Judgement Day For Nielsen
Yesterday Facebook stole all the headlines on Wall Street with the biggest single day market cap drop in the history of the world. Almost lost in FB’s shadow was even a worse day for the measurer of all things media . . . Nielsen. During yesterday’s Q2 Earnings call Nielsen lowered its revenue guidance for the remainder of 2018, and also announced that its CEO Mitch Barnes would be leaving the company later this year. The double whammy plummeted Nielsen’s stock 25%, which reduced the company’s valuation by $2.8M.
So why such a drastic reaction by Wall Street? My guess is the light bulb finally went on for many investors that Nielsen has been cruising along in a comfort zone for the better part of the past decade with near-monopolies on media and consumer goods consumption measurement. They haven’t had to innovate since nobody else was threatening them, so they didn’t. Now Nielsen finds itself behind the measurement curve with digital media (streaming audio . . . hello?!?), their CPG measurement business is overpriced and cumbersome, and I’m not even sure they know what the term proximity attribution means.
Nielsen’s predicament reminds me of a line from the Pink Floyd song “Dogs”, when David Gilmour sings about it “being too late to lose the weight you used to need to throw around.” Maybe that’s why Nielsen now finds itself in Wall Street’s dog house? (sorry, I couldn’t resist 🙂 )