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What: Facebook recently agreed to an audit of the information it provides to marketers and announced new and improved measurement tools for reachability.
Why It Matters: While the announcement was welcome in the industry, it seemed overdue to some. Just how much it will impact media plans across the board is yet to be seen. What executives at Walton Isaacson, Zubi Advertising and MBMG Media Group have to say.

The announcement was made less than two weeks after Procter & Gamble’s chief brand officer, Marc S. Pritchard, advocated for more transparency on the part of digital ad platforms. But this seems overdue to many in the industry, as an ongoing debate over the accuracy of the platform’s data (and that of other platforms as well, for that matter) ensues.

Worries were justified: last year, Facebook had to admit inaccuracies in its ad measurement tools. Now, the nonprofit Media Rating Council will conduct an audit to “verify the accuracy of the information” Facebook is providing for marketers, and will also be working with 24 third-party measurement companies.

At the Interactive Advertising Bureau’s January 29 conference, Pritchard went as far as to say that online marketing was “crappy” and that the platforms need to “grow up,” when it comes to reporting on viewability and ad performance.

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The new measurement tools may be more exciting than the third-party auditing to some. In the same blog, Facebook announced that it would be releasing a tool in the ad creation flow that shows advertisers the number of users they can expect to reach with potential ad campaigns.

Albert Thompson, a digital strategist at full service marketing agency Walton Isaacson, was interested in the tools’ appeal to those who doubt Facebook’s reach in terms of generating meaningful engagement: “Seems FB has taken one step further in an attempt to ‘jump the shark’ through promoting its estimated reach tool to support the reassurance that the social giant’s value lies in buying ‘people’ and their engagements and not just pages (noted by digital impressions).”

Others are cautiously optimistic: “I think it will be interesting to see what the results of the audit will be, and how Facebook compares to other large media outlets on key metrics, especially video completions and viewability,” said Zach Rosenberg, the president of MBMG Media Group.

Buyers will now have the option of holding Facebook to the same standards as other partners on our plans and optimize or adjust accordingly as a result.

Marian Lozano, Associate Media Director at Zubi Advertising, said that while she agrees that the move was overdue, the important development is that “buyers will now have the option of holding Facebook to the same standards as other partners on our plans and optimize or adjust accordingly as a result.”

She recognized that while she agreed that the move was overdue, it will inevitably have an impact: “Particularly as it relates to targeting Hispanics online, ad measurement and audience validation is critical for all of our clients’ digital campaigns,” and that “platform updates like this will be key to restore whatever degree of skepticism has crept into the minds of today’s media buying circles.”

WPP’s stake in comScore no cause for concern among media agencies, who applaud the potential of the partnership.

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ComScore-WPP: Half full or half empty?

Kantar and comScore have allied to provide what they’re calling best-of-breed, cross-media audience- and campaign-measurement to the international realm. Kantar, WPP’s data investment management decision, will work with comScore to integrate their technologies, and comScore will acquire the assets of Kantar’s Internet audience measurement businesses in certain European markets. To deepen the relationship, WPP will take an approximate 20 percent stake in comScore.

There is still a major gap for advertisers and agencies to crack the media measurement code.

Overall, I think it’s a very positive thing for the industry,” says Justin Kuykendall, CEO of Pulpo Media. “There is still a major gap for advertisers and agencies to crack the media measurement code.”

The international angle makes this a strong play, according to Ludmila Palašìn, associate director of The Media Kitchen. She says, “Since this deal involves only European audience measurement assets, we think this is terrific for our international clients. Cross-media measurement is an ongoing challenge everywhere. This agreement makes us more responsive to our international clients’ cross-media measurement challenges.”

There’s potential synergy in the combination, according to Alex Kalluf, director of intelligence at Figliulo&Partners. Kantar has some strong cross-platform offerings, while comScore rocks in digital. In addition, the two are complementary in international markets. Says Kalluf, “Especially in Latin America, Brazil and China, they will have a stronger offering.”

There is a potential downside to this partnership, Kalluf says: “There’s a lot of overlap between some of the Kantar companies and what comScore does.” If the two decide to roll some of those up into a unified offering, it could lead to fewer options for agencies.

Media execs did not seem concerned about a potential for undue influence by WPP because of its stake in comScore. WPP isn’t about to kill this golden data goose, they said.

“There’s a lot of overlap between some of the Kantar companies and what comScore does.

Captura de pantalla 2014-12-08 a la(s) 18.20.17“WPP is not about to invest in a partnership and then destroy one of the main the reasons the partnership was struck in the first place,” Palašìn says. “If WPP influenced comScore’s research in any way, comScore would lose its primary asset—its reputation for objectivity.”

