Ratings, Audiences, & Failed Shows

Transcription

1 Ratings, Audiences, & Failed Shows

2 TELEVISION RATINGS

3 Before the Show Airs A New Season TV networks test programs Subjects view pilots or season finales for current shows in theaters. Meters record their attitude toward the program shown.

4 Learning More About Broadcast Audiences Program-makers can then re-shoot shows to make them more likeable TVQ: A measurement of audience attitude toward tv actors

5 Q Scores The film industry assumes they draw viewers. A star s Q Score measures star s familiarity and appeal with audiences. 5

6 Television Ratings Ratings are the most dominant decision making data in commercial television For local broadcast stations For broadcast networks For cable networks

7 Television Ratings Television executives need television ratings to: Establish advertising rates Make program decisions by methods of comparison Make program decisions by knowing who is and who is NOT watching

8 Television Ratings Nielsen Media Research collects data through: Diaries Peoplemeters Each method has strengths and weaknesses.

9 Syndicated Audience Data Collection Diary: Ask people to keep a diary of what they watch Peoplemeter: Records what channel is being watched as well as who is watching it

10 Television Ratings National Station Index (NSI) Information is provided quarterly to each of the stations in the United States. Information is collected through Peoplemeters in the top 60 markets; diaries are used in remaining markets. w DMA: designated market area (each county in the U.S. is assigned to one television market even though residents may receive overlapping signals) w The number of television household in the DMA determines the market s size or rank.

11 Television Ratings Viewers in more than 200 television markets are surveyed at least four times a year in four-week periods called sweeps. Major rating periods are February, May, July and November. This is when you ll see the best TV.

12 Television Ratings Ratings measure: w If the television set is on w What channel the set is tuned to w Demographic information about who is watching

13 Television Ratings Ratings don t measure: w If the person is watching actively or passively w Why the person watched w The quality of the program

14 Nielsen Television Index (NTI) This sample is representative of the population of the United States according to demos. About 3,100 households (out of million HH) are randomly selected from throughout the U.S. to participate. w Each family represents a specific number of households in their market (New York, Los Angeles, etc.), which helps determine the 'share' each program generates. These ratings are compiled daily and weekly and information is provided to networks and the media.

15 Key Terms Rating: the percentage of the total survey universe watching a specific program or channel at a particular time w The number of households tuned to a particular program the total number of households owning a TV set. w For example, if 1,000 homes have televisions and 100 of those homes have the TV on and tuned to a specific show, then that show's rating is 100 divided by 1,000, or 10 percent. Share: the percentage of the survey universe with TV sets on watching a particular program or channel at a specific time w The number of households tuned to a particular program the total number of households using a TV set at the time of the program s broadcast. w For example, if 1,000 homes have TVs, 500 of those homes have the TV on and 100 homes are watching a particular show, then the show's share is 100 divided by 500, or 20 percent. In contrast, the show's rating is 10 percent. Note the distinction here: a rating is based the entire sample (whether they're watching TV or not) while a share is based on those actively watching television.

16 ??/?? There are times you will see TV rating numbers that look like this: 5.2/14. What s that? w The first number is the rating and the 2nd number is the share. The 5.2 (rating) is the estimated percentage of Nielsen households that watched the show. The 14 (share) is the percentage of all their people watching that specific show, or all of the Nielsen families watching TV at that time. w In other words, 5.2% of all homes had the TV tuned to series X. Of all people (not homes) watching TV, 14% of them were watching TV series X.

17 Television Ratings Season to date (ending February 15, 2015): CBS: 2.5/9 ABC: 2.1/6 NBC: 2.8/7 Fox: 2.1/5 CW: 0.8/2 Which network has the best ratings in the demographic? Which network has the largest share? Which network has the largest amount of viewers?

18 Television Ratings Drawbacks of the Current System Information may be inaccurate Stations/networks/programs can influence regular viewing habits with stunts, contests, promotions, news series. Etc. Little measurement of group viewing Lack of minority representation Ratings periods often determine programming slates

19 Criticism of Audience Measurement Only 5000 U. S. households surveyed to determine national audience size & traits. Only home reception surveyed. Is self-reporting, especially in diaries, truthful or accurate? w Often completed after the fact. w Often votes for favorites rather than actual behavior. w Recall often in error. w Subject may distort diary to hide certain behaviors. w Some demographics require statistical manipulation.

20 Television Ratings Other Means of Measurement Focus Groups Targeted Research

21 CABLE

22 Cable Logic Broadcast networks are constrained by the scarcity of time in their primetime schedules. Cable networks don't fill their primetime schedules with new programming, so they behave differently, because they can. Broadcast networks fill every Sunday-Friday primetime hour with something original, cable does not. Broadcast networks have to cancel existing shows to make room for new shows. That makes predicting what they ll do much more systematic. Cable networks do not have to cancel existing original shows to add new ones, because even the ones that produce lots of original shows still have primetime hours in which to add new ones. Broadcast networks cancel their lower rated shows to make room for new ones every season. Cable networks simply don t behave that way, because they don't have to. w Therefore, ratings MATTER, but only for advertising and to compare to other cable networks.

