Zero-inflated truncated generalized Pareto distribution for the analysis of radio audience data

Abstract

Extreme value data with a high clump-at-zero occur in many domains. Moreover, it might happen that the observed data are either truncated below a given threshold and/or might not be reliable enough below that threshold because of the recording devices. These situations occur, in particular, with radio audience data measured using personal meters that record environmental noise every minute, that is then matched to one of the several radio programs. There are therefore genuine zeros for respondents not listening to the radio, but also zeros corresponding to real listeners for whom the match between the recorded noise and the radio program could not be achieved. Since radio audiences are important for radio broadcasters in order, for example, to determine advertisement price policies, possibly according to the type of audience at different time points, it is essential to be able to explain not only the probability of listening to a radio but also the average time spent listening to the radio by means of the characteristics of the listeners. In this paper we propose a generalized linear model for zero-inflated truncated Pareto distribution (ZITPo) that we use to fit audience radio data. Because it is based on the generalized Pareto distribution, the ZITPo model has nice properties such as model invariance to the choice of the threshold and from which a natural residual measure can be derived to assess the model fit to the data. From a general formulation of the most popular models for zero-inflated data, we derive our model by considering successively the truncated case, the generalized Pareto distribution and then the inclusion of covariates to explain the nonzero proportion of listeners and their average listening time. By means of simulations, we study the performance of the maximum likelihood estimator (and derived inference) and use the model to fully analyze the audience data of a radio station in a certain area of Switzerland.