Nielsen Holdings PLC (NYSE:NLSN) is going through a rough patch at the moment- struggling to retain its customers. Although the company has managed to renew a couple of contracts, a good number is also dropping their services citing almost similar reasons.
Nielsen Renews contract with Stations
Nielsen has reportedly renewed its contract with the Hearst Television under which the company will provide Nielsen with audience measurements for its local and national TV and radio stations.
According to the agreement, Nielsen’s Watch Segment will track Hearst viewership data then submitting them to Hearst together with analysis. The data and analytics will enlighten Hearst on its viewership after which the station can fashion content according to viewers and listeners preference across different geographies.
Nielsen will gather electronic ratings for Hearst’s 26 local markets, fish for national ratings for its syndicated programming and 2 Baltimore-based radio stations, namely WIYY-FM and WBAL-AM.
Raycom Media has also granted Nielsen a contract extension for audience measurement of particular Raycom television stations. The new contract commencing January 2019 will have Nielsen providing local ratings and analytics services for a majority of Raycom’s LPM, SET and Code Reader markets.
The stations that will benefit from the service include, “WBTV-Charlotte, WBRC-Birmingham, WXIX-Cincinnati, WMC-Memphis, WVUE-New Orleans, WWBT/WUPV-Richmond, WFLX-West Palm Beach, WCSC-Charleston, SC, KFVS/WQWQ-Paducah-Cape Girardeau-Harrisburg, KOLD-Tucson (Sierra Vista), and WWSB-Tampa-St.Pete (Sarasota).”
Major Stations Ending contract with Nielsen
These are great news for Nielsen considering the company is on the verge of losing most of its customers. Major networks like CBS have reportedly opted out from the company’s rating services.
CBS is said to be fishing for another rating service provider ending their $100 million annual contracts. CBS is leaving on the grounds of Nielsen’s inability to provide accurate data in the multiplatform space.
Seemingly Nielsen is not keeping up with the current trends in the broadcasting industry specifically video streaming. Video streaming has become widely popular making it hard to accurately account for viewership, as a result making Nielsen lose its multimillion contract with CBS. It is reported that Nielsen is working on having its rating capabilities in the long run.
Well to add salt on the injury, Gray Television might be ditching Nielsen by the end of the year. Gray’s Vice President of National Sales expressed his dissatisfaction in Nielsen’s new methodology of harnessing ratings, and as a result, his station is also opting out.
Nielsen’s Methodology needs Urgent update
Nielsen must change its measurement methods if it has to retain or even attract new customers going forward. The company’s Watch Segment contributes about 53% of the company’s total revenue indicating that salvaging the segment is paramount if the company has to progress to newer heights not to mention retaining its position.
However, Nielsen has been updating its product portfolio to capture the market needs. The company unveiled Advanced Audience Forecasting tool providing projections of TV audiences. Additionally, Nielsen launched the Connected Partner Program enabling stations to connect with other partners in the network and accessing measurement data provided by Nielsen.
Nielsen’s deteriorating stock
With a relatively solid product line and deserting clients, Nielsen has a Zacks Ranks #3 with a mediocre (HOLD) recommendation. The company’s stock has lost nearly 36.3% of its value year-to-date and has projected a 1% decline in annual revenue this year. As of this writing, the stock closed at $23.33 up 0.30% on a volume of 2.6 million shares. The stock is off its 52-week low but still below its 50-Days and 200-Days moving an average of $25.49 and $27.61 respectively.