They seem to cut out chunks of ~5000 homes and then choose one home to represent that group. Pretty dumb imo, but they say when you look at it big-picture it's more accurate. If I said no they would just randomly pick another home in my area. I think they do use ethnic demographics in selecting their groups, but they don't look into who actually lives in the home they pick. They state they don't know anything more than what we happen to be watching, and they can only use data that's linked to some kind of service like Netflix or YT-TV. As far as who's watching, they get your ethnicity, age range and sex. On their remote you're just 'Person 1' or 'Person 2', etc.