Sunday, August 28, 2005

Top TV markets vs. metro populations

So the Nielsen Media Research recently announced that Houston has displaced Detroit as the tenth largest TV market in the country. Kuffner comments here, and you can find the complete list here (press release).

I found it interesting that, while we're the 8th largest metro, we only make #10 in the TV markets (and no, I don't think it's because we watch less TV than the rest of the country, although that might be nice). In the TV listings, Atlanta, San Francisco, and Boston move ahead of us while Miami-FtL drops from #6 to #17 (because Nielsen peels off West Palm Beach separately). Part of the discrepancy is just different metro definitions between Nielson and the Census Bureau (like including San Jose with SF or not), but I think demographics figure into it too. Nielsen is looking at "TV households", while the Census is looking at people. Houston has a large Latino population, which tend to have larger households. This gives us a high population count, but a lower household count. This could also be a factor in Miami's big ranking drop.

Another interesting difference is that Nielson will look at the far hinterlands around a metro as long as they watch those local TV stations. As an example, Tampa is only the 20th largest metro by Census definitions, but the 12th largest TV market, and the largest in Florida. I'm sure this is because there is a fairly dense strip of households along the entire west coast of Florida, and they probably watch the Tampa TV stations even if they're way beyond the Census-defined metro area.

As another example, look at Philadelphia, whose metro only has 15% more people than Houston according to the Census, but has 50% more households according to Nielson. I'm betting Nielson is including wide swaths of New Jersey, Delaware, Maryland, and eastern Pennsylvania in Philly's TV market, even though they can be pretty far from the city itself. What's the common thread between Philly and Tampa? Lots of nearby coastline, and people like to live near a coast, even if it's far from a metro. Certainly Houston has its share of nearby coastline, but it hasn't filled in with the same density as the northeast or Florida (tip: buy now while it's still affordable).

The trends are all about what you would expect: LA, DFW, Atlanta, and Houston all growing strongly (the sun belt); NY, Chicago, DC, and Philly holding even; and Boston, SF, and Detroit declining (all from weak local economies, plus unaffordable housing in Boston and SF).

I have no idea if this will make any difference in the advertising you'll see and hear. How many advertisers restrict themselves to the top 10 markets? Seems pretty arbitrary and limiting, although it does hit almost a third of the country. Maybe now we get to see the "world class" commercials?...

12 Comments:

At 8:26 AM, August 29, 2005, Anonymous RJ said...

Tory -

RE - Tampa is only the 20th largest metro by Census definitions, but the 12th largest TV market, and the largest in Florida. I'm sure this is because there is a fairly dense strip of households along the entire west coast of Florida, and they probably watch the Tampa TV stations even if they're way beyond the Census-defined metro area

Keep in mind that the Tampa/St. Pete/Clearwater area is a hub of retirees, meaning that you have small households. This is my guess as to why they are a disproportionately larger TV market than their population count would suggest.

 
At 10:04 AM, August 29, 2005, Anonymous John Sterling said...

http://www.proximityone.com/msarank04.htm

Housston is the 7th largest MSA based on 2004 population.

 
At 1:46 PM, August 29, 2005, Blogger Tory Gattis said...

Cool. Thanks for the link. We passed up DC. Within a few years, I think we will pass Philly and Miami to make the top 5, and if DFW slows down, top 4. SB-Riverside, Atlanta, and Phoenix also seem to be moving aggressively up the rankings.

 
At 2:13 PM, August 29, 2005, Anonymous RJ said...

I've seen some predictions that Phoenix will pass Houston in metropolitan population around 2025 or 2030.

What exactly is it that everyone does out there besides build homes for SoCal refugees? ;-)

 
At 3:10 PM, August 29, 2005, Blogger Tory Gattis said...

Yep, Phoenix does seem to be mostly home building, retirees, and resort tourism in the winter. Some tech and aviation. But companies are moving more cost sensitive operations from California to there. Not attracting many big HQs, but more mid-level stuff.

I doubt the estimate on passing up Houston. Nobody can predict out that far - just a straight line extrapolation, probably from the 90s. I'm not sure they have the water to support that size population either. It's based on extrapolating percentage growth, but we're still adding more people (numerically) every year except for LA, SB-Riverside, and DFW. See

http://www.proximityone.com/msarank04.htm

and sort by numerical growth. As an example, our percentage growth is almost double LA, but as long as they're adding 130K/year and we're adding 100K/year, we can't ever catch them (not that we necessarily want to).

 
At 5:19 PM, August 29, 2005, Anonymous Anonymous said...

Nobody can predict out that far

It's similar to the numbers used by Blueprint Houston, the whole population doubling by 2025 thing...

 
At 5:40 PM, August 29, 2005, Blogger Ring Zero said...

If current populations of Houston and Los Angeles are H and L, and the growth rates are h and l, then Houston will overcome LA in

log[ L/H ]
--------
log[ (1+h)/(1+l) ]

years.

 
At 7:35 PM, August 29, 2005, Blogger Tory Gattis said...

So the question is: did Houston attract 439,000 new people over the last 4 years because of our 9.26% growth rate, or did we just attract 439,000 people, which just happens to work out to 9.26%? Either our growth numbers have to really explode going forward, or our percentage growth has to decline over time (the most common case for big cities).

 
At 9:30 PM, August 29, 2005, Anonymous RJ said...

Tory -

A word about predicting as far out as 25 years into the future...

Obviously there are so many variables that you just can't begin to take into account. Nevertheless, we rely on conservative, moderate, and aggresive population growth scenarios of this sort developed by demographers to help shape planning and governmental decisions. An example would be the H-GAC 2025 plan. You need to be able to make educated guesses about growth in order to plan infrastructure investments and so forth.

A sidenote - not long ago I had to use a variety of growth projections for Fort Bend County, and it was interesting to find that in the past even the aggressive near-term population growth projections were sometimes too low.

Regarding Phoenix, they have a young and growing Hispanic population as we do. However, they also will receive a lot of growth from California escapees and retirees, which are two sizable groups that we'll see comparatively little of around here. And yes, water will be an issue. Will Phoenix pass us? Time will tell, and it doesn't especially matter from our perspective, but what is likely is that Phoenix will likely continue its explosive growth into the future and from a population perspective they'll be hot on our heels.

 
At 10:23 PM, August 29, 2005, Blogger Tory Gattis said...

I absolutely agree on the need for estimates for planning purposes, and I definitely think Phoenix will be growing fast for a long time to come. I really don't see many limits to either Phoenix or Houston's long-term growth. I just don't agree on extrapolating existing percentage growth rates out indefinitely. Experience has shown that the fastest percentage growers are the smaller communities, and that percentage realistically has to decline over time. No city on the list - no matter how big - seems to be able to add more than about 130,000 people/year. I like that HGAC long-range estimates seem to be a pretty flat 100,000 people/year for Houston - not a geometrically growing percentage estimate.

 
At 6:00 AM, August 30, 2005, Anonymous RJ said...

Tory -

I just don't agree on extrapolating existing percentage growth rates out indefinitely.

I'm not a demographer, but I'm guessing/hoping that they use methods that are a bit more sophisticated than that.

 
At 11:19 AM, August 30, 2005, Blogger Andrew said...

As long as California has the cost of living and high taxes it has then Phoenix will continue to ground faster than normal.

 

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