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CHAPTER NINE PLANNING MEDIA STRATEGY: FINDING LINKS TO THE MARKET OBJECTIVES To show how communications media help advertisers achieve marketing and advertising objectives. To get their messages to the right people in the right place at the right time, media planners follow the same procedures as marketing and advertising planners: setting objectives, formulating strategies, and devising tactics. To make sound decisions, media planners today must possess marketing savvy, analytical skill, and creativity. (p. 266) After studying this chapter, your students will be able to: 1. Describe how a media plan helps accomplish a company’s marketing and advertising objectives. 2. Explain the importance of creativity in media planning. 3. Define reach and frequency and debate the controversy surrounding the concept of effective frequency. 4. Discuss how reach, frequency, and continuity are related. 5. Calculate gross rating points and cost per thousand. 6. Name some of the secondary research sources available to planners and describe how they are used. 7. Describe different types of advertising schedules and the purpose for each. TEACHING TIPS AND STRATEGIES This chapter will aid the student in understanding how and why media buys are placed. Many of my clients in advertising use to believe that advertising was about the number of spots you buy (frequency). If they could purchase 500 spots in a week, they thought that was better then the 30 or 40 spots they would get on Network television. What many local advertisers failed to realize is it isn’t only about the number of spots (frequency), but the reach and cost per thousand (CPM) is what is important. This discussion will focus on the differences between cable and network television buys from my experience. It is my intention that the reader will get a better understanding of advertising on cable versus network television. As the reader knows, network television is not subsidized with monthly fees as cable is. Therefore, cable can afford to charge cheaper rates then network television. It looks cheaper on the surface. Cable usually will give an advertiser ten to fifteen channels that they will have five hundred spots run on. The problem with that many channels is that it reduces the frequency an ad is seen and not all of the advertisers target market will see the ad. Remember, that frequency is the number of times an ad is viewed. My sales manager used to explain to me, “…a frequency of four is minimum; we are shooting for a seven.” This means that a commercial needs to be seen at least four times to get a good return on 149 investment (ROI). Seven is a better number, and one that many of our national advertisers use to shoot for. The other disadvantage of cable in my opinion is that its reach is not what networks television is. For example in our viewing area, it was quite normal for cable to have only a couple thousand of households viewing at any given time. On the other hand, on network television we would have literally thousands viewing in our DMA (designated marketing area). Our reach was much greater. Fragmentation has really hurt network television and the cable systems. I have watched as what use to be three to four cable systems in a state now go down to one or two. This will help the cable systems reach problem. For instance, If there are four cable systems in a state, and the advertiser is only advertising on one of them. Guess what? The other three systems are not carrying that signal. As more cable companies merge, this will be less of a problem. To wrap up this quick discussion it is important to note that it is not about the number of spots bought on television. It is about the reach/frequency of those commercials. Who cares if someone sees an ad one time it will not be as effective as seeing the same ad four to seven times. When I created advertising plans, it was important to note that selling ads on network television we had a higher reach (we reached more people) then cable. This gave us an advantage, because we would reach more people then our cable counterparts and this in turn would give our advertisers an advantage over cable. Who cares if someone sees an ad 10 times if only a couple hundred of people are watching, unless that couple of hundred people are a firms bread and butter customers. LECTURE OUTLINE Introduction (pp. 267-269) — The story of how The Media Edge devised an ingenious street-level guerilla marketing campaign with a most unusual media plan for the introduction of Sony’s Street Style Headphones. Formed in 1994, The Media Edge has grown phenomenally fast and is now one of the largest media buying firms in the world, billing over $10 billion annually. II. Media Planning: Integrating Science with Creativity in Advertising (p. 269). The purpose of media planning is to conceive, analyze, and select channels of communication that will direct advertising messages to the right people in the right place at the right time. It involves many decisions: 1. Where should one advertise? 2. Which media vehicles should be used? 3. When during the year should the advertising be concentrated? 4. How often should we run the advertising? 5. What are the opportunities for integrating our media advertising with other communication tools? A. The Challenge (p. 269) As the complexity of the field increases, media decisions become more critical and clients more demanding. Much media buying has been unbundled from other agency I. 150 services. Advertisers want agencies to be more than efficient. They want accountability, as well as creative and well-negotiated buys. B. Increasing Media Options (p. 270) 1. Today, there are more media to choose from, and each offers more choices. TV is now fragmented into network, syndicated, and local television, as well as network and local cable. 2. National magazines publish for particular regions or demographic groups. Exhibit 9-1 U.S. Spending by medium (p. 271), A9-1 (p. 271) 3. Nontraditional media (videotapes, movie advertising, computer on-line services, electronic kiosks, and even shopping carts) expand the menu of choices. 