Why the online industry needs UKOM
Louise Ainsworth, managing director, EMEA, Nielsen Online, on why the online industry needs its own planning currency, UKOM.
In 2005, display advertising accounted for one quarter of online ad spend, in the first half of 2009 it had dropped to 18%, falling behind classifieds. The figures from the IAB/PWC study show that while the amount of money spent on display has increased in that period it has lagged far behind the growth seen in both classifieds and search.
Display as a medium simply isn’t where it should be. The increasing amount of time people spend surfing the web isn’t being reflected in how much advertisers are willing to spend to target them whilst they’re doing it. Search accounts for almost two-thirds of ad revenue coming to online yet accounts for less than five percent of people’s time online. Of course, searchers can be considered a higher premium as they’re in a ‘requesting’ frame of mind but this ratio is too out of kilter.
Part of the success of search is that advertisers know pretty much what they’re getting for every pound they spend. One of the major reasons, if not the reason, why advertisers have been reluctant to commit spend to display has been the uncertainty around how many people they’ll reach with a given online campaign. Depending on who they turn to, advertisers will be given a conflicting array of numbers from third-party providers and the publisher’s own internal figures – a type of measurement ‘wild west’ as some have said.
In October 2008, at the Joint Industry Committee for Internet Measurement Systems (JICIMS) stakeholder summit, 80 decision-makers from media, agency and advertiser companies came together to gauge the need for a single online planning currency. Almost 90 percent said a unified industry planning currency would lead to increased spending online by brand advertisers.
Since then, JICIMS has become UKOM but the goal has remained the same. Simply put, UKOM is a BARB or RAJAR for online. It is a planning currency designed by the industry and where the industry has governance over both the online audience numbers provided and the methodology used to calculate those numbers. Industry-generated accuracy, if you will.
These recognised and industry-agreed numbers will reduce confusion in the market and build trust, giving agencies confidence in the numbers on which they are basing their planning decisions – just as they have in BARB for TV planning and in RAJAR for radio planning. This confidence will attract more above-the-line brand advertising into a medium that has, so far, grown through direct and search.
However, the benefits of UKOM go beyond the fact that, for the first time in the UK, agencies will be able to confidently plan online campaigns that target specific audiences, using an industry-approved system, just as they currently do with traditional media. It fundamentally improves an agency’s ability to plan cross-media campaigns successfully.
This is because UKOM brings the web in line with TV, radio and print by providing agreed and comparable metrics on reach and frequency so the online component of a campaign can be planned confidently on the same level as traditional media. This is crucial in helping ensure that an online display component is put into a brand’s media plan and ensures the right websites make up the online component.
In addition to reach and frequency, the Nielsen UKOM dataset will provide unparalleled accuracy on time-spent measurement, allowing advertisers to confidently plan not only on the basis of impressions but also actual exposure and engagement. This will help media and clients take a step towards assigning true value to inventory and encourage the development of more engaging formats that are more effective for building brands online.
UKOM isn’t the magic bullet that will solve all display’s problems. However, it is a crucial building block on the path to ensure that there is much more parity between the consumption of online media and the level of display advertising undertaken to tap into it.