Today, by last count, there are over 50 national TV networks (broadcast and cable), running over 300 stations, all driven by advertisers willing to pay for access to their potential customers. In 2017, TV advertising spend is projected to reach over $72 billion with annual digital ad spend projected to reach a total of $77 billion. Ratings are the currency of the market and for over 60 years, the Nielsen Company has been the arbitrator of the critical advertising rates that broadcasters from across the globe charge advertisers.
Over these last 60 years, despite very little innovation on their part, and much to the chagrin of their customers, Nielsen has been able to fend off over 14 legitimate challengers to their near total market dominance, leaving them as the uncontested ruler of the TV ratings game. In 2016, Nielsen reported over $6 billion in revenue and has a market cap of just under $20 billion. Given such a large potential market and a dominant player that is resting on its laurels with a prehistoric technology, the market is prime for disruption.
Enter TVision Insights, the Boston-based company headed by CEO Yan Liu, that is revolutionizing the TV ratings game. Unlike the 14 other competitors that tried and failed to oust Nielsen, TVision is making waves in a market dominated by a goliath who owns the gold standard. To distinguish themselves from the incumbent and position themselves for success, TVision has pushed the boundaries of technology, expanded into untapped markets, and has made their product incredibly easy to use. Let’s explore how TVision has deployed these tactics.
Using a variety of sensors including visual, 3D, and infrared, their set top box watches occupants watch TV to gauge the number of people in the room, track the attention of the viewers (eyes on the screen vs on the cell phone, etc), and qualify the emotions of the viewers using complex and patented facial recognition software. This information is packaged as “viewability and attention points” and provides an extremely accurate portrayal of the viewer and their interaction with the content on screen. To give some perspective, Nielsen’s outdated technology can tell only the age and gender of viewer. Nielsen has no idea if the viewer is actually watching the content or what their reactions are toward it.
Given this technology, TVision is able to collect a much more diverse data set that can be used to market toward consumers in a much more targeted way. To convince one of the big five TV networks to use their technology, it was as simple as getting in front of them. As people’s consumption of content grows and evolves, advertisers need to adjust to achieve alignment with consumer habits. Customers of Nielsen have been complaining for years that their data is not accurate or performance driven. Consequently, they have struggled to maintain relevance with and the attention of the millennial generation. It is clear the advertisers want a change and TVision is ready to provide insight and unlock consumer understanding in ways that Nielsen never has.
Equally important is TVision's goal to keep up with the current television market. The mobile television market has been growing at a blistering pace and every month thousands of people subscribe to services like Netflix, Hulu, and Amazon Video. To neglect these viewers, as Nielsen has, is to forego accurate and representative data collection. As a result, Nielsen’s metrics are becoming increasingly inaccurate as they fail to capture this growing population of mobile viewers. TVision has addressed this problem by outfitting one of their products with a mobile compatible component that tracks mobile viewing activity, which will take them one step closer towards solving the advertiser’s age old problem of attribution.
Starting small and niche is another key to gaining traction in a market like this one. Starting small gives you time to test and retest your product, gauge what works for both you and your clients, and put a plan in place for future growth. For any small company looking to expand in the shadows of a giant, exploring untapped markets is a safe way to introduce your product to consumers. For TVision, this meant exploring foreign markets without an already established TV rating service. In Pakistan where the TV rating market is just getting off the ground, TVision is one of the top contenders and undoubtedly has the most sophisticated and desirable technology. While these markets are tiny compared to the US, they are important to explore to test out the product and show its effectiveness in a relatively risk-free environment.
Besides having a killer product and a shrewd growth plan, TVision excels at reducing friction. Unlike Nielsen’s box which requires the viewer to input their information (age and gender) every time they turn on the TV, and prompts you after 15 minutes of inactivity, TVision sits out of sight and turns on only when viewers enter the room. They also understand the shared sentiment amongst TV advertisers in their quest for more and better data. Using their technology, they make the data easy to interpret by building reports that track viewability, attention, and viewer emotion; ultimately inching towards their future vision, where audience reactions can be monitored and advertiser decisions can be made in real time. The advertisers love it because they can see, for example, that at 7:05am on Good Morning America, viewability and attention is highest. They can use this up to the minute data to establish a price gradient for the whole program and target more viewers effectively. To further reduce friction and boost customer adoption, TVision designed their product to be a very user-friendly plug and play system that anyone can install. By eliminating the need for a house-call technician TVision has slashed roll out costs, increased consumer willingness, and will be able to expand from 600 to 5000 households by the end of this year.
While TVision is still a small company, they have demonstrated that they are capable of taking on a force like Nielsen. Their superior technology and accompanying data, prudent plan for growth in untapped markets, and ease of product use are all positioning TVision as a future leader in the TV measurement space. Companies looking to take on a market Goliath could learn from TVision Insights and what they are doing to shake up the market.
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