SAARF’s Role in Media Audience SAARF’s Role in Media Audience ResearchResearch

Presentation to AGM4 May 2006

(Discussion Document)

Introduction

"The wireless music box has no imaginable commercial value.

Who would pay for a message sent to nobody in particular?"

• David Sarnoff's associates in response to his urgings for investment in the radio in the 1920s.

The recent history

• PMSA September 2002 – Discontent in Spring

• A summit of all stakeholders took place on 31 October 2002 and mandated a working group, chaired by John Little, to review the functioning of MIT and the deliverables of its beneficiaries:– SAARF– ASA– FOCST

• The working group decided to conduct its work through five task teams

• The working group reported back to a summit held on 20 August 2003

The recent history

• Project Team 1 Industry Research (Convener: Mike Nussey)– Establish the research needs of the industry, optimal research methodology and

cost/value benefits

• Project Team 2 Self Regulation (Convener: John Little)– Review the industry’s self regulatory needs and cost implications

• Project Team 3 Other beneficiaries (Convener: Howard Gabriels)– Evaluate the need to support financially any other industry organisations

• Project Team 4 Funding model (Convener: Brian Potinger)– Develop an appropriate funding model and consider the merits of an

industry forum

• Project Team 5 Governance (Convener: Howard Gabriels)– Establish agreed governance principles for beneficiary bodies and develop a

migration strategy from MIT to the new funding model/institution

The recent history

• Project Team One – the members

Nina de Klerk ACAHoward Gabriels MFSANick Holdsworth PMSALes Holley OHMSARoss Jennings MFSALudi Koekemoer ACAAnina Maree SABCBrian McMillan etvMike Nussey AMFThomas Oosthuizen IndependentTracy Stafford NAB Brenda Wortley AMF

The recent history

• We looked at 63 surveys in 51 countries

• Joint Industry Committees 38 60,3%

• Research companies 18 28.6%

• Media Owners 7 11.1%

63 100.0%

• We agreed the merits of joint industry research taking into account different requirements.

• We should preserve technical experience and learnings that have been gained by SAARF over the years.

The recent history

• Principles That Guided Our Thinking:– The principle of a centralized, industry-wide clearing

house to manage, run and mediate industry research requirements was agreed.

– Allowing for a common base survey with individual media types/client data linked on in a modular way (omnibus concept).

– All modules must be designed so that fusion between modules can take place.

– High level involvement by senior members representing key stakeholders is a prerequisite.

The recent history

MarketersAgencies

TV Print Radio Outdoor Cinema Other media/stakeholder

Assessment of RequirementsCommonalities/differences What is extensively used

Base SurveyDemos/Coverage/Profile/National Sample

Modular surveys by medium/stakeholder1) What the media owners and clients agree should

be included in the common fee2) What stakeholders/companies pay for themselves –

outside of the common feeTVCommonPortion

Media OwnerPortion

RadioCommonPortion

Media OwnerPortion

PrintCommonPortion

Media OwnerPortion

OutdoorCommonPortion

Media OwnerPortion

CinemaCommonPortion

Media OwnerPortion

MarketersCommonPortion

IndividualCompanyPortion

NegotiationMarketers and media owners

Industry Structure

MASTER AGREEMENTAll Stakeholders

INDUSTY WIDE FORUM STAKEHOLDERS

(AMO Stakeholders)

PMSA ACA AMF MFSA Cinemark NAB OHMSA OPA SABC

ALL PRINT(PMSA)

LEVY COLLECTION AGENCYMFSA / ACA / AMF / AMO STAKEHOLDERS

BENEFICIARY ORGNAISATIONSSAARF / ASA

SAARF’s mandate

• The main object of the Company is:

• To provide tools for targeting and segmentation of markets as well as to establish, commission and manage comprehensive, valid, reliable, continuous media audience and product usage research, surveys, investigations and reports, that provide comparable multi-media and multi-product/brand usage information that reflect the totality and complexity of the South African society.

– SAARF MEMORANDUM OF ASSOCIATION ADOPTED IN 2004

SAARF’s mandate

• SAARF is an independent authority, acting as the custodian of the currency on which we buy and sell media and advertising space and a clearinghouse for industry research.

Objectives of SAARF

• Facilitating, co-ordinating and determining the joint industry research needs of its stakeholders.

• To ensure that these needs are met within the limitations of the funding available for this activity.

• To keep track of local and international developments, ensuring that new approaches are explored and developed, and that the necessary joint industry research programs, which accurately reflect South African society, are implemented, managed, and monitored.

• To provide tools for targeting and segmentation of markets.

• To establish, commission and manage comprehensive, valid, reliable, continuous media audience and product usage research, surveys, investigations and reports, that provide comparable multi-media and multi-product/brand usage information that reflect the totality and complexity of the South African society.

Objectives of SAARF

• To co-ordinate joint industry research amongst the advertising, marketing and media industries.

• To investigate any research techniques whether in practice or proposed and to establish the degree of validity and reliability of the results obtained thereby; to seek improved methods in media audience and product usage research and to provide improved tools for targeting and segmentation of markets

• To act as a liaison between the advertising, marketing and media industry and universities, government and other official bodies involved in any form of education or research related to media audience, demographic and product usage research as well as tools for targeting and segmentation of markets.

• To arrange seminars and courses directly or indirectly sponsored by the South African Advertising Research Foundation on any or all aspects of advertising, media or market research as well as tools for targeting and segmentation of markets.

• To act as mouthpiece of the industry on matters pertaining to media audience and product usage research as well as tools for targeting and segmentation of markets.

Objectives of SAARF

• To promote and maintain fair, reasonable and proper standards of media audience and product usage research as well as for tools for targeting and segmentation of markets.