One thing to watch, according to Kalluf, is whether WPP might tighten comScore’s purse strings. While WPP gives Kantar a lot of independence, he notes, large corporations are more reluctant to spend money. To date, comScore has invested heavily in new products. With WPP keeping an eye on its investment, he says, “ComScore might lose the ability to innovate as fast. Something to watch is how comScore will keep innovating and coming up with new solutions.”

Kuykendall thinks the deal will help companies like Pulpo Media, which, since it was acquired by Entravision last year, includes TV and radio properties as well as digital. “Advertisers are looking to see how different properties work together, and they want to see their investment across all those platforms and how each contributes to the ROI they’re getting.”

Nevertheless, he doesn’t see the Kantar/comScore combo as the ultimate measurement solution. I think one of the reasons WPP is investing in comScore is because it’s a hard problem to solve. Most advertisers and agencies would argue there is still a lot of work to be done.”

What: WPP’s wholly-owned companies, GroupM, and Kantar Media have partnered with measurement company Rentrak to deliver new services in television measurement and consumer insights to clients in the United States.
Why it matters: WPP will add Kantar Media’s US television measurement business into Rentrak in exchange for US $98 million of Rentrak common stock.In return, Rentrak gets Kantar Media’s TV measurement business in the US.

descarga (3)WPP‘s wholly-owned companies, GroupM, the global media investment management company and Kantar Media, its media research and analytics business, have partnered with Rentrak, the US-based film and television measurement company. The partnerships are designed to deliver new services in television measurement and consumer insights to clients in the United States.

Under the terms of the agreement, WPP will add Kantar Media’s US television measurement business into Rentrak in exchange for US $98 million of Rentrak common stock. WPP will also purchase shares directly from the company for US $56 million in cash giving WPP a final ownership stake of 16.7% of Rentrak.

Through the terms of the deal, WPP’s various companies, like media agency GroupM, will now have access to Rentrak’s local-and-national TV viewing data and measurement to combine with Kantar’s digital media and purchase data.The transaction, when closed, will include Kantar Media’s customer contracts and customer relationships involved in U.S. television measurement, creating the benefits of clarity and simplicity for clients in the U.S. TV ratings marketplace with a single and passive TV measurement ratings service. This transaction gives Rentrak and Kantar better scale to rapidly innovate their products and services in the United States. No Kantar Media TV measurement or global development capabilities outside of the United States are affected by this transaction.

Under the agreement, Rentrak will also integrate its national and local TV measurement with a number of Kantar’s U.S.-based services that focus on digital media, advertising expenditure and purchase data. The integration will provide advertisers, agencies, TV networks, multichannel video program distributors (MVPDs) and local television stations throughout the U.S. with even more powerful tools to understand consumers’ purchasing habits and the ability to link TV viewing habits with purchase and other behavior in the United States.

“Irwin Gottlieb and Rino Scanzoni of GroupM are right on target about how this kind of scaled viewing and purchase behavior data for targeting and measurement is critical for the future of TV ad business as audience fragmentation continues to accelerate,” said Dave Morgan, founder and CEO of venture-funded TV ad targeting company Simulmedia.

The transaction, which is subject to customary regulatory approvals, is anticipated to be completed by the end of calendar 2014.Goldman, Sachs & Co. served as financial advisor to Rentrak.No Kantar TV measurement or global development capabilities outside of the US are affected by the transaction. 

Financial implications

The deal will help position audience-based TV buying as a complement to content-based or program-specific buys. An important step, as dollars begin to move between programmatic video and linear television.These agreements continue WPP’s strategy of developing its services in important markets and sectors and strengthening its capabilities in digital and data investment management businesses.

These agreements continue WPP’s strategy of developing its services in important markets  and strengthening its capabilities in digital and data investment management businesses

WPP’s digital revenues surpassed US $6 billion last year, and accounted for approximately 35% of the holding group’s total revenues of US $17.3 billion. The group projected as much as a 10% increase to 40-45% for digital as a percent of total revenue within the next five years.WPP has steadily invested in tech from outside companies. Last month, the company deprived itself of digital media platform Open AdStream from Xaxis, selling the tech to AppNexus for US$25 million. This move, in turn, gave WPP a roughly 15% stake in the ad tech company’s US$1 billion-plus business.

However, it seems that GroupM’s partnership with Nielsen, a Rentrak competitor, could be affected by this acquisition.

From a financial standpoint, the deal gives Rentrak an incremental revenue boost of US $7 million to US $9 million annually, according to PiperJaffray analysts in a research note. Rentrak expects the agreement to produce multiple long-term revenue streams resulting directly from the acquisition of Kantar’s TV service, as well as from anticipated future joint marketing agreements with Kantar and the company’s expanded relationship with, and endorsement from, GroupM.