Nielsen's Management Presents At Credit Suisse Global Services Conference (Transcript)

Nielsen Holdings N.V. ( NLSN)

Credit Suisse Global Services Conference

March 12, 2012 12:00 p.m. ET


Brian West - Chief Financial Officer


Kelly Flynn - Credit Suisse


Kelly Flynn - Credit Suisse

We’re happy to have Nielsen here presenting. Presenting for the company is the CFO, Brian West, and it looks like we will take a few questions in this room and then there will also be a breakout session following this session. So with that I will turn it over to Brian. Thanks.

Brian West

Thanks, Kelly. It's great to be here. So I'll start with a little bit about, for those of you who may not be as familiar who we are. So Nielsen wraps itself around two fundamental engagements with the consumer. It’s what they buy and what they watch. And the whole objective is to take that information and help inform markets around the world. No one else has the buy and the watch, and we think that gives a unique advantage as we help our clients navigate a consumer that’s grown all around the world.

We’ve got values, we have expressed them from the very beginning of 2006 when it went private. Around being a open, simple and integrated company. We highlight those because we think they are unique in the place we play around information services and market research. Particularly around how we are open to just about anyone in this space to help get better answers on behalf of the clients and how to integrate. How to integrate both our watch and our buy products so that again we can help navigate very big questions on behalf of our marketers. And we’ve got a brand that’s stood the test of time 90 plus years.

From a highlight standpoint, I mentioned what consumers watch and buy. No one else has those two fundamentals engagements. And we do it all over the world, 100 countries. And our global map we think gives us unique competitive advantage around the world. We also data that is mission critical to our clients. I will talk more about that but it is embedded in the workflows and decision making of how they run businesses every day.

We like syndicated products. We are not interested in doing custom work. We like things that can scale. And we are driving two big market trends we will talk about in a minute around growth for the long term. And as I will show, we have got a track record of a business model that holds up. It’s held up not just in good times but bad times. And we will talk a little about how it’s done that through the course of just the last few years.

In terms of how we make money. Two sides of our business. As I mentioned, what consumers buy on the left. A good illustration of this is our relationship with Nestle. Nestle has been with us for 50 plus years. About two thirds of the relationship with Nestle is around retail market share. We tell them their retail market share for all their brands around the world. And it’s relationship that’s been going on for many years. It’s a long-term contract in nature as many in the buy side are.

Typically a buy client will have a contract anywhere from three to eight years. Average is around five. And on top of that the other part of the relationship, the other third, is around insights. How we help clients like Nestle look around the corner; how do we help them with new product introductions; how to forecast new products; which distribution chain it should go into. As well as defending existing brands on the shelf. Pricing, promotion, packaging, assortment study, all things that help clients in our buy side be more competitive. It’s two-thirds of the business total on our buy side. One that is, again, the most global. There is a big developing markets business inside there. And one that again has stood this of time largely driven by a fundamental data business that is built for the long-term.

Moving on to the watch side on the right. A good example is our relationship with CBS. Have been in with us as relationship for 70 plus years. And again here’s what, 80% of our relationship with the watch clients are around measuring their TV viewing audiences. Again, contracts are anywhere from three to seven years, average is a little over five. Ones that have very high renewal rates and ones where once you get outside of the contractual relationship there is another 20% of our relationship, is where we give them analytics and insights around they can compete. Whether it’s pricing their inventory more effectively or maximizing their content.

We help them drive lots of programming decisions and also lots of sales decisions as they try to provide those audiences to the advertisers. Again, buy and watch, we are fundamental in both. Both are embedded in our clients. Thousands of people in or around either a Nestle or CBS touch our data every single day as they think about making decisions to growth their businesses.

I mentioned our global breadth. Here’s our map. Everywhere you see a blue dot is where we have a Nielsen presence. It’s 100 countries plus. And if you think about how this have evolved, it’s been over many decades where we have built this footprint. It started in the 1930s with the second generation Nielsen family started to move out and move east. The fact of the matter is over the next five or ten years, the exact opposite will happen. Many companies, many brands from the east will move west. And when they do this, the move right into our footprint.

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