4. Specialized communications (direct marketing, sales promotion, public relations activities, and personal selling) are “below-the-line” activities that represent the fastest growing segments at some of the large agency holding companies, like WPP and Interpublic. Ad Lab 9-A “Off-the-Wall Media That Pulls Customers Off The Fence.” (p. 272) 5. The “media menu” needs to include everything that carries a message to and/or from customers and other stakeholders. The proliferation of toll-free phone numbers, faxes, the Internet, and company Web sites, make customers feedback easier and more immediate. C. Increasing Fragmentation of the Audience (p. 271) Consumers are selective in choosing what particular articles to read, which cable or network TV shows to watch, and what radio programs to listen to. Exhibit 9-2 Time spent with media (p. 273) D. Increasing Costs (p. 272) The cost of exposing 1,000 people (CPM-cost per thousand) to each of the major media rose faster than inflation. People can cope with only so many messages, so media have to restrict the number of ads they sell. Shows with big audiences are at a premium today. D. Increasing Complexity in Media Buying and Selling (p. 273) Now, media buys are more complex than ever. Media companies put together massive multimedia packages, which they sell as "value added programs” designed to add value to traditional media placements. Media planners face growing pressure to learn how to evaluate and execute these complex deals. “Partnerships” add to complexity. The trend toward integrating marketing communications and relationship marketing is creating a new breed of media planner — younger, computer literate, and schooled in marketing disciplines beyond traditional media. A good media specialist must be an “advertising generalist.” Ethical Issue: “The Ethical Dilemmas of Agency Compensation” (pp. 274, 275) E. Increasing competition (p. 274) Independent media- buying services have grown dramatically in the last decade, attracting some of the best and brightest talent in the business to compete with agencies for what was once their private domain. During the 90s, the large agency holding companies started buying up the independents. Now all the large ones are back under agency control, albeit at arms length. Exhibit 9-3 Media Powerhouses (top media specialist companies ranked by billings (p. 276) 151 III. IV. The Role of Media in the Marketing Framework (p. 275) A. Marketing Objectives and Strategy (p. 275) 1. Determining marketing objectives for a brand or service and developing strategies, which map out a plan for attaining those objectives is derived from the marketing situation analysis (or “SWOT analysis” as discussed in chapter 7). Marketing objectives may focus on solving a problem or seizing an opportunity. 2. Marketing strategies lay out the steps for meeting these objectives by blending the four elements of the marketing mix. Advertising is just one of the many strategic tools a company may use to achieve its marketing objectives. B. Advertising Objectives and Strategy (p. 274). The objectives and strategies of an advertising plan unfold from the marketing plan. Nevertheless, advertising objectives focus on communication goals. (e.g., “convincing 25 percent of the target market next year of the brand’s need-satisfying abilities). To achieve these objectives, companies devise advertising strategies that employ the elements of the creative mix: the product concept, target audience, advertising message, and communication media. The media department ensures that the ad message gets to the correct target audience effectively. Exhibit 9-4 Media planning activities (p. 277) C. The Media-Planning Framework (p. 278) 1. Media planning is done early because media are how the customers make contact with the product. 2. Developing a media plan involves the same process as marketing or advertising planning. a. Review marketing and ad objectives. b. Set measurable objectives that can be achieved by the media. c. Determine a strategy to achieve the objectives. d. Set down tactical details. Defining Media Objectives (p. 278) Media objectives translate the advertising strategy into goals that media can accomplish. Exhibit 9-5 How media objectives are expressed. (p. 278) Media objectives have two major components: A. Audience Objectives (p. 278) 1. Audience objectives define the specific types of people the advertiser wants to reach. 2. Top-down planners use geodemographic classifications to define their target audience. a. The target audience may not be actual users of the product. Advertisers may have to advertise to the trade (as well to the customers) to convince retailers their media buys will result in more sales. b. Planners rely largely on secondary research. 3. Planners select media vehicles, particular magazines, or broadcast programs according to how well they "deliver" or expose the message to the desired target audience. 152 Advertisers using the integrated marketing communications (IMC) planning model start by segmenting their target audiences according to brand-purchasing behavior and then ranking them by profit to the brand. Communication objectives are then stated in terms of reinforcing or modifying customer purchasing behavior or creating a perceptual change about the brand over time. Media research costs often limit the amount of data marketers would like to see. Exhibit 9-6 A media planner’s toolbox (p. 280) B. Message-Distribution Objectives (p. 279) Distribution objectives define where, when, and how often advertising should appear. To answer these questions, a media planner must understand the following: 1. Audience size and message weight (p. 279) a. Audience size — simply the number of people in the medium’s audience. In print media, for example, Audit Bureau of Circulation actually count and verify the number of subscribers (circulation) and multiply by the number of readers per copy (RPC) to determine total audience. b. Message weight — media planners often define media objective by the schedule's message weight, the total size of the audience for a set of ads or an entire campaign. Message weight can be expressed as: 1) Advertising impression: possible exposure of the advertising message to one audience member, sometimes called an opportunity to see (OTS). 2) Gross Impressions: the total number of potential exposures (audience size by the number of times the ad message is used during a period). Exhibit 9-7 Gross impressions analysis for Brand X in the second quarter, 2003 (p. 281) 3) As gross impressions are often expressed in millions and are awkward to handle, media planners prefer to use percentages — or a rating, for example, a rating of TV households is the percentage of homes exposed to an ad medium. A rating of 20=20% of the households with TV sets; television households, or (TVHH). 