How Do TV Ratings Work?

The future of your favorite TV shows hinges on their ratings – but what is a rating, and where does it come from?

Learn more about your ad-choices at https://www.iheartpodcastnetwork.com

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:02):
Welcome to brain Stuff from How Stuff Works. Hey, brain Stuff,
it's me Christian Seger. We have all heard about TV ratings.
They're just an estimate of how many people are watching
a particular show at a given time, and they are
a big deal. As of people in the US watched

(00:23):
about thirty four hours of TV each week, Billions of
AD dollars hang in the balance, and if a show
doesn't perform, then it risks getting axed. We're all familiar
with it. More than a few fans have been disappointed
when low ratings doom their favorite shows to cancelation. And
without naming any names, it's fair to say that some

(00:44):
viewers are surprised when shows they hate continue through season
after season after season due to high ratings. But what
are these ratings anyways, where do they come from, and
why are they so important? Well, in the United States
and Canada, TV ratings are synonymous with one company, Nielsen,
which was founded in nineteen twenty three by an engineer

(01:07):
named Arthur Nielsen. Originally, he wanted to sell engineering performance surveys,
a way to measure the efficiency and quality of engineering operations.
By ninety two, Nielsen expanded, creating a retail index that
tracked purchases in the food and drug markets. This was
the first successful attempt to measure these markets on a

(01:28):
wide scale, and by nineteen fifty the company applied this
technique to a little industry called television. Today, Nielsen measures
the number of people watching television shows and makes its
data available to cable networks as well as advertisers and
the media. The company uses a technique called statistical sampling

(01:49):
to rate the shows. This is the same technique that
polsters used to predict the outcomes of elections. Nielsen creates
a sample audience and counts how many people in that
audience view you each program. They extrapolate from the sample
and estimate the number of viewers in the entire population
watching the show to find out who's watching what. The

(02:10):
company gets thousands of households to become part of the
representative sample for the national ratings estimates. These participants are
randomly selected, and they're paid a little bit but not
near enough to you know, quit their day jobs and
watch TV full time. Every US household with a TV
theoretically has a chance to be a part of the sample,

(02:32):
but the sample itself is not very large. I mean,
that's just a few thousand households extrapolated to represent millions
right well. To make up for this, the company measures TVs, homes, programs,
and people in a variety of ways. The data is
broken down by demographic, type of stream, and so on.

(02:53):
This representative sample is compared to the general population, and
Nielsen also calls thousands of household to see if their
TV sets are on and who is watching. But the
phone survey could happen to anyone fitting the criteria, and
it could also be a one time thing. So what
about the genuine Nielsen families, you know, the one Nielsen

(03:14):
monitors continually. Well. To find out what these people are watching,
the company installs a black box on the TVs in
a home. This isn't the same as a black box
on a plane. No, it's just a computer and a modem.
The box keeps track of when the TV is on
and what it's tuned to. Every night, the box gathers
up the households viewing data and sends all of this

(03:37):
information to the company's central computer. By monitoring what is
on TV at any given time, the company is able
to keep track of how many people watch, which program
that seems fine, but how do we know who is
watching what? Well, after all, not everyone in a household
is going to love the same shows. That's where the

(03:58):
people meters come in. These are small boxes placed near
the TV sets of those in the national sample. They
measure who is watching by giving each member of the
household a button to turn on and off to show
when he or she begins and ends viewing. This information
is also collected each night. The national TV ratings have

(04:19):
relied on these meters for years. To ensure reasonably accurate results,
the company uses audits and quality checks. They also regularly
compare the ratings they get from different samples and measurement methods. So,
for example, a one point oh Nielsen rating indicates that
one percent of the one hundred and fifteen point nine

(04:40):
million estimated TV watching households tuned into a program. The
data is also broken off into different demographic ratings, the
most important being people ages eighteen to thirty four. Now,
make no mistake, this research is worth billions of dollars.
Advertising rates are based on Nielsen's data. That's why a

(05:00):
thirty second commercial on one show might cost twice as
much as a commercial on a low rated show programmers
also use Nielsen's data to decide which shows to keep
and which to cancel. A show that has several million
viewers may seem popular to us, but a network may
need millions more watching that program to make it a

(05:21):
financial success. That's why some shows with loyal following still
get canceled. Sorry, Firefly, and there's an elephant in the
room here too. The way people watch TV is changing.
With DVRs, Netflix and other streaming services, TV viewers are
more likely to customize their viewing habits, watching stuff when

(05:42):
they want to see it, rather than when it happens
to be on Nielsen has ways of measuring some of this,
but not all of it. As viewing habits continue to
fragment across different platforms, advertisers, content creators, and audience members
alike are right to ask how accurate these ratings actually are.

(06:07):
Check out the brainstuff channel on YouTube, and for more
on this and thousands of other topics, visit how stuff
works dot com.