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PPM DATA PAINTS NEW PICTURE OF RADIO AUDIENCE

More Stations Listened to; Morning Drive Ratings Down 35%

September 21, 2005

NEW YORK (AdAge.com) -- Radio listeners tune into twice as many stations and their listening time is about 50% lower than reported under the old paper diary measurement system, according to data from Arbitron’s portable people meter (PPM) trial in Houston.

Arbitron yesterday released top-line data from its summer PPM trial in Houston, and the new numbers could have major implications for the way radio is planned, bought and sold.

35% decrease
Under the PPM system, station rankings in the Houston metro market remained largely unchanged when compared to diaries, but morning-drive ratings decreased significantly across the market, from a 14.2 rating to 9.2. Morning drive, Arbitron has found, is a daypart that diary keepers commonly overreport. Afternoon drive, evenings and weekends saw less of a falloff.

“The PPM data show what lots of other studies show -- that the diary tends to understate the variety of stations people are listening to,” said media planning consultant Erwin Ephron. “It understates reach and overstates the volume ... which means ratings are slightly lower.”

Pierre Bouvard, president of Arbitron's portable people meter and international initiatives, said, “We saw a very consistent [cumulative] increase across the marketplace. In our conversations with advertisers and agencies they say this is the sticking point. Radio is a reach medium and it doesn’t know it.”

Houston is second trial
Although Arbitron currently measures U.S. radio ratings using a paper diary system, its PPM technology has been used to measure media in Canada, Belgium and Singapore. The Houston PPM trial is the second one the company has conducted in the U.S. (the first was in Philadelphia) and was chosen because of its diverse population. The trial measured the listening habits of 2,100 consumers, age 6 and older.

PPM is a passive measurement system in which participants carry a small pagerlike device that picks up inaudible codes embedded within the audio streams. Participants must carry the device with them at least 8 hours a day to be included in the sample (PPM’s motion sensor can detect when a participant leaves the device on the dresser at home) and place the device into a docking station at night to send data to Arbitron.

The practice of having a listener hand-record every single time he or she flips the radio dial tends to undercount the number of stations listened to during the day. For example, the average diary indicates a person listens to about 2.2 stations while the average PPM indicates about 4.2 stations. Additionally, Hispanics listen to more stations than the rest of the market -- 5.5 on average.

Drop in AQH
Yet because time spent tuning in each occasion was shorter, AQH, or average quarter hour ratings, dropped. Mr. Bouvard said this is because the diary system reported twice the number of respondents who listened for more than 25 hours to a particular station. Fewer numbers of those “heavy listening” respondents in the PPM system pulled the average time spent listening down.

“Radio’s always been positioned as a frequency medium because it’s relentlessly retail oriented,” Mr. Ephron said. “But that’s not the way buying is done nationally. Radio has reach capabilities that are often ignored.” He said the PPM figures make that argument “more compelling.”

In addition to radio, PPM measures other media, including in-store audio and both in-home and out-of-home TV viewing. Arbitron found that despite misconceptions that out-of-home TV viewing is typically relegated to men in bars, levels were very similar between men and women. It also found the majority of out-of-home viewing occurs during weekdays from 9 a.m. to 4 p.m., not in the evenings.

DVR shifting measured
Because every inaudible code is also time-stamped, the PPM can measure time-shifted media consumption as well. About 9% of its PPM panelists lived in DVR households, and Arbitron found that about 7% of TV viewing by those panelists was time-shifted. Of those time-shifted programs, about 80% were viewed the next day and about 90% were viewed within two days.

Arbitron said it will continue to release additional Houston PPM data every month. Mr. Bouvard said the company is still open to a joint venture with Nielsen, which would use PPM technology for a passively measured TV ratings system.