4) Gross Rating Points (GRPs) — the total weight of a specific media schedule, computed by multiplying the reach, expressed as a percentage of the population, by the average frequency. GRP unit costs decrease the more GRPs are bought. Exhibit 9-8 Gross rating points analysis for Alpha brand in the second quarter, 2003 (p. 281) 2. Audience Accumulation and Reach (p. 281) Reach refers to the number of different people or households exposed at least once to an ad or campaign during a given period of time, usually four weeks. This number, however, does not take into account the quality of the exposure. The term “effective reach” describes the quality of exposure. It measures the number of percentage of the audience who receive enough exposures for the message to have the desired effect. Accumulating reach is done two ways: same media over time or combining media vehicles. Exhibit 9-9 Statistical table that shows how unduplicated reach builds as additional media are added. (p. 282) A9-2 (p. 282) 3. Exposure Frequency (p. 282). Frequency refers to the number of times the same person or household is exposed to a message — a radio spot, for example — in a 153 specified time span. It measures the intensity of a media schedule, based on repeated exposures to the message. a. Frequency is important because repetition is the key to memory. b. Average frequency = Total Exposure ÷ Audience reach, and Reach x Frequency = GRPs. c. Conventional wisdom considers effective frequency to be three or more opportunities-to-see (OTS) over a four-week period, but no magic number works for every commercial and every product. The concepts of effective reach and frequency are controversial, but virtually all agencies use them. Most studies of the advertising response curve indicate that incremental response to advertising actually diminishes — rather than builds — with repeated exposures. The optimal frequency concept moves the focus of media planning from exposure effectiveness to effective exposures per dollar. 4. Continuity (p. 283) refers to the duration of an advertising message or campaign over a given period of time. While frequency is important to “create” memory, continuity is important to “sustain” it. V. Optimizing Reach, Frequency, and Continuity: The Art of Media Planning (p. 282) Exhibit 9-10 shows, the objectives of reach, frequency and continuity have inverse relationships to each other (p. 283) A9-3 (p. 283) Good media planning is both an art and a science. The objectives of reach, frequency, and continuity have inverse relationships to each other. A. Effective Reach (p. 283) 1. Some exposed to an ad in a medium will not be aware of the message. 2. Effective reach describes the quality of the exposure, measuring the number or percent-age of the audience who receive enough exposures to truly receive the message. Some researchers maintain three OTSs over a four-week period. B. Effective Frequency (pp. 283, 284) 1. Effective Frequency is the average number of times a person must see or hear a message before it becomes effective (between a minimum level that achieves awareness and a maximum level that becomes overexposure that leads to “wear out” and irritates customers). 2. Controversy over “learning” versus “reminding” and that conventional media planning is built on “media vehicle exposure” (the number of people in a medium’s audience) when it should relate to “advertising message exposure.” Cannon and Riordan would replace “effective frequency” with “optimal frequency.” 3. Advertising response curve — a curve indicating responses to advertising in relation to frequency. Studies show that incremental response to advertising actually diminishes — rather than builds — with repeated exposures. Exhibit 9-11 advertising response curve (p. 284) A9-4 (p. 284) 4. Cannon and Riordan’s theory has strong implications. Historically, frequency has been most important objective (assumes S shaped response curve). Cannon and Riordan’s analysis indicates response curve is actually convex, the first exposure is the most effective, followed by diminishing returns. If this is accurate, advertisers should switch from maximizing frequency to maximizing 154 VI. target market reach, adding less profitable second exposures only as budget permits. 5. Recency planning is based on the belief that most advertising works by influencing the brand choice of consumers who are actually ready to buy. This would suggest that continuity is the most important objective. Developing a Media Strategy: The Media Mix (p. 285) The media strategy describes how the advertiser will achieve the stated media objectives: which media will be used, where, how often, and when. Advertisers develop media strategies by blending the elements of the media mix. A. Elements of the Media Mix: The Five Ms (p. 285). Media planners use the Five Ms (5Ms) of the media mix (markets, money, media, mechanics, and methodology) to develop an effective media strategy. A9-5 Kinko’s advertisement exemplifies 3 of the 5 M’s of the media mix (p. 285) 1. Markets refer to the various targets of a media plan: trade and consumer audiences; global, national, or regional audiences; or certain ethnic or socioeconomic groups. 2. Money — using intuition, marketing savvy, and analytical skill, the media planner determines how much money to budget and where to allocate funds: how much for print, TV, etc. 3. Media includes all communications vehicles available to a marketer, such as radio, TV, newspaper, magazines, etc. 4. Mechanics includes the complex mechanics (time and size units, etc.) of advertising media and messages. IMC planners may also deal with the mechanics of nontraditional media: everything from shopping bags to multimedia kiosks to the Internet. 