23 THE NETFLIX MODEL

24 No Ratings for Netflix Netflix has never provided concrete data validating that its shows are watched by large numbers of viewers. Ratings are important on traditional television because they help networks attract advertising. Netflix doesn t sell ads and has argued that it therefore shouldn t have to disclose its ratings. w It creates a benchmark that is irrelevant to the business but sexy and exciting to write about and puts a lot of performance pressure on shows that otherwise will be great shows over time, -- chief content officer Ted Sarandos

25 The Benefits of Ratings Netflix viewership data would give traditional TV networks a better sense of how popular their shows are on the platform and, perhaps more importantly, how essential they are to the overall Netflix experience. This could affect negotiations for licensing programming, especially as more content companies such as CBS and Comcast launch their own streaming services. w Networks already regularly leverage the popularity of their programming to extract higher fees from cable operators Ratings also help attract talent in the traditional TV world. HBO has risen to the top of the premium cable heap by continually serving up shows that are both critically acclaimed and extremely popular. If Netflix s original shows are revealed to be watched less than those on TV, it might be harder to attract a David Fincher or a Kevin Spacey to the streaming service

26 Netflix Knows Data The reality is that Netflix is a data-driven company. Analytics gives businesses the quantitative data they need to make better, more informed decisions and improve their services. Then, the companies can optimize their marketing and deliver a better product. (Without analytics, companies are in the dark about their customers.)

27 Data Netflix has over 57 million members in nearly 50 countries Having this large user base allows Netflix to gather a tremendous amount of data. With this data, Netflix can make better decisions and ultimately make users happier with their service. Traditional television networks don t have these kinds of privileges in their broadcasting. Ratings are just approximations, green-lighting a pilot is based on tradition and intuition. Netflix has the advantage, because being an internet company allows Netflix to know their customers well, not just have a persona or idea of what their average customer is like.

28 Example If you re watching a series like Arrested Development, Netflix is able to see (on a large scale) the completion rate (for lack of a better term) of users. For example, the people at Netflix could ask themselves How many users who started Arrested Development (from season 1) finished it to the end of season 3? Then they get an answer. Let s say it s 70%. Then they ask Where was the common cut off point for users? What did the other 30% of users do? How big of a time gap was there between when consumers watched one episode and when they watched the next? We need to get a good idea of the overall engagement of this show. They then gather this data and see user trends to understand engagement at a deep level. If Netflix saw that 70% of users watched all seasons available of a cancelled show, that may provoke some interest in restarting Arrested Development. They know there s a good chance users will watch the new season.

29 Netflix Knows Events When you pause, rewind, or fast forward What day you watch content (Netflix has found people watch TV shows during the week and movies during the weekend.) The date/time you watch Where you watch (zip code) What device you use to watch (Do you like to use your tablet for TV shows and your Roku for movies? Do people access the Just for Kids feature more on their ipads, etc.?) When you pause and leave content (and if you ever come back) The ratings given (about 4 billion per day) Searches (about 3 million per day) Browsing and scrolling behavior Netflix also looks at data within movies. They take various screen shots to look at in the moment characteristics. Netflix has confirmed they know when the credits start rolling; and maybe more than that... Why does Netflix want to know when the credits roll? They probably want to see what users do afterward. Do they leave the app or go back to browsing? Notice how Netflix now offers movie recommendations (they have personalization algorithms that aim to accurately predict what users will watch next) soon after credits start (or, for television shows, they automatically play the next episode).

30 Keeping Subscribers Through their analytics, Netflix may know how much content users need to watch in order to be less likely to cancel. For instance, maybe they know If we can get each user to watch at least 15 hours of content each month, they are 75% less likely to cancel. If they drop below 5 hours, there is a 95% chance they will cancel. So now that they have this data, they can ask themselves How do we help users watch at least 15 hours of content per month? One idea: enable post-play, which automatically plays the next episode of a TV show unless the user opts out. Netflix asks new users to rate their interest in movie genres and rate any movies they ve already seen. Why do they do this right up front? Because helping users discover new movies and TV shows they ll enjoy is integral to Netflix s success. If people run out of things they want to watch and have no way to find new movies, they ll cancel. It s important that Netflix puts a lot of focus on making sure they have an accurate algorithm for this rather than having users rely on outside sources to find new movies. w 75% of viewer activity is based on official Netflix recs

31 The Case of House of Cards Netflix outbid HBO, AMC, among others to earn the rights for a US version of the British House of Cards w Netflix landed the drama project by offering commitment of two seasons, or 26 episodes w At a cost of $4 million to $6 million an episode, this 2-season price tag is over $100 million. w The $100 million show wasn t made solely because it seemed like a good plot. w The decision was based on a number of factors and seemingly almost entirely on data. Before green-lighting House of Cards, Netflix knew: w A lot of users watched the David Fincher directed movie The Social Network from beginning to end. w The British version of House of Cards has been well watched. w Those who watched the British version House of Cards also watched Kevin Spacey films and/or films directed by David Fincher. Each of these 3 factors made the show VERY attractive to Netflix.

32 Promotion Now that Netflix has made the $100 million investment, they are in part responsible for promoting it. With the data they had, they could make a personalized trailer for each type of Netflix member, not a one size fits all trailer. Netflix made 10 different cuts of the trailer for House of Cards, each geared toward different audiences. The trailer you saw was based on your previous viewing behavior. w If you watched a lot of Kevin Spacey he was featured. w If you watched a lot of strong female characters you saw a trailer featuring the women in the show. w If you watched David Fincher you saw a trailer featuring his style of storytelling.

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