Last week, AdNews published a story titled 'Nine not happy, dumps SMI over gap in figures', which discussed Nine pulling support from the Standard Media Index (SMI).
The story examined different media owners considering alternative reporting systems.
However, SMI's global chief executive, Sue Fennessy, has hit out at the AdNews story. See what she had to say below, or read the response to Fennessy from AdNews editor-in-chief Paul McIntyre.
Letter to the editor from Sue Fennessy:
When I first read your AdNews article 'Nine not happy, dumps SMI over gap in figures', my initial response was to craft a short letter defending our business and our data.
But it was actually the subtext of this article that I found most disturbing and which prompted me to spend time on the weekend writing a longer article in response.
We are prepared to meet criticism head on, but this article was awash with generalisations and low on fact and objectivity.
The facts are that SMI Australia has over 95% of all media agency spend, aggregating a $7.5 AUD billion Australian market pool. We have 32 clients in Australia who we have worked hard to gain and sustain, and, with the exception of Nine, have a 100% client retention rate. We are very grateful to the continued support of agency partners and media owners who believe that growth can only be enabled through access to good data.
We are not a perfect data set, no data set actually is, but it is the application of the SMI data and any other data set for that matter, that separates the growth companies of the future.
Not all clients love what the SMI data is saying every month, but generally they are smart and realise they need to have clarity to better navigate a complex landscape and they will be at a competitive disadvantage without it. We are relentless in challenging our own methodology and looking for ways to build upon the data set we have created. We constantly ask customers their thoughts on how we can better our business and remain open to discussing new methodologies. Our business is predicated on enabling the creation of data based insights that lead to better business applications and outcomes.
A clear attack on a business that is focused on innovating in a sector that desperately needs better data, technology and greater efficiency seems unnecessary if not cheap. Why would Paul McIntyre and AdNews find it important to sensationalise the loss of a client against renewal of all others, ongoing product development and benefits which are clearly for both agency (and the clients they represent) and media owner sector participants?
With all the incredible technology and digital innovation and media change in our sector, are there not enough illuminating stories for journalists to find? Why do we find it necessary to take innovative companies and try and pick holes in these businesses?
The imperfect nature of data is one reason why, historically, information has been called research and not data. Ratings, circulation, readership, user estimates, market estimates - they all have their different methodology and a different value proposition. If you look at any research around the world, there are wild swings between what numbers may say about businesses and what that business will say about themselves. That is why self-reported numbers or demand estimates are unsustainable in the trading world of the future as they will not truly reflect the real demand of any vendor. The reason that the KPMG numbers ceased some years ago (before restarting again) was that the self-reported numbers were inconsistent and could contain things like production that could skew the outcomes. I actually support industry released numbers, but believe that every methodology has its vulnerabilities.
The difference with SMI is that we are the actual market expenditure sourced from the media agency booking systems of our participating agency groups. We are not estimates. We are not research. We are actual. And we are timely. And since the SMI data is coming directly from the systems which are used to bill Advertisers and pay Media Vendors like Nine, and these systems have been running for 15 years across all Media Agency groups, it’s an odd contention that somehow these figures could not reflect the real position of the agency pool that we represent. We respect that what may be reflected in the agency system may not be exactly what is reported in the media owner systems, but surely in an ideal world you could have both.
Today’s game is about how to access and use the best data available to analyse and grow your business. Industry leaders of the future embrace data and all that it can show them. They use it in trading conversations and to support strategic business decisions. The SMI data can show industry leaders in a timely and accurate way what is actually going on.
I believe that all of us in the media data space are striving to create models that can support and sustain the sector as it evolves. And the creation of this future will involve multiple data sets. We see SMI as a key input to this timely currency across multiple markets globally. Nielsen and ComScore amongst other things, are focused on building and refining the best models for ratings and user data. A good example of this is OzTam – whilst there is strong support of the metrics and the methodology they use today, but they are also exploring how technology can be used to build more real time and accurate measures of viewer activity.
We see the SMI data as complimentary to all these other data sets and history has shown that some of the best models are built from collaboration and joint investment from a cross section of the industry. Many of us are obsessed with ways that data can actually drive this evolution. Our business partners and key stakeholders, the media agencies, are also committed to driving better metrics and technology to support and build their future. And the media owners want to maximize the commercial value of their content. And, we all need to realise that the health of one part of the sector directly affects all other stakeholders.
