Arbitron, P&G and VNU Team on Research Tool

NEW YORK Arbitron today unveiled a landmark deal with VNU that could accelerate the commercial deployment of the portable people meter not for TV and radio ratings, but as a marketing research tool.

The two companies have agreed to jointly explore the development of a new national marketing research service that combines the PPM, which tracks TV and radio audiences, with ACNielsen’s Homescan, an in-home product tracking service. As part of the deal, Procter & Gamble, the nation’s largest advertiser, has agreed to collaborate with the two companies on the design of the potential service. Financial details were not disclosed.

With P&G’s expertise, Arbitron and VNU (which owns Nielsen as well as Adweek Magazines) will be seeking “the support of a broad cross section of marketers including other packaged goods providers, retailers, automotive marketers, telecommunications providers, financial services firms, as well as many other companies,” said Steve Morris, president and CEO of Arbitron. If all goes as planned, the new service could launch in 2005.

The marketing service would give advertisers like P&G new insights into the interaction between consumers’ media habits and their purchase behavior from a panel of 70,000 consumers in 30,000 households. Having the two measures in one service could effect how advertisers invest their media dollars and target prospective consumers.

“The consumer is boss at P&G” said Greg Ross, director of P&G North America media and marketing in a prepared statement. “This new research approach will help marketers learn more about how consumer media and shopping habits are changing. It offers the potential for a breakthrough in consumer understanding about how and when consumers are most receptive to brand information.”

The concept of a research service that would collect media and product consumption from a single panel of consumers has been pursued for more than two decades. In the 1980s, Arbitron attempted to marry a push-button people meter with an in-home scanner wand in a service called ScanAmerica.

Arbitron and VNU are betting that improvements in technology and advertisers’ pressing need to sort through an increasingly fragmented media environment will make this attempt a success while others like ScanAmerica failed.

For seven months last year, Arbitron conducted a marketing panel pilot study in Philadelphia, which demonstrated the feasibility of combining PPM audience measurement data with the collection of other consumer marketing information from a single panel of consumers.

“Today’s consumer marketplace is fast-moving and complex, and we want to provide a range of services that help our clients fully optimize their marketing activities. We believe a broader understanding of the impact of media and marketing activities on consumer behavior should provide benefits for both the industry and the consumers it services,” added Michael Connors, chairman and CEO of VNU’s media measurement and information group

Adding audience measurement to ACNielsen’s Homescan service also gives VNU a strong competitive edge over its primary rival, Information Resources Inc.

Arbitron has been testing the portable people meter in the U.S. with support from Nielsen Media Research since 2000. The PPM is a passive, pager-size device worn or carried by consumers that tracks inaudible codes embedded in TV, cable and radio signals. Although Nielsen has the option to form a joint venture to commercially deploy the PPM for local market ratings, the deal to deploy the PPM as a marketing tool is a separate agreement, the companies said.