Age and sex are irrelevant. This is the stance CBS‘s research chief David Poltrack is taking as he partners with Nielsen to re-engineer CBS’ media planning and buying model. Demographics will be pushed aside in favour of viewer attitudes and behavior.
The proposed model is a better predictor of what people buy and what makes them buy than demographics ever were, Poltrack said in a speech to the Advertising Research Foundation’s Re:Think 2011 conference Tuesday in New York.
A growing amount of data that matches audience measurement with purchase information shows that using demographics to target commercials is “essentially invalid,” he said, “resulting in a misallocation of television advertising investments.”
Although CBS paid for the extensive research and analysis used to create the new model, the data and analytics surrounding it will be available to all Nielsen clients, including CBS rivals, Poltrack said, “in the spirit of open source.”
Various parts of Nielsen pitched in, including recently acquired consulting firm Cambridge Group and Nielsen Catalina Solutions, a joint venture that combines data from Nielsen’s TV, set-top box, consumer and online panels with Catalina Marketing’s shopper loyalty-card purchase data. CBS is also running a series of experiments with advertisers to fine-tune the system, Poltrack said.
CBS purchased Nielsen Catalina data for 20 categories in health and beauty, household, pet and food products and has studied 15 of them in depth so far. The data confirmed what other smaller studies have shown in the past, according to Poltrack: “There is no link, none, between the age of the specified demographic delivery of the campaign and the sales generated by that campaign.”
Looking at snack foods, only three among the dozens of TV shows most watched by “heavy snacking households” also appear on the list of top shows among viewers aged 18-49, Poltrack said during his talk, “yet many of the advertisers in this category buy based on age demographics.”
So where does the data show a link? “Delivery of heavy users of the product category does have a significant correlation with post-exposure purchase behavior,” he said.
In a separate presentation Monday, executives of Nielsen Catalina said ratings demographics by age and sex had a relatively low 0.12 correlation with actual sales produced by exposure to TV ads, where 1.0 is complete correlation and 0 signals no relationship whatsoever. The presence of heavy category users in a TV show’s audience, on the other hand, had a much higher 0.69 correlation with sales lift among those exposed to ads on the show.
Poltrack acknowledged that age in particular hasn’t been favorable for CBS. Indeed, in the week ended March 13, for example, CBS nearly matched Fox for overall average viewership in prime-time, trailing by only 10,000 people at 7.97 to 7.96 million, according to Nielsen data reported by TVByTheNumbers.com. But Fox blew past CBS in ratings among viewers aged 18 to 49, with an average 3.4 rating to CBS’ 2.1.
Poltrack added that reliance on the 18 to 49 demographic is hazardous to all media and marketers, partly because it doesn’t strongly correlate with purchases and partly because it’s declining fast. That group’s share of U.S. population declined from 62% to 57% between 2002 and last year, he said, and will drop another two points to 55% by 2016.
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