The Great GRP Debate.

Want to start a brawl in online advertising circles? Just announce that online advertising should adopt the traditional media measurement metrics of reach, frequency and GRPs (gross rating points).

This debate, in fact, has been raging for years, practically a lifetime in the Web world. But the tide seems to be turning—in favor of GRP adoption.

Certainly, those opposed to applying GRP metrics to the digital realm have their points.

Digital insiders argue that standard reach and frequency metrics fail to take into account the Internet’s unique interactive qualities. Matt Freeman, CEO of Betawave, recently declared in a March Adweek article, “It’s like going to a 3-D movie without the glasses. The Internet is more dimensional, but for the most part measurement criteria are the same as for a one-way medium. You don’t have the glasses so you’re not appreciating the dimensions.”

Others contend that reach and frequency are inadequate metrics to capture the rich engagement and viral pass-along benefits of social media and video programs.

Until recently, I sided with the anti-GRP arguments and dismissed those campaigning for GRP measurements on the Web as naive, thinking, “They just don’t get it, do they?” But I’ve changed my mind, and now support the adoption of GRPs to integrate digital within the media budgets of big brands.

What made me flip-flop? Pure logic—and some cogent cases made by people I trust and respect. In writing the recent eMarketer report, Online Brand Measurement: Connecting the Dots, I was exposed to over two dozen transcripts of interviews with industry leaders on the front lines of media planning, buying and measurement. Experts such as Young-Bean Song of the Atlas Institute (a division of Microsoft); Jim Spanfeller, CEO of Forbes.com; Pam Horan, CEO of the Online Publishers Association; Curt Hecht, president of VivaKi; Gian Fulgoni, chairman of comScore; and many others offered some articulate, compelling arguments that online should adopt GRP metrics. I can’t do these treatises justice in this limited space, but here’s the gist.

First, let’s get our definitions straight. When marketers say they want to measure online branding effectiveness, there are really two questions they want answered:

1. How successfully and efficiently did I reach my target audience?
2. Did my advertising influence the intended target’s attitudes, perceptions or behaviors associated with the brand?

The GRP metric, which is a measure of reach and frequency, gets at that first question about reach. Advertisers want to know how many people had a chance to see the brand’s message. That’s a fundamental question—no matter what the medium. In fact, it has become the currency by which traditional media is bought and sold. Reach is a simple but powerful criterion for success in marketing.

Also important, the concept of reach needs to be specific to a particular audience. Marketers want to know both how many targeted people were reached, as well as what percent that represents among the total target population. For example, I reached 20 million women ages 18 to 49, which is 25% of a total target universe of 80 million.

Compare that to online measurement today, where we typically talk of “millions of gross impressions delivered.” But does the advertiser really care if 50 million gross impressions were delivered, if no one has a clue about how many and what percent of the total desired target population was reached? The simple impression doesn’t take into account the advertiser’s true objective—to promote the brand to those most likely to buy. It also doesn’t provide a perspective on the total universe of the target group.

“The problem with the online impression, which is the closest thing to a GRP right now, is that it doesn’t have a denominator. The denominator is that universe of the people I’m trying to reach. The GRP is simply the numerator. It’s hard [online] to know how many of those impressions you served actually went to women 18 to 45.”

—Young-Bean Song, senior director of analytics and Atlas Institute, Microsoft Advertising, in an interview with eMarketer, April 16, 2009

If you, as an advertiser, can figure out how to do the appropriate math—and some advertisers and their agencies are already doing it—then you can apply GRPs to digital in a way that allows for apples-to-apples comparisons with other media. You can answer the basic question of targeted reach. You can start integrating online into the sophisticated media mix models you’ve been using for years.

“You will never see P&G and Unilever and those guys spend online unless we give them reach, frequency and GRPs. Their entire business model is based on that.”

—Young-Bean Song

Currently, only 12% of senior marketers say they always integrate ad performance data across media channels, according to a study by TNS and Eyeblaster. By applying GRPs to online, though, this figure will grow and online will start to get its proper place at the media table.

Frequency with Which Marketers Worldwide* Measure Digital Cross-Channel Performance Data, March 2009 (% of respondents)

Need more proof as to why GRPs should be folded into online metrics?

Consider what Ms. Horan of the OPA said in an interview with eMarketer: “At the end of the day, we ultimately need a standard.…We need a metric that will allow marketers to mix and match and to allocate dollars across whatever the platform is, something that’s interchangeable between all media.”

Or Mr. Fulgoni of comScore: “I think one would be crazy not to use GRPs. They tell you how many times you reach the person with an ad, and how many people you’re reaching. I mean if you don’t have that, I don’t see how you can really understand the intricacies of your media plan or compare it across media.”

To reiterate, I’m not advocating that GRPs become the only metric used online, but rather that GRPs be included in the mix with other measurements that capture brand engagement, attitudes and perceptions.

By Geoff Ramsey

Geoffrey Ramsey is CEO and co-founder of eMarketer. He can be found on Facebook, LinkedIn, Twitter and at an industry marketing conference near you.

Courtesy of http://www.emarketer.com