How do television ratings work? Are they just the percentage of viewers?
There are two different ways Nielsen ratings are generated. Larger markets (Chicago, New York, even Tulsa) are considered metered markets. These are set-top boxes that measure exactly which channel you are watching and at what time.
Unmetered markets use paper mailers four times a year (the sweeps period) and ask respondents to write down what they were watching and when, along with the demographics of the people in the household. With metered markets, it’s simply an educated guess as to which person in the home is watching as well as their age and gender.
This is important to know because you’ll often see programs and newscasts say “#1 most watched 10pm news!” This often includes a subscript that says “among A25–54” – which as you can tell from the methodology above, is mostly guesswork.
Demographics are important because companies buy advertising based on ratings. A for-profit college will want to reach a different group of people than a funeral home. Ratings are an attempt to convince companies that a certain program has a lot of their “target audience” watching, so it is valuable to buy advertising within that time.
Now, to get to the heart of your question, one rating point is equivalent to one percent of the total population in the market. You were very correct in that regard. Shares, however, are the percentage of households watching a program during a certain time period divided by the total number of households actively viewing any program at that time. We often like to use this number as it gives us a better picture of which station is “winning” a particular time period or daypart.
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