• To maintain and augment a library containing information concerning media audience, product usage, and related research as well as on tools for targeting and segmentation of markets, and to make it accessible to members, students and the general public.

• To do all such other acts, including the publication in print or electronic format, of books, memoranda, journals, magazines, circulars, reports and any documents or databases as the South African Advertising Research Foundation may consider expedient to promote the interests of members.

• Likewise to do all things and carry on any activity related, connected or associated with any of the above objects and purposes.

• To finance the operations of the Company by engaging in any lawful activity which may generate funding for the Company.

Guiding Principles of LCA

• Principle 1: – Beneficiaries Of The LCA Should Be Organizations Serving The

Whole Industry.

• Principle 2: – The Boards Of The Beneficiary Bodies Must Decide What The

Industry’s Needs Are In Their Areas Of Expertise

• Principle 3: – Close Cooperation Must Exist Between The LCA And The Boards

Of Beneficiary Organizations

• Principle 4: – The method of funding must be fair towards all stakeholders

The governance issue

• Following on the recommendations of the Industry Working Group, the SAARF Board appointed a SAARF Governance Task Team

• This Task Team met 6 times over a period of about 4 months before it made its final report to the Board.

• Some of the important points that came out of these deliberations were:– The importance of the SAARF surveys for target marketing.– Access to the currency mustn’t be limited. SAARF must protect the

currency but must give access to anyone who needs it. – The analogy that the Reserve Bank does not allow anyone to print

money but everyone must have access to printed money was mentioned.

The governance issue

• Subjects addressed by SAARF Governance Task Team – The Functions, Structure and Functioning of SAARF– Size and composition of SAARF Board– Sub-committees of the SAARF Board– Drafting of a new Memorandum of Association– Drafting of new Articles of Association– Dispute Resolution (included in the articles of

association)– The possibility of changing the name of SAARF– Representation of SAARF Board members on Boards

of Funding organizations

The governance issue

• The new Memorandum of Association as well as the new Articles of Association of SAARF were adopted on May 2004, giving SAARF a fresh new mandate and clarifying its future direction.

• But still it was not over:

• The Governance task team also recommended that the full SAARF Board must meet as soon as possible for a 1 day workshop to look at future strategy

The SAARF Tender process

• The SAARF Tender Committee worked on the following 5 Tenders:– SAARF All Media and Products Survey (AMPS®) – SAARF Products and Brands, Interests and Activities (Life Styles) Self-

completion Survey– SAARF Electronic Measurement of Outdoor Advertising Survey (SAARF OMS)– SAARF Tender for Data Integration of two or more surveys by using fusion or

other techniques across all SAARF products such as AMPS, TAMS, RAMS, SAARF OMS, etc.

– SAARF Radio Audience Measurement Survey (RAMS®)

• Key objective of the tender committee was to spread the net in terms of suppliers.

• The tender committee decided to award the AMPS, RAMS and self-completion tenders jointly to Shonigani and African Response.

Summary of SAARF Research

YEAR RAMS® AMPS® Comments

1999 4 Diaries 2 AMPS® • Strategy 2001 fully implemented (Except for psychograpics)• Plus Teen RAMS® • Plus Child AMPS® and RAMS®

2000 3 Diaries 2 AMPS® • Review of SAARF and all its products.• Preparatory work for change to 12 month rolling data for

AMPS® and RAMS® and expansion of TAMS® panel

2001 2 Diaries 2 AMPS® • FMCG done as a self-completion questionnaire• Only one 6-month diary during 2nd half of year in preparation

for the new improved RAMS® which was fully implemented with the publication of results in August 2001

• TAMS® panel modernised and enlarged

2002 2 Diaries 2 AMPS® •6-monthly reporting on a rolling 12-month sample for both AMPS® and RAMS® as the industry currency.•TAMS® moving towards final level of 1 356 reporting homes with the help of additional funding by the TV media owners.•Outdoor pilot study.•Introduction of SAARF Branded data as a user-pay service on AMPS® 2002B.

2003 2 Diaries 2 AMPS ® •Reduced sample for AMPS® and RAMS®•Drastic shortening of AMPS® questionnaire•Last Outdoor study using Copland model•TAMS® at a final level of just over 1 300 reporting homes

Summary of SAARF Research

YEAR RAMS® AMPS® Comments

2004 6 Diaries 1 AMPS® • Sample size for AMPS® 2004 survey approximately 12 000. Currency still 12 month rolling data (AMPS 2003B plus AMPS 2004)

• AMPS® questionnaire similar to 2003B• RAMS® sample up to approximately 41 000 diaries due to

introduction of flooding• TAMS® at a final level of 1 356 reporting homes

Some of the achievements

• Participation in the Transformation debate

• Transformation of the Board of Directors

• The award of the tender to Shonigani and African Response

• The introduction of AMPS on the base research model

• The introduction of the new RAMS reporting 6 times a year

• The introduction of overnight ratings in TAMS

• Participation in the outdoor pilot in South Africa and Chicago

• Extending Branded AMPS and making it freely available

• The growth of PAMRO and the development of JIC on the African continent

Way forward

• We agreed the merits of joint industry research taking into account the different requirements, of the advertising, marketing and media industries.

• We need to preserve the technical experience and learnings that have been gained by SAARF over the years and further strengthen local media audience and products/brands research expertise.

• The importance of SAARF surveys for target marketing is indisputable – thus the provision of data and tools for targeting and segmentation of markets must continue.

• Access to multi-media and multi-product/brand currency by all SAARF stakeholders must be unlimited.

• SAARF’s most basic task is to give access to the currency to all stakeholders.

Special thank you’s

• Board of Directors

• The stakeholders – The Marketers– PMSA– NAB (TV & Radio)– OHMSA– ACA– AMF

• The Staff of SAARF