What Is the Nielsen Corporation?

The Nielsen Corporation is a global provider of market research and analyses of media and viewer interactions. Nielsen attempts to provide its clients with valuable insights into consumer behavior and marketing information. The company accomplishes this through data collection and measurement methods that evaluate what consumers watch and what they buy. The company is best known for its Nielsen ratings, which measures the audiences for television, radio, and newspapers in media markets.

Key Takeaways

  • The Nielsen Corporation is a global marketing research firm.
  • Nielsen attempts to provide its clients with valuable insights into consumer behavior and marketing information by collecting data that measures what consumers watch and what they buy.
  • The company is best known for its Nielsen ratings, which measures the audiences for television, radio. and newspapers in media markets.

Understanding the Nielsen Corporation

The company was founded by Arthur C. Nielsen Sr. in 1923 and was incorporated in 1929. Its worldwide headquartered are located in New York City. Investors and companies use Nielsen's ratings to predict consumer trends. Nielsen's ratings are also used by other industries including television, radio, consumer packaged goods and retail, advertising agencies, internet companies, music, video games, and sports.

In the 1920s, the company began providing analysis of brand-based advertising. In the 1930s, the company extended its analysis to the radio market. In 1947, it had expanded its reporting on the radio market to include the total audience, average audience, cumulative audience, and homes per dollar spent for time and talent for the top 20 radio shows. In 1950, Nielsen extended its ratings to the television industry using the same techniques that it had used for evaluating radio programming. Nielsen's methodology is now the standard way to evaluate television audiences around the world.

Through its market research tool, Homescan, Nielsen also measures the shopping and media behavior of millions of consumers around the world. By tracking all retail and grocery store purchases by consumers, the company's tool allows researchers to link purchasing habits to household demographic data.

In 2005, the company began its Media Voice Panel (MVP) program. For this program, they asked panel members to carry around an electric device that collected station and program identification codes embedded within radio and television broadcasts they encountered. At the end of the day, the monitoring device was placed in a cradle that downloaded and transmitted the collected data back to Nielsen. This application was one of the first of its kind.