and selling it to them as a packages without paying the channels to do that stream broadcast tv wherever you are loophole illegal signals are their copyrighted material you can use tech to record what we can get Media audience wildly fragmented across choices people can be inaccurate our viewing spreads through so many different channels social TV watching other things media while watching a show Exposure attention behavior just bc you see an ad doesn t mean anything doesn t mean you automatically pay attention to them Therefore advertisers seeking greater ROI Return on Investment Old business model for media cannot keep up just bundle content w inf o u like advertisers will think they will get a return on investment have their ad campaign help make money for them sell the same number of units at a higher cost use old fashion media legacy media newspapers magazines Advertisers finding new ways to reach audiences Product placement Under the radar marketing Branded entertainment Web marketing Internet offers better fit between placement of content and audience receptive to message google pioneer in capitalizing on moment or relevance get ads in front of people when they want something interest based advertising generate ads based on what content people view online google adwords and adsense very lucrative adwords links to apriticluar palces helps connect advertisiew w pple who are lookign for things adsense will pay a certian amount of money for every tiem someone clicks on them pple bid to be seen only pay when someone clicks on that track content across all of their apps gmail more cost effective for advertisers place ads based on the continent pple view Old business model for media cannot keep up Advertisers Content produced by large media company Or Small co or individuals prosumers YouTube It is distributed by few large media companies Or the internet or mobile Audiences wildly fragmented into small niches who want only unbundled specialized content especially if free