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A key precursor to advertising dollars is the ability to effectively measure audience response and behavior.  It starts with the basics: how many people are watching.  Then it gets to the who and where.  Eventually, if there’s enough data to determine it, it becomes more and more targeted, more and more specific.  The more you know about the audience, the better you can serve advertising to their interests.  And the more you can target the advertising, the higher you can charge for it.

This kind of information based advertising has been the formula for Internet billions.   It’s at the core of Google’s success.   And now Google is hoping to expand that formula to television.   Doing so, however, will require partners and new techniques.

Unlike the Internet, where everyone leaves  a footprint, where every website can capture pools of data to later mine for value,  Television, is largely a one way street.  A viewer’s behavior is far less transparent.  Modern set top boxes sometimes track viewing behavior with regard to Digital Video Recorders; whether you forwarded through a commercial, for example.  And subscription services like TiVo can capture your track your viewing habits to help record programs of interest.  But generally, the pool of information is not there.  Television doesn’t leave a trail of breadcrumbs to tell broadcasters what you were up to, not unless you participate in survey groups like those run by the Nielsen company.

Since April, Google has been running a small program to auction some advertising time on EchoStar’s Dish Network satellite TV service.  But limited to just 13m subscribers, and far less data usage data than can be gathered online, the program has been limited.   Google’s ability to target the ad sales is also handcuffed by their lack of data.  That’s something they want to change.  The Google formula is built around targeting, around more effectively placing ads than others.  If they can’t offer that in TV, they can’t do much more than anyone else.

Today, Google is expected to announce a partnership with the Nielsen Company.  It’s a move that will try and bring them the data they otherwise havent’ had.   It’s a move that will try and give them tools to target TV ads better than ever.

For undisclosed terms, Google will buy reams of demographic data from Nielsen about who is watching what shows.  Since the 1950’s, that has been Nielsen’s domain. (They also track data in most major media categories, and publish a number of trades including The Hollywood Reporter.) In TV tracking, through the elective participation of a large pool of households (about 13k homes), they monitor a host of television usage patterns and earmark them with demographic information like age, gender and income levels.  

With terms of the deal undisclosed, the value propositions are a little speculative.  Google’s desire to bundle ad sales across media platforms and bring effective targeting to all is widely understood.  This fits into that agenda.  Google is shaking up Madison Avenue.  They’re reaching into ad markets from print, to TV, to radio, to video games.  Buying any data that helps them do a  better job of reaching those goals is a clear value. 

It’s less apparent what Nielsen stands to gain.   Cash is an obvious component (and Google has plenty to offer.)  It’s also highly likely that the deal includes some elements of data sharing.   As media markets converge, new technology blending into old, rating services like Nielsen need to adapt to keep up with the times.  An alliance with Google, and access to insights from their deep pool of user-generated behavior (1 billion search requests a day gleans a lot of information on what’s hot or not), could help Nielsen establish a much stronger digital footprint.   Information from Google could help Nielsen build tracking services, or augment existing ones, that betters there assorted rating services from TV to music. As it stands, Nielsen has already moved to include online music in one service. And in another deal, they partnered with Sony to figure out ways to track in-game advertising. A partnership with Google could help on many levels.

Related Content:

•NBC researching Advertising in a DVR age
•Sony into In Game Advertising; already partnered with Nielsen
•Google and Echostar in TV Ad Deal
•Echostar buys Sling Media