Cumulus CEO Lew Dickey isn’t worried about having radio ratings only once a year in his company’s 50 smaller markets. He told RBR/TVBR that advertisers are concerned about the quality of data and he said it was value, not price, that drove the Cumulus effort to find a new ratings vendor. With its reputation established in television, Dickey calls Nielsen the “gold standard” for media measurement and says its launch of a new radio ratings service is an “excellent development for radio.”
“We couldn’t be more pleased with the outcome on this because we now have the largest company in the world in audience measurement that is proving a product that is superior to the product that we’ve been receiving,” Dickey said. “And along with that delivering a ringing endorsement of our medium.”
Nielsen was not one of the 10 or 12 companies which initially submitted proposals under the Cumulus RFP to find a new ratings product for its smaller markets. Dickey said the company then cast a wider net and Nielsen was among those that it contacted. He said the criteria “naturally evolved” along the way, which explains why the winning proposal is based on diary measurement, which had been a no-no in the original RFP.
Dickey had been a vocal critic of the quality of Arbitron’s ratings product in smaller markets. He complained of “massive undersampling” and large fluctuations from book to book. He insists that measuring only once a year will not be a problem with advertisers. “Advertisers are looking for quality data so they can make their decisions,” he said.
Dickey also insisted that price was not the driving factor in selecting a new ratings service. He said the contract with Nielsen is “margin neutral” for Cumulus, although he hopes to eventually come out ahead by being able to boost ad revenues by having better data and being able to increase the confidence level of advertisers. “We didn’t buy price, this is an issue of value,” he said.
Single-source qualitative data is also a plus for Cumulus’ sellers. “We feel that the present measurement system is ineffective because it works more to the benefit of the advertiser than the radio station. We have value stories to sell in each of these markets…we feel that the current system does too much to commoditize our product,” Dickey said. “With this system, having single-source data, which includes qualitative and quantitative, it provides a much clearer picture of the audience, of the community of listeners that we’re delivering with each of our distinctive brands,” he said.
With the switch over, Cumulus will not be permitted to use the Fall 2008 Arbitron book in those 50 markets once the next Arbitron survey is issued and the first Nielsen data will not be delivered until August. So, there will be “a few months where we’ll be naked,” Dickey confirmed.