4. Methodology refers to the overall strategy of selecting and scheduling media vehicles to achieve the desired reach, frequency and continuity objectives. B. Factors that Influence Media Strategy Decisions (p. 286) Media decisions are greatly influenced by a variety of factors over which the media planner has little or no control. These include: 1. Scope of the Media Plan (p. 285). The location and makeup of the target audience strongly influences the breadth of the media plan, thereby affecting decisions regarding the following: a. Domestic markets. A media planner normally limits advertising to areas where the product is available. Different media are required for local, regional, and national markets b. International markets. Foreign media can be a challenge for U.S. advertisers. Because of the media variations from country to country, most international and global advertisers entrust national media plans to in-country foreign media specialists rather than risk faulty centralized media planning. In Europe, over 60 percent of total advertising expenditures are spent on print media versus 25 percent on TV. The Internet is exploding in Europe, and advertisers are just now adapting. Most international advertisers develop a series of national plans first, combining them for their international plan later. In some European countries and in Asia, media research and planning are probably more sophisticated than in the United States. 155 2. Sales Potential of Different Markets (p. 287). The market and money elements of the media mix also depend on the sales potential of each area. Planners can determine an area's sales potential in several ways. a. The brand development index (BDI) indicates the sales potential of a particular brand in a specific market area. Formula: “BDI” equals “percent of brand’s total U.S. sales in the area” divided by “percent of total U.S. population in the area” by 100. b. The category development index (CDI) indicates the sales potential of an entire product category. Formula: “CDI” equals “percent of the product category’s total U.S., sales in the area” divided by “percent of total U.S. population in the area” by 100. Exhibit 9-12 The combination of BDI and CDI can help the planner determine a media strategy for the market (p. 288) A9-6 (p. 288) 3. Competitive Strategies and Budget Considerations (p. 288). Advertisers always consider what competitors are doing, particularly those that have larger advertising budgets. This will affect the media, mechanics, and methodology elements of the media mix. It sometimes makes sense to use media similar to the competition's if the target audiences are the same or if competitors are not using their media effectively. Media planner should analyze the company’s “share of voice” in the market place. 5. Media Availability and Economics: The Global Marketer's Headache (pp. 288, 289). Every country has communications media, but they are not always available for commercial use — especially radio, television—, and coverage may be limited. Lower literacy rates and education levels in some countries restrict the coverage of print media. Where income levels are low, TV ownership is also low and motion picture attendance is usually high. These factors tend to segment markets by media coverage. See also checklist: International Media Planning P. 290 Exhibit 9-13 Shows the total local ad agency billings for the top 10 advertising cities outside the U.S. (p. 289) Spillover media: local media that many consumers in a neighboring country inadvertently receive, e.g. media from Luxembourg regularly spill over into France, Belgium, and Holland. Spillover media pose a threat for the multinational advertiser because they expose readers to multiple ad campaigns. 6. Nature of the Medium and Mood of the Message (p. 289). An important influence on the media element of the mix is how well a medium works with the style or mood of the particular message. Each circumstance affects the media selection as well as the methodology of the media mix. a. Some media lend themselves better to certain types of messages or creative approaches. b. The best media strategy depends on the type of message — dogmatic, emotional, rational, complex, etc. 7. Message Size, Length, and Position Considerations (p. 291). The particular characteristics of different media, over which the media planner has no control, affect the “mechanics” element of the media mix. A9-7 Godiva chocolate ad exudes a sense of elegance that suits the audience of the medium selected (p. 291) 156 VI. Exhibit 9-14 Color and larger units of space or time cost dearly in terms of reach and frequency (p. 291) A9-8 (p. 291) a. Nature of advertising require more time and space to explain. b. Competitive activity may dictate more message units. c. Consideration of where to position an ad in various media affects media strategy. d. The media planner must weigh the benefits of any additional costs in terms of potential sales impact against the loss of reach and frequency. 8. Buyer Purchase Patterns (p. 291). Finally, the customer's product purchasing behavior affects every element of the media mix. Products with short purchase cycles (convenience goods) require more constant levels of advertising than products purchased infrequently (furniture). RL 9-1 (Website) C. Stating the Media Strategy (p. 292). A written rationale for the media strategy is an integral part of any media plan. 1. Generally, the strategy statement starts with a brief definition of target audiences (the market element) and the priorities for weighting them. 2. The statement should explain the nature of the message and indicate which media types will be used and why (the media element). 3. It outlines specific reach and frequency goals and how they are to be achieved (methodology element). 4. It provides a budget for each medium (the money element) including the cost of production and any collateral materials. 5. Finally, it states the intended size of message units, any position or timing considerations (the mechanics element), and the effect of budget restrictions. Media Tactics: Selecting and Scheduling Media Vehicles (p. 292) Once the general media strategy is determined, the media planner can select and schedule particular media vehicles. A. Criteria for Selecting Individual Media Vehicles (p. 292). In evaluating specific media vehicles, the planner considers several factors: RL 9-2 (Website) 1. Overall Campaign Objectives and Strategy (p. 292) a. The media planner's first job is to review the nature of the product or service, the intended objectives and strategies, and the primary and secondary target markets and audiences. b. The planner identifies the characteristics most relevant to the acceptance, purchase, and use of the product. Includes analyzing content and editorial policy of media vehicle. c. The planner then matches these data to the characteristics of the audience of the specific media vehicles under consideration. Advertising is most effective when it positions a product as part of the solution the consumer seeks. Ad Lab 9-B “Media Selection: Quicklist of Advantages.” (p. 292) 2. Characteristics of Media Audiences (p. 293) a. Audience is the total number of people or households exposed to a medium. The planner needs to know how closely the medium's audience matches the 157 profile of the target market and how interested such people are in the publication or program. b. The content of a medium usually determines the type of people in the audience. Each type or programming attracts a different audience. 