Ironically, where there is a challenged sector or business in the market there is an even greater need for good data to better navigate the future. And this is no longer just about examining the sector in which they operate – it is equally vital to understand what is happening in all other sectors. They potentially even need to look at the US and UK data for example to see global trends. ACP could gain value from looking at how they can reinvent their content to gain a greater slice of the 7.5 Billion dollar SMI Australian pool. They need to examine the performance of their titles and genres in Australia and other markets, and how similar content genres are performing in other media sectors such as Pay / Cable TV. An innovative leader in the out of home market in the US subscribes to the data not to look at their own data and sector strength, but to analyse genres, categories and most importantly cable television as they see cable as their primary competition and want to track a consistent cross platform path to share gains.
When we map the competitive landscape for any individual media owner, the list of vendors can often be surprising. In the global digital world in which we operate our greatest competition is not in the places we expect to see it. The SMI data shows broadcaster share, but it provides the platform for much greater insight across the whole landscape.
Sports Illustrated isn’t just competing against ESPN magazine and other sport magazine titles. They compete for dollars against ESPN, NBC Sports, out of home venues and a multitude of digital and other cable platforms. With our media clients we are now tracking these tailored competitive sets and tracking share gains against their own unique competitive sets. SMI data is the only data set that can enable this. The media owners are less obsessed with total market and interested in how to get a bigger slice of the multi Billion dollar SMI US pool. The SMI data is informing strategy and also enabling better conversations with media buyers.
The competitors of Nine Network are not the same as they were yesterday. Broadcasters are competing against each other for dollars, but they have a whole raft of new media companies in other sectors hot on their heels. Many of these companies are data savvy. All these companies in Australia are SMI customers.
We all need to stay strong, resilient and committed to the belief that the best of the media world lies ahead. We need to believe that better paradigms are within arms-reach. We live in a world where youtube was created and sold for 1.65 Billion in the space of 20 months. And rather than be inspired and energised about what is possible, many of us just get scared. When companies are fearful and under financial pressure, they start criticising anything that could potentially expose any weakness rather than looking at ways to use data to reinvent their own valuable content. In contrast to the position taken by Nine, many other customers describe the SMI data to me as “business critical”.
Importantly, it is only through real demand data that we are going to be able to build sustainable transaction platforms of the future. We cannot have fast efficient transactions if we cannot get a sense of accurate demand and are going to spend all our time debating the currency.
Innovation is a tough, often unrewarding road. But I know one thing. Unless you are brave enough to ask yourself the hard questions and experiment using the best data and resources available, you will not survive in the new, competitive digital, global world.
To stay inspired, we constantly ask ourselves questions like:
Are the old research estimates sufficient to equip us for business in the future? No
Do we have enough technology solutions in our sector to be commercially sustainable in the future? No.
Has technology enabled efficient trading in other sectors? Yes.
Have we refined the commercial models that support digital platforms and content? No
Do we need common metrics across geographic borders and sectors in order to support commercialisation of content in the future? Yes
I wonder if those at Nine or AdNews are asking themselves the same questions.
Like all innovation and change, for some the possibilities presented by new and real data sets are just too hard and too confronting. Some just want to bury their heads in the sand and for it all to go away.
The old world in media was lovely. Lots of champagne and mad men. 25 years ago I sold radio, which was one of the tougher and less prestigious media types, but the sales approach was heavy on relationships and all about the 30 second spots. Today’s conversation is different and having a good relationship is just the starting point. Success is predicated by being able to have smarter, data based conversations. And content needs to be presented in a more compelling way than just ratings or circulation and potential audience.
Enabling this needs data and it needs technology. We need to collaborate with partners, customers and competition and strive for better, faster data so that we can trade in a sustainable way in the future.
I recently watched the Hunger games and it resonated with me when the game maker said “there is only one thing more powerful than fear. And that is hope”. We have an industry frozen by fear. And scared people try and whip up fear into a storm.
When we launched SMI, we battled all sorts of criticism from the Australian marketplace, but we passionately believed that we can create more efficient, profitable global businesses through better data, technology and innovation. What gives me inspiration every day are the brave and smart media owners and agency execs who are not burying their heads in the sand, but are committed to using data to better understand their businesses and create growth. They remain confident that there are more efficient and profitable ways to do things and know that data (SMI’s and others) will help them achieve this.
Let’s make our industry strong, resilient and profitable. Let’s support innovation and embrace continued experimentation, with all its risk of failure, because that is what we all need to do in order to survive.
And most importantly, lets embrace a higher level of transparency and the evolution of new content and commercial models. It is the way of the future.
Sign up to the AdNews newsletter,
like us on Facebook
or follow us on Twitter for breaking
stories and campaigns throughout the
day.
Have something to say? Send us your
comments using the form below or contact the writer at adnews@yaffa.com.au
Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au
Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.