Nielsen Malaysia is changing the way it does business

NIELSEN Malaysia is changing. The country's leading market research company is becoming more proactive and plans to offer more globally-proven products.

This may well be something that the advertising industry has been longing to hear, for the industry relies heavily on Nielsen for media-related data − from newspaper readership figures to TV programme ratings.

Richard Hall, who was appointed Nielsen Malaysia managing director in May last year, says the company needs to be more of a catalyst in some of the new technology/product discussions with industry players.

“In the past, I think we had been more reactive, and that's fine. I see now that we probably have a role to play in terms of being more proactive and getting more feedback from clients,” he says in his first interview with StarBizWeek since his current appointment.

Hall took over the helm from Kow Kuan Hua, who has been promoted to marketing effectiveness leader for South-East Asia. Except for a year in Shanghai, the Englishman has been based in Malaysia since 2003, mainly in regional Nielsen roles.

Today he oversees both the “Buy” (customised and retail measurement research) and “Watch” (media measurement research) businesses of Nielsen Malaysia. The Buy business is larger than the Watch business, but it is the Watch business that seems to attract close scrutiny.

Among others, there has been a continuing call to have more accurate data on advertising expenditure (adex). Nielsen Malaysia currently measures the country's adex mainly using official rate cards of media owners, which do not show discounts.

Hall says that in a few markets, Nielsen does cover net ad spending but this requires collaboration across the industry.

“The industry has to be ready to be able to share the different discounts for us to go and track that. The other way of doing this is to agree on, say, the standard discounts for a big client for TV and we can apply that to the rate cards that we have,” he says.

It has been “some time” since Nielsen talked to the industry about it, and Hall feels it is time to reopen the discussion.

“Are we now at a stage where the industry is more comfortable sharing that information? Obviously we'll make sure there's a level of confidentiality there so we don't reveal specific companies' discounts.

“I think there's an interest for clients to get a better read. As long as they see the benefits are greater than the risks, they'll be interested. And it's up to us to go to them and say we can actually do this; we can potentially convince them. We need to showcase what we're doing in other markets.”

Going McDonald's way

Nielsen Malaysia, which has appointed Ben Ting as the new leader for Watch, will reassess what clients want.

What consumers are doing in terms of media are changing rapidly and Nielsen needs to change with it, says Hall. Fortunately, it has various products that it can lift from the Nielsen global network (Nielsen has presence in some 100 countries) to address the changes.

Over the next few months, he says, the company will build a plan for the next two to five years in terms of what it can do to meet the changing nature of its business.

An example of the changes is the viewership of TV content across different screens. Nielsen Malaysia can, if the clients want, bring here the cross-screen viewership developments that Nielsen is doing in the United States.

Hall says in the last two years, Nielsen has seen a “big change” in how it operates.

“In the past we would have local solutions so each market will have a slightly different solution to the same problem. We now have globally proven products which we can lift and place into different countries, We know exactly how the products work and global clients know what they buy in Country X is the same as what they buy in Country Y.”

Doesn't that sound a bit like McDonald's?

“It is, to a certain extent,” he replies. “What clients want is consistency in terms of standard, accuracy and what we do as a business, so we're more and more taking on that approach.”

However, Hall says it will have to adapt the product to meet the local market, and may never launch some products in the market because they're not suitable or clients are not interested in buying.

“But we will try to get the best products out there in terms of quality, speed, consistency and accuracy by adopting a standard product across markets. And that's across the whole of our business.”

Nielsen, which is headquartered in both the United States and the Netherlands, is in the midst of buying radio ratings firm Arbitron for US$1.3bil.

Hall says this is a really positive move, as Arbitron has the technology to track more accurately what people listen to and what screens people watch by.

“Malaysia is a big radio market. We need to consult the clients to say this is what we can do, and go back (to headquarters) to justify the case based on what revenue we can generate, and then we're good to go. It shows quite a different view of what Nielsen is. We are becoming far more innovative in the way we go forward and tackle the changing nature of consumers and use technology to do that.”

On the calls to improve its measurement of Internet adex, he says Nielsen does have an Internet product globally but is prioritising markets where it will introduce it in. “At the moment, Malaysia is not one. But it's up to us and our clients to make that case back to the global team,” Hall says.

Will it add more websites to represent Internet adex? Hall says he does not think it is feasible to do that at present.

Asked whether it is developing a mobile product, he says it is launching an app that sits in the phone that monitors which applications the owner uses in the phone and the amount of time spent on talking, texting and playing games.

The company is recruiting for the panel of respondents now and the first set of results will be out later this year.

Neuroscience in marketing

On the Buy business, Hall says two new products will contribute much to Nielsen Malaysia's revenue growth this year: Trade Dimensions and NeuroFocus.

Trade Dimensions, which is a revamped product available since last December, allows manufacturers and retailers to look at a digital map of all urban-area retail stores within a certain radius. Nielsen Malaysia geo-coded a map of every retail store in urban Malaysia (100,000 plus stores).

“Manufacturers will know where they should be stocking their products and increase distribution, while retailers can find out where their competition is and where is the best spot to open their future stores,” Hall says.

In 2011 Nielsen acquired 100% of California-headquartered neuromarketing firm NeuroFocus Inc, which does neurological testing for consumer research.

In November last year Nielsen's Malaysian office launched the neurological research product, which measures consumers' reactions to different types of input through their self-conscious.

“This is where we put a cap on their head and read their brainwaves. Then, for example, you can flash specific words such as exciting or tradition in front of them words linked to different brand attributes and afterwards play an advert or show a logo. You would then repeat the same words, and see how different the subconscious brain waves have actually reacted to that messaging that has come through,” he says.

This allows the agency and marketer to know whether the ad makes people see the brand as more trusted.

Besides TV ads, one can also use it for print ads and new packaging.

“For TV ads, we can reduce the duration of a TV ad from 30 seconds to 15 or 20 seconds, and probably it would have more impact. You can cut out the non-impactful parts. This applies to content of TV shows as well. Are viewers identifying with that particular character, or do they like the new news reader? A news reader can be very engaging from a financial reporting point of view, but if the person does sport, she may not engage at all. So it's very smart and very interesting.”

According to Hall, there is a huge amount of client interest in this product.

He cannot comment on financial numbers or projections without the headquarters' approval, but says that last year was a mixed year for the market research industry.

“If you look at the more international clients that we have, especially in the FMCG (fast-moving consumer goods) and CPG (consumer packaged goods) area, they were having a tough year in Europe and the US, and a lot of them were contracting budgets. We tend to reflect how our clients are doing.

“We stayed level (in FMCG/CPG); we were pretty good. But I'd say the other three big areas we work in − finance, telecom, and technology − we saw pretty strong growth.”

Last year Nielsen Malaysia was involved in consolidation and internal reorganisation. “We're now seeing the benefits of that coming through,” Hall says.

Hall may not be able to give revenue projections, but it all seems to point to a good year for Nielsen Malaysia.