3. Exposure, Attention, and Motivational Value of Media Vehicles (p. 293). The media planner has to select media that will not only achieve the desired exposure to the target audience, but also attract attention and motivate people to act. a. Exposure Value. To understand the concept of exposure value, think of how many people an ad "sees" rather than the other way around. Five factors that affect the probability of ad exposure are: 1) The senses used to perceive messages from the medium. 2) How much and what kind of attention the medium requires. 3) Whether the medium is an information source or a diversion. 4) Whether the medium or program aims at general or specialized audience. 5) The placement of an ad in the vehicle (within or between broadcast programs; adjacent to editorial material or other print ads.) b. Attention. The degree of attention is another consideration. Exposure value relates only to the medium; attention value concerns the advertising message and copy, as well as the medium. Six factors are known to increase attention value: 1) Audience involvement with editorial content or program material. 2) Specialization of audience interest or identification. 3) Number of competitive advertisers (the fewer the better). 4) Audience familiarity with the advertiser's campaign. 5) Quality of advertising reproduction. 6) Timeliness of advertising exposure. c. Motivation — these same factors affect a medium's motivation value, but in different ways. The attention factors of quality reproduction and timeliness can motivate someone. Media planners assign numerical ratings to their judgments of a medium’s strength and weaknesses, and then; using a weighting formula, add them up. 4. Cost Efficiency of Media Vehicles (pp. 294, 295). Finally, media planners analyze the cost efficiency of each medium. A common term used in media planning and buying is: a. Cost per thousand (CPM), which is based on the medium's total audience (ad cost divided by the number of thousands of people in the audience). b. However, media planners are more interested in cost efficiency, which relates to the cost of exposing the message to the target audience rather than to the total circulation (percentage of total audience held by the target market times the subscriber base = the cost per thousand to reach the targeted market). c. The media planner must evaluate each medium’s advantages and disadvantages, using all the criteria to determine: 1) How much of each medium’s audience matches the target audience. 2) How each medium satisfies the campaign’s objectives and strategy. 158 3) How well each medium offers attention, exposure, and motivation. d. The media planner may want to calculate the cost per point (CCP) of different broadcast programs. This is done the same way as cost per thousand, except you divide the cost by the rating points instead of the gross impressions. B. Economics of Foreign Media (p. 295). The main purpose of media advertising is to communicate with customers more efficiently than through personal selling. 1. In some undeveloped countries, it is cheaper to do personal selling (e.g., send people out with baskets of goods). 2. In many foreign markets, outdoor advertising enjoys far greater coverage than in the U.S. 3. Costs inhibit the growth of broadcast media in some foreign markets, but most countries now sell advertising time to help foot the bill. C. The Synergy of Mixed Media (p. 295) A combination of media is called a mixed media approach. Reasons for using a mixed media are: 1. To reach people unavailable through only one medium 2. To provide repeat exposure in a less-expensive secondary medium after attaining optimum reach in the first. 3. To use the intrinsic value of an additional medium to extend creative effectiveness of the ad campaign. 4. To deliver coupons in print media when the primary vehicle is broadcast. 5. To produce synergy, where the total effect appears to be greater than the sum of the parts. D. Methods for Scheduling Media (p. 296). After selecting the appropriate media vehicles, the media planner decides how many space or time units of each vehicle to buy and schedules them for release over a period of time when consumers are most apt to buy. 1. Continuous, Flighting, and Pulsing Schedules (p. 296) Exhibit 9-15 Three ways to schedule the same number of total gross rating points: continuous, fighting and pulsing (p. 295) A9-9 (p. 295) a. Continuous schedule — advertising runs steadily and varies little over the campaign period. b. Flighting — alternates periods of advertising periods of no advertising. c. Pulsing — mixes continuous and flighting strategies by using a low level of advertising all year combined with heavy advertising during peak selling periods. 2. Additional Scheduling Patterns (p. 296) a. For high-ticket items that require careful consideration, bursting, running the same commercial every half hour on the same network in prime time, can be effective. b. A variation is road blocking, buying airtime on all three networks simultaneously. c. For slim ad budgets, blinking is used – flooding the airwaves with spots just before a known purchase occasion. 