The long standing debate over which is the better mechanism to measure television audience, the current Cost Per Ratings Point (CPRP) or the globally more accepted Cost Per Thousand (CPT) system, recently erupted after Shashi Sinha, CEO, IPG Mediabrands India mentioned at The Advertising Club’s annual Media Review that TV buying needs to shift from CPRP to CPT as it has outlived its utility. The conversation came up for the first time after the establishment of BARC India. This definitely was met with a positive response from the broadcasters who feel it’s an ideal methodology for calculating cost benchmarks in growing markets, as it captures the incremental viewer base. One of the broadcasters we spoke last time felt it ensures fair share for the broadcaster ‘who is not shortchanged for possible loss in percentage rating points despite growth in the universe and the actual viewer base.’
It has been mentioned earlier by industry experts that broadcasters are looking to justify the increase in their prices through CPT model. It needs to be pointed out that it’s relatively easy to increase prices in the CPT model as compared to the CPRP where more weightage is given to the amount of time and stickiness of the audience. The stickiness factor is not taken into account in the CPT module.
Three years ago when the debate sprung to life experts felt that the CPT model is not rightly timed yet as they felt a need for a robust ratings mechanism to take place. Now with the arrival of BARC India is the industry ready for CPT? But then, Ashish Bhasin, Chairman and CEO of Dentsu Aegis Network South Asia pointed earlier that the quality of BARC rating needs to reach at an industry accepted level first. “Issue with BARC needs to be stabilized before any decision can be made because at the moment the variations emerging between pre and post evaluation plans are unrealistically high. This is causing a huge concern to the industry. BARC is aware of it and has set up an Industry Committee to look into it. We need to make sure the ratings that we are getting are of high quality, stable and variations if any are explainable. Once we have a proper accepted industry rating system and ramping of people’s meter is being planned then it’s the right time to open up this discussion.”
From what it’s understood the discussion is not coming to any concrete conclusion anytime soon. Dinesh Vyas, Associate Vice President (Planning) at OMD explains, “CPRP is still the currency that we would follow. Like it or not, the reason people are planning to move towards CPT is that they can negotiate a higher price because TV penetration to a certain extent is still growing. At the same rating you are reaching a much larger audience. That’s why they want to pursue CPT. So it’s a clear divided mandate at the moment. People who are selling their ware would love to sell them at CPT; people who are buying them will prefer CPRP. Unless there’s a compromise somewhere we will still follow the CPRP. But there have been times when we have also used CPT to our advantage while selling properties to client. Moving forward, there will come a time when everybody will have to follow a basic measuring unit but that can’t happen overnight. Someone who has the habit of buying a water bottle at Rs 5 will run away if you sell it to him at Rs 50.”
PM Balakrishna, CEO, Allied Media Network still hasn’t found any substantial reason to move to CPT and doesn’t think of CPRP as an archaic method as claimed by broadcasters, “How can suddenly something become old and archaic when it’s working at the moment? I don’t agree with that. Every media agency is doing calculations in what they feel is comfortable. At the end of the day, the efficiency is measured in TVR and TVT and I don’t see any major reason to move to CPT. See they are talking about changing the mathematics of it but otherwise the absolute figures remain same. Broadcasters are pushing for it because they want increased rates. It doesn’t change the dynamics of number of people, it’s just the way of representing it. I don’t see any major implication for us as far as the numbers are concerned. Today publications sell at CPT because they are talking about cost per thousand readers. If the total readership is divided by 1000 you get a CPT which is what TV wants to do. It’s a matter of working with number in a way more advantageous to them, which I don’t see planning and buying agencies are rushing to do. Media planners will wait and see what works.”
Anita Nayyar, CEO, Havas Media Group India and South Asia offers a balanced viewpoint, “This issue has been there for a long time. For media agencies what works is CPRP. If you look at the number of additional households on a regular basis then CPT does make a lot of sense. If you compare India’s CPT with other markets it’s probably the lowest. In this situation broadcasters will push for it as number of eyeballs is increasing. From planners’ perspective while there are eyeballs the rating points have been planned by agencies for television is not really on CPT basis. Currency has to be acceptable across, which is how things will move in that way. There’s nothing wrong with CPRP either after all industry has been working on it for so long. Whatever measure is taken into account, it has to be evaluated in a way that’s acceptable by broadcasters, advertisers and media planners.”