Shailesh Kapoor: If You Had To Choose: Bad Ratings or No Ratings?

14 Jun,2013

By Shailesh Kapoor

 

It’s been an eventful week for the television industry, the unfolding of which has been nothing short of a taut Hollywood thriller that promises to keep you on the edge of your seat. The backstory started with NDTV’s lawsuit against TAM last year, but the real action began last week when a top broadcaster (MSM) decided to hit TAM where it hurts the most, by simply pulling the plug. Times Television and a few others have followed suit. And the second act has not even started.

 

There have been many points and counterpoints, both from the broadcasting and advertising fraternity. BARC’s ratings design is not going to see the light of the day before 2014, and hence, there is a sizeable time window to handle.

 

The real question that should define the framework for this debate is: “Are the current ratings credible?” For me, the question is that and only that. Credibility is not graded. Here, there is no concept of “mostly credible”, “more credible than others” or “perhaps credible”. If the ratings system is going to influence the size of advertising revenue that it does, it has to be credible in absolute terms.

 

Anyone who follows ratings closely (many people) and understands statistics (only a handful) will agree that the current ratings system has error margins which lack statistical robustness the moment you begin to look at markets or segments which are narrow, e.g. C&S 25+ SEC A Males in 5 metros. The error margins could be as high as 30% in such segment, which means that a rating from 2.1 to 3.9 may in reality represent the same viewership, i.e., 3.0%. Now imagine doing the same for C&S 25+ SEC A Males in Bengaluru. The error margins would cross 100%.

 

In a way, TAM may have shot itself in the foot by reporting such data and allowing it to be analyzed. This attitude towards error margins could definitely not have been a result of ignorance, given the company’s rich heritage. But it seems to be a result of over-confidence, even arrogance, resulting out of being a monopolistic player in the television currency research space.

 

Understandably, you cannot install more meters because your business model prohibits the same.But is that a justification to report data that could statistically be a result of pure chance, than a reflection of reality?

 

The television industry has perhaps been guilty of going soft on the issue in the past, taking tough stands only on occasions that suit their business. Over a decade, I’ve been hearing the fig-leaf argument, i.e., “in the absence of anything else, TAM at least gives an indication”. Now that’s a compromise on the principle of credibility. That argument should have never been admissible in the first place.

 

What’s the solution, then? It’s surprisingly simple. TAM should define an “error margin” or “confidence level” at which it will report data, e.g. maximum error of 10%. It should communicate the same to the entire industry, and then report only the data that clears this filter. If this means that certain markets and audience segments cannot be analyzed, then so be it. Some channels, especially English channels, may find the results irrelevant because they won’t be able to look at certain desired TG cuts, but it’s better not to look at error-laden data in any case.

 

This may understandably result in much lesser “data” in the system, but less data of good quality should win over more data of bad quality any day. Of course, in doing this, TAM will have to admit that their error margins have been rather abysmal in the past. But the taste of a humble pie is not that bad, is it?

 

Yes, a ratings-less system will create confusion. But if I had to do the ranking, I’d say: Good Ratings > No Ratings > Bad Ratings. For those suggesting Bad Ratings > No Ratings, a masterclass in statistics is highly recommended.

 

Shailesh Kapoor is founder and CEO of media insights firm Ormax Media. He spent nine years in the television industry before turning entrepreneur. The views expressed here are his own. He can be reached at his Twitter handle @shaileshkapoor

 

Post a Comment 

One response to “Shailesh Kapoor: If You Had To Choose: Bad Ratings or No Ratings?”

  1. AcK says:

    Dear Shailesh,

    Is it only the job of TAM to make sure of its data integrity, on the assumption that the rest of the industry is made up of idiots, or is the industry also going to show some integrity. The same set of broadcasters that are leaving TAM by the hoards are guilty of slicing and dicing data to suit their needs. I would presume that instead of tweaking the software to disable any data with >10pc error rate, it would make a lot more sense to ‘transparently’ provide reference points where error rates >10%. Oh wait, TAM already did that with the latest guidelines on standard usage of TAM data. But will the industry listen (idiots, all of them).

    AcK.

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