159 2. Once the scheduling criteria are determined, the media planner creates a flowchart of the plan. The flowchart is a graphic presentation of the total campaign. (Look back to 8-1 in the Reference Library on the CA website). Exhibit 9-16 Media plan flow chart (p. 297) F. Computers in Media Selection and Scheduling (p. 297). Computers perform the tedious number crunching needed to compute GRPs, CPMs, reach, frequency, and the like. They also save time and money. Advertising executives may now gather information from their media directories electronically (like Standard Rate & Data Service’s program called Media-Scope) and then create timely budgets for their clients. Telmar, established in 1968, is the world’s largest supplier of Windows and Internet-based media planning software and support services. More than 95 percent of the world’s top agencies use Telmar systems for media decision-making. Similarly, Interactive Market Systems (IMS) has PC software and on-line data for the business-to-business computer marketplace. Example: Media Solutions advertisement software available for media planning (p. 298) AD LAB 9-A “Off-the-Wall Media That Pull Customers off the Fence.” (p. 272) 1. How effective are off-the-wall media? Some can be very effective. It depends on many factors, including relation of the medium to the target audience and of the particular product, the cost of the medium, and the message. Advertising in sports programs and at sports stadiums, for example, can be perfect for companies whose target audience is spots fans. 2. What other off-the-wall media can you think of? Among the answers students might mention are: clothing, shopping carts, sports programs, bumper stickers, school yearbooks, matchbooks, bus stop seats, etc. AD LAB 9-B “Media Selection: Quick list of Advantages.” (p. 292) 1. If you wanted a set of complementary media to cover all the creative advantages, which mix would you select? Answer guidelines: After examining the advantages information in Ad Lab 9-B, students will probably choose the mediums listed on the left column in the chart below. In the Reference Library chart, RL 9-1 (located on the Contemporary Advertising website), under “creative considerations,” three of the media are similar (TV, direct mail, and magazines). The RL 9-1 chart breaks the categories out in greater detail, clearly portraying television as the dominant leader. The chart below suggests the two patterns students will most likely choose: Ad Lab 9-B items RL 9-1 items (no ranking given) (ranked from strong to medium) 1. Television 1. Spot TV, Network TV, Cable TV 2. Magazines 2. Direct Mail 160 3. Direct mail 3. Consumer magazines, business & farm publications 4. Outdoor 4. Sunday Supplements and Daily an Weekly newspapers Example: General Motors devotes about one-third of its ad budget to network, spot, and cable TV advertising. Television certainly allows the viewer to see GM's cars in action. GM also puts about a quarter of its budget into magazines, which give high-quality reproduction and provide room for a more extensive message. Another quarter of the budget goes to newspaper ads, which reach the great majority of the population, promote seasonal sales, and support local dealerships. 2. What creative advantages can you add to the list? Example: Newspaper advantages — the ability to relate advertising to the news of the day; currency; believability; reader involvement. ETHICAL ISSUE “The Ethical Dilemma Created by Agency Compensation (p.274-275) 1. Compare the advantages and disadvantages of the commission system versus those of the fee or incentive system. Media commissions are typically 15% on any space or time purchased on behalf of the client. The advantage to the commission system is that the client doesn't incur any additional cost because, in effect, the client is paying exactly what it would cost them if they booked directly from the media company, (i.e., the client pays 100% of the cost and the media company gets 85% with the 15% retained by the agency). Clients sometimes argue that, with the commission system, the amount of time and labor to make and place ads is significantly lower in cost than the dollar amount received from commissions. However, the cost of supporting good account managers, creative production people, and vendors often consumes much of the income from commissions. The straight fee (retainer) system is cost plus a fixed fee for agency time and expertise The incentive system is a fee adjusted by campaign results. Because it is tied into results, the incentive system may ensure that an agency will create a campaign, which will be a "winwin" for all. 2. What problems, if any, does the commission system cause for small businesses that are less likely to advertise in high-cost media? An advertiser with a small media budget may not be considered worthy of representation by a major agency because the media commissions would not be large enough for the agency to make a substantial profit. REVIEW QUESTIONS 1. What major factors contribute to the increased complexity of media planning? (pp. 269-270) Major factors contributing to the increased complexity of media planning include more media to choose from; each medium offering a greater number of choices; a burgeoning number of nontraditional media; increased fragmentation of the audience; increasing costs of most media; and changes in the way media are bought and sold. 161 2. What must media planners consider before they begin? (pp. 269-275) The media planner must consider the marketing objectives and strategy, the advertising objectives, and the target audience. 3. What secondary research sources are available to planners? (Exhibit 9-4 pp. 277) Media planners use a variety of secondary sources that provide information to help them make better decisions on the job. Syndicated research companies such as Simmons Market Research Bureau (SMRB) and Mediamark Research, Inc. (MRI) produce reports that can be used to determine a brand or product's target audience—those who are most likely to buy. The reports provide demographic profiles of heavy and light users of various products and brands. They also specify which kinds of TV programs or magazines these heavy and light users are exposed to, enabling the planner to choose those media vehicles with the most potential for reaching the target audience. SMRB also gathers psychographic information on these consumers; these data are used to differentiate among people who may be in the same demographic group but who possess different psychological characteristics and personality traits. Broadcast Advertisers Reports (BAR), Leading National Advertisers (LNA), and Media Records report advertisers' expenditures by brand, media type, market, and time period. Media planners use these sources to find clues to the strategy of the brand's competitors; for example, the size of their budgets, the media they are using, the impact of region and season on their sales, and possible new product tests and introductions. 