No Longer Up For Debate: Engagement Means Money

Consumer engagement has been one of the most talked-about marketing issues for years. But now, armed with a new array of research and planning tools, media agencies are taking the engagement debate to a new level and making it a bargaining chip in this year’s television upfront marketplace.

TV networks now face the prospect of gaining or losing revenue based in part on engagement-related factors such as clutter and a willingness to guarantee buys on metrics that go beyond the number of viewers reached in a given demographic.

Case in point: Publicis Groupe’s MediaVest has created a new engagement metric it calls the Viewer Connection Index, which ranks broadcast and cable TV networks based on levels of ad clutter, the length of advertising pods and the number of elements within those pods.

Agency executives point to research showing that higher levels of clutter lead to lower recall of ads by consumers, which in turn equates to less-effective ad spending and a lower return on the investment. In effect, what the new MediaVest index does is put a higher value on networks that have less clutter and a lower value to more cluttered networks.

“We’re not evaluating deals based only on price,” said Pam Zucker, svp, marketplace ignition, MediaVest, who developed the Viewer Connection Index. “We are adjusting price to include the viewer’s experience. The networks make it either a better experience or a worse experience by the way they format their shows. We are trying to understand current network formatting and what type of viewer experience that leads to and what we would like to alter to create a better viewing experience.”

Independent Horizon Media has created its own index that applies engagement metrics to some 40 traditional and alternative media, from broadcasting and cable to wireless, online and an array of out-of-home outlets. “It’s bigger than television,” says Carl Kotheimer, evp, marketing services, of the engagement issue. “It’s about every communication channel, and we’re measuring the relevance and importance of those channels to a brand’s target consumer groups.”

With its Communica- tions Channel Relevance Index, Horizon has already made “significant shifts” in the media mix for many clients. For some clients, that means money has been taken out of the upfront and shifted to alternative media; for others, dollars have shifted to cable from broadcast, or vice versa.

Horizon won’t say exactly how the index works. “We talk to thousands of current consumers in real time about usage and importance of media type with regard to product purchase decisions,” says Horizon CEO Bill Koenigsberg. Survey data is then applied to a process that includes a proprietary algorithm.

Meanwhile, media agencies say they want guarantees from networks this year that go beyond impressions and address audience attentiveness. A toe-hold was gained on that front last season when two cable networks, Court TV and The Weather Channel, did a handful of deals that offered engagement guarantees based on metrics such as “length of tune” (how long viewers stay tuned to a network without changing the channel) and monthly cumulative audience, as well as proprietary engagement metrics that agencies declined to identify.

Agencies say they were pleased with the results and want to expand those guarantees across a wider group of networks this season.

At Court TV, Charlie Collier, evp/ general manager advertising sales, said there was “a lot of interest” in obtaining engagement guarantees this year on the part of advertisers. He said the four agencies that did such deals last year—Starcom, Carat, Magna Global and Mediaedge:cia—”all seemed to be pretty happy” with the results.

“The hard part is managing the demand, because there is a large degree of risk in doing this,” he said. “It’s really changed the way we look at our business.”

As for Starcom’s deal with Court TV last year, Chris Boothe, evp, group client leader, said, “Yes, we were happy with the way it turned out, and we are looking to evolve it further as we go into this upfront.”

In fact, the Publicis shop is playing the engagement card with every network it talks to, he said. “It’s a huge priority for the company. Last year was the first step, this year we’re ready to run the marathon,” he said.

It’s a priority for WPP Group’s MindShare as well, said Shari Cohen, president and co-executive director, national broadcast. “We’ve gone beyond getting the best price—that’s a given,” she said. Now the focus is on “what am I paying for? Are viewers engaged, attentive, and do they go out and buy the product?”

Asked if networks with more cluttered viewing might suffer in the upfront in terms of what advertisers would be willing to pay them, Carat USA president Ray Warren said, “Yes, that’s absolutely true.” But, he insisted, there is a “sense of collaboration in the marketplace that we’ve got to figure this out [together].”

It won’t be easy. Part of the problem, says Stacey Lynn Koerner, president Consumer Experience Practice, Interpublic Media, is that different networks have different definitions for engagement, depending in part on how consumers watch them. The way people watch The Weather Channel is different from the way they watch ESPN or ABC. “There’s not a one-size-fits-all kind of solution,” she said.

David Poltrack, evp, chief research officer at CBS, points to another engagement issue: the appeal, or lack there of, of the ads themselves. Any engagement guarantee, he says, has to be “limited to confirmation that communication of the message has been made, not the response to it, because we don’t have any control over the message.”

But neither the networks nor the agencies can spend too much time pointing fingers, because there’s a lot of work to be done. As one media agency head said, now that Court TV and Weather have broken the ice, “it forces everybody else to get out in front of it too.”