Industry Insider: TV Ratings Terminology and Measurements Part One

TV advertising is still a popular form of media. But, how do media buyers evaluate which programs to select? Ratings, shares, and demographics are major factors in that decision. Nielson is the service that most broadcast stations subscribe to and that agencies use. In part one of this blog, we’ll be discussing what these measurements mean and how to apply them.

Let’s start by looking at the Baltimore market and how measurement data is obtained:

Baltimore is ranked as the 26th largest TV market, with roughly 1.1 million TV households. Baltimore is a “metered market”, meaning People Meters are used to capture viewing and provide measurements of who is watching what stations/programs and when. 
A People Meter is an audience measurement tool used to measure the viewing habits of TV and cable audiences. It’s an electronic metering device attached to a TV set to track who is watching. Household members and their guests push buttons to identify themselves.

Common TV Ratings Terminology:

Rating – The estimated percent of households (or persons) watching a program out of the universe of households who own a TV (all possible TV households). So if Baltimore has 1.1 million TV households, it’s a percent of that total TV population. 
Example: If "Channel 6 News at 6:00" has a household audience rating of 15, this means that Nielsen has estimated that 15% of the market's household audience is watching it. 
Share (of Audience) – The percent of households (or persons) watching television who are tuned to a specific program, station or network in a specific area at a specific time. Rather than a percentage of the whole TV-owning population, share only counts people who are watching TV at the time of a show's original airing. 
Share is basically a rudimentary way of accounting for people's tendency to watch TV in a given timeslot. A 2.0 rating is a very different thing in primetime than it is in the middle of the day when viewing levels are much lower, and share helps to account for this difference.
Example: If "Channel 6 News at 6:00" has a market share of 30, this means that 30% of the homes watching TV at 6 o'clock are watching that newscast.
Viewing Levels - The denominator of the share calculation is how many people are watching TV in a given timeslot. This number is important when judging a show's share; the acceptable share level is smaller in a slot when there's less tendency to view TV. Viewing levels can also be called "HUT" (Households Using TV), "PUT" (Persons Using TV) or "PVT" (Persons Viewing TV).
Demographics (Demos) – Audience breakdown based on various characteristics such as age and gender. Adults 25-54, Men 18-34 are common demos.
To find out how the industry is beginning to measure streaming services, stay tuned for part two (click here to read part two)!
Sources: Nielson