4. How does the IMC approach differ from the top-down media planning approach? Advertisers using the IMC planning model start by segmenting their target audiences according to brand-purchasing behavior (e.g., loyal users, brand switchers, new prospects), and then ranking them by profit to the brand. Communications objectives are then stated in terms of reinforcing or modifying customer purchasing behavior or creating a perceptual change about the brand over time. 5. What is the "right" reach and frequency for a given message? (pp. 283) The term reach refers to the total number of different people or households exposed at least once to an ad or campaign during a given period of time, usually four weeks. Frequency refers to the number of times the same person or household is exposed to a message — a radio spot, for example — in a specified time span. Repetition is the key to memory. Conventional wisdom considers effective frequency to be three or more opportunities-to-see (OTS) over a four-week period, but no magic number works for every commercial and every product. 6. How are GRPs and CPMs calculated? (pp. 294, 281) A GRP (gross rating point) is the total audience delivery of a media schedule. GRPs are computed by multiplying reach (expressed as a percentage of the population) by the average frequency. CPM (cost per thousand) is a measure of the cost efficiency of using a particular medium. It is calculated by dividing the cost of the ad by the size of the audience (number of readers, viewers, or listeners). 162 7. What are the 5Ms of the media mix, and how are they determined? (pp. 285-286) The 5Ms of the media mix are: a. Markets: refers to the various possible targets of a media plan, e.g. trade and consumer audiences; global, national, or regional audiences; or certain ethnic or socioeconomic groups. b. Money: how much to budget and where to allocate funds — how much for print, media, how much in TV, how much to each geographic area. c. Media: all communications vehicles available to a marketer, including broad media classes and subclasses such as radio, TV, newspaper, magazines, outdoor, direct mail, as well as various supplemental media and ancillary activities such as sales promotion, direct marketing, public relations and publicity, special events, and collateral materials. d. Mechanics: electronic commercials come in a variety of time units; and print ads are created in a variety of sizes and styles. IMC planners may also deal with the mechanics of nontraditional media: everything from shopping bags to multimedia kiosks to the Internet. e. Methodology: overall strategy of selecting and scheduling media vehicles to achieve the desired reach, frequency, and continuity objectives. 8. What major factors influence the choice of individual media vehicles? (p. 279) Overall campaign objectives and strategy; characteristics of media audiences; exposure, attention, and motivational value; and cost efficiency. 9. Why might an advertiser use a mixed media approach? (p. 295) There are numerous reasons for using mixed media: 1. To reach people who are unavailable through only one medium. 2. To provide repeat exposure in a less expensive secondary medium after attaining optimum reach in the first. 3. To use the intrinsic value of an additional medium to extend the creative effectiveness of the ad campaign (such as music on radio along with long copy in print). 4. To deliver coupons in print media when the primary vehicle is broadcast. 5. To produce synergy, where the total effect is greater than the sum of its parts. 10. What are the principal methods used to schedule media? (pp. 296-298) Advertising is scheduled so that consumers are exposed to it at the point when they are ready to buy. Scheduling approaches differ because consumer-purchasing patterns differ. Products that are purchased on a regular basis with little fluctuation in demand are usually advertised with continuity, where the advertising runs continuously with little variation. Flighting, an intermittent scheduling pattern that alternates periods of advertising with no advertising at all, is used for products and services that experience large fluctuations in demand throughout the year. Advertisers of products and services that are purchased throughout the year but are bought more heavily in certain seasons may use pulsing, which mixes continuity and flighting strategies. The advertiser maintains a low level of advertising all year but uses periodic pulses of heavier advertising during peak selling periods. 163 EXPLORING THE INTERNET The Internet exercises for Chapter 9 address the following areas covered in the chapter: media buying services (Exercise 1) and media organizations (Exercise 2). 1. Media Buying Services There are three sides to the media business: those who plan; those who buy; and those who sell. Media planning and media buying are often in-house functions at an advertising agency, while sellers are those who represent the various media to clients, agencies, and media buying services. Visit the websites for the media companies listed below, consider the impact and importance of each to advertisers and their agencies, and answer the questions that follow. The Media Edge (www.mediaedge.com) Media Solutions (www.mediasol.com) The Davis Group (www.thedavisgrouptx.com) Time Buying Services (www.tbsmm.com) WebConnect (www.webconnect.net) Initiative Media (www.wimc.com) Zenith Media Services (www.zenithmedia.com) a. Who is the intended audience(s) of the site? b. What is the site’s purpose? Does it succeed? How? c. What is the company’s purpose? d. Does the company specialize in any particular segment (consumer, business-to-business, agriculture, automotive)? Sample Answer: Zenith Media a. The intended audience of the site is two-fold: 1) advertising, marketing, and media professionals looking for an index to the Web’s wealth of advertising/marketing/media information; and 2) those agency, client, and media professionals interested in the services of Zenith Media. b. The site’s purpose, as the target audience profile suggests, is also two-fold: 1) provide an index to the Web’s marketing communication information (including direct links to over 4,000 resources); and 2) provide information on the company’s mission/purpose, range of services, and management/financial information. It succeeds by providing one of the most comprehensive indexes to the Web and by detailing Zenith’s range of services, clients, and corporate information. c. Zenith Media is positioned as the “world’s pre-eminent” media services agency, providing media planning, buying, evaluation, and coordination for agencies and clients around the globe. d. As a global agency for both Saatchi & Saatchi and Bates Worldwide, Zenith handles media in a variety of categories in both consumer and trade communications. 