Nielsen to Measure Digital Ads in Partnership With Tencent

Nielsen NV announced on Wednesday that it is partnering with Tencent Holdings to measure its digital audience in a move that could direct more ad dollars from companies in the United States to China's biggest social network.

Nielsen said it is launching its Digital Ad Ratings, which tracks unique users, reach and frequency of a digital ad across computers, tablets and smartphones for the first time in China.

Comscore, which offers a similar service and competes with Nielsen, said it is already available in China.

The online gaming company Tencent, which also operates the popular mobile messaging app WeChat with 500 million monthly active users, has been making a big push to increase its advertising revenue especially through mobile.

"Until now there has been no independent, reliable rating currency by which to measure digital and mobile advertising," SY Lau, a senior executive vice president at Tencent, said in a statement.

Digital measurement is one of the tools used by advertisers to help plan campaigns and shed light on how well an ad does. It is a major factor in determining the cost of an ad.

"It's something that we have been waiting for," Anthony Ho, marketing director of media at Mondelez said in a statement. "It will make our advertising much more efficient."

Nielsen will measure an ad campaign in a combination of surveys, consisting of 46,000 Chinese consumers, and aggregated, anonymous data from Tencent's hundreds of millions of active users.

Pivotal Research Group Senior Research Analyst Brian Wieser wrote in a note in May that "Nielsen's campaign measurement tools continue to dominate the preferences of the largest brands, likely capturing a greater share of spending."

The company collaborated with publishers and advertisers in China when launching Digital Ad Ratings in the country, according to Megan Clarken, a Nielsen executive vice president of Global Watch Product Leadership. It plans to roll out the service to other companies in China.

Excluding Hong Kong, advertisers are expected to spend $31 billion on digital ads this year, according to research firm eMarketer.

Tencent, which has a market value of $190 billion and reported first-quarter online advertising revenue of $438.41 million competes with Alibaba and Baidu Inc.

© Thomson Reuters 2015