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PPM Could Increase Revenue $414 Mil.

The radio industry could gain $414 million a year, a three percent increase in revenue, if it switches from Arbitron’s 40-year-old diary-based ratings system to its portable people meter (PPM), Mediaweek reports. Furthermore, if the industry doesn’t make the move, revenue could decrease annually by $282 million.

Forrester Research’s economic impact study of PPMs surveyed 484 local, regional and national agency and advertisers executives about how PPMs would change business. Nearly 25 percent of respondents would increase radio spending if a PPM ratings service were adopted.

 

 

Eighteen percent of agency respondents and 13 percent of advertiser respondents would allocate more dollars in markets measured by PPM.

If previous tests of the PPM hold true, one major change would be spending by daypart: ratings for morning drive decrease on average about 10 to 20 percent, but weekends and evenings increase.

Arbitron is currently fielding its second PPM market trial in Houston.