2. Media Organizations The world of media is vast and constantly changing. Many media giants own properties in several media categories, and are major forces in the world of advertising. Visit the websites for the following media companies and answer the questions below. 164 a. b. c. d. Advo Inc. (www.advo.com) Cox Enterprises (www.cox.com) Gannett (www.gannett.com) McGraw-Hill (www.mcgraw-hill.com) NyNex (www.nynex.com) AOL/Time-Warner (http://www.timewarner.com/) Tribune Communications (www.tribune.com) Turner Entertainment Group (www.turner.com) Viacom (www.viacom.com) Who is the intended audience of the site? What is the size/scope of the organization? What is the organization’s purpose? The site’s purpose? How important is this organization to the advertising industry? Why? Sample Answer: Turner Broadcasting a. The intended audience of the site consists of both consumers who watch the company’s programming as well as major advertisers and investors. b. The organization is worldwide. c. Turner is in business to provide television programming via one of its six major cable networks to consumers around the globe. The site’s purpose is to provide information and programming guides about each of the networks and Turner Broadcasting. d. This is a very important organization to advertisers because if its large volume and control in cable networks. IMPORTANT TERMS advertising impression, 280 advertising response curve, 284 attention value, 294 audience, 293 audience objectives, 278 blinking, 296 brand development index (BDI), 287 bursting, 296 category development index (CDI), 287 circulation, 280 continuity, 283 continuous schedule, 296 cost efficiency, 295 cost per point (CPP), 295 cost per thousand (CPM), 294 gross impressions, 280 gross rating points (GRPs), 281 markets, 285 mechanics, 286 media, 285 media planning, 269 media vehicles, 279 message weight, 280 methodology, 286 mixed media approach, 295 money, 285 motivation value, 294 opportunity to see (OTS), 280 pulsing, 296 rating, 281 165 creative mix, 278 distribution objectives, 279 effective frequency, 283 effective reach, 283 exposure value, 293 five Ms, 285 flighting, 296 frequency, 282 reach, 281 readers per copy (RPC), 280 recency planning, 284 roadblocking, 296 spillover media, 289 synergy, 296 television households (TVHH), 281 ANCILLARY ACTIVITIES & EXERCISES As a method for getting students to take a closer look at media scheduling, have them study the media flowchart for American General Telecom in Chapter 9 on page 297. Have them review the chart and identify the various types of media scheduling, such as flighting, pulsing, etc. (described in Exhibit 9-16, p. 297). DEBATABLE ISSUE Is Impact More Important than Consistency? Few advertisers have as much money to spend on advertising, as they would like. Budget limitations are especially difficult for many local advertisers. The dilemma they often face is whether to advertise less frequently with large-space advertisements so as to generate impact, or whether to advertise more frequently with small-space advertisements so as to achieve consistency. PRO Impact is more important than consistency because... The small or local advertiser can vie more effectively with competitors by using large-space ads that attract attention and give the advertiser an aura of size and prominence. A large ad has greater reach because more people see it. Since many more items can be shown in a large ad, it is a more economical use of space. Small-space ads often get buried, so consistency is not necessarily achieved. Large-space ads can accommodate more advertising copy. They communicate more about the product or service, and in greater depth, than do small-space advertisements. Image is very important to most advertisers. You cannot create or convey much of an image in a small-space ad. Most such ads are about as effective as directory listings. In contrast, largespace ads can transmit image, power, and dynamics that impress the reader and make the ad memorable. CON Impact is not more important than consistency because... The only way to achieve long-term recognition and brand acceptance in the marketplace is through continuous media exposure. This can be attained only by advertising consistently. 166 Small-space ads afford the opportunity to advertise a larger number of items over a longer period of time. It is better not to spend your budget on just a few large ads and then have no follow-up ads to sustain their impact. Some of the most beautiful and creative ads are relatively small in size. Copy need not be lengthy to say a great deal or to be effective. Billboard copy is a good example of this. Consistency is important since not all readers are as apt to buy on one day as on another. If you do not advertise consistently, you may miss delivering your message when readers are most inclined to buy. Retail stores display their business signs not just occasionally, but all the time. The same must be true for advertisers. Questions 1. For what types of products do you feel consistency is especially important? 2. For what types of products do you feel impact is especially important? 3. What other points, pro and con, can you add to the above arguments? 4. Which side of this issue do you agree with most? Explain. IMAGES FROM THE TEXT Images are available as color acetates through your local McGraw-Hill/Irwin sales representative. A9-1 A9-2 A9-3 A9-4 A9-5 A9-6 A9-7 A9-8 A9-9 Exhibit 9-1 Exhibit 9-9 Exhibit 9-10 Exhibit 9-11 Exhibit 9-12 Exhibit 9-14 Exhibit 9-15 U.S. ad spending by medium (p. 271) Random combination table (p. 282) Reach, frequency, and continuity graph (p.283) Two advertising response curves (p.284) Kinko’s ad (p.285) Media buyers compare brand development (p. 288) Godiva ad (p.291) Effect of size and color on ad readership (p. 291) Three ways to schedule the same number of total GRP’s (p. 296) 167 REFERENCE LIBRARY Located on the McGraw-Hill Contemporary Advertising website: www.mhhe.com/arens04 RL 9-1 RL 9-2 Guidelines for determining reach, frequency, continuity and pulsing combinations. Comparative evaluation of advertising media. 168