Copyright © 2012 Pearson Canada Inc. Chapter 9 Broadcast Media: Television and Radio 9-1

Copyright © 2012 Pearson Canada Inc. Learning Objectives  Identify the organizations involved in the Canadian broadcasting industry  Assess the advantages and disadvantages of television and radio as advertising media  Explain the factors considered in, and procedures used, for buying television and radio time  Identify recent technologies affecting commercial television and radio in Canada 9-2

Copyright © 2012 Pearson Canada Inc. The Canadian Television Market  Television and radio reaches 99% of Canadian households.  90% of households have satellite or cable TV.  On an average day, 82% of Canadians view television at least once. 9-3

Copyright © 2012 Pearson Canada Inc. Television Market The television market is divided between:  National Networks  e.g., CTV – 18 stations  Regional Networks  CTV operates regional networks in Ontario, Atlantic Canada, and Saskatchewan  Specialty cable channels  TSN, MuchMusic, History Channel  Pay TV  Digital Networks 9-4

Copyright © 2012 Pearson Canada Inc. Trends Affecting Television and Television Advertising The landscape of the Canadian Television industry is changing.  Commercial Avoidance and Personal Video Recorders  Audience Fragmentation  Alternative Viewing: Video-on-Demand  Mobile Media  Convergence of media ownership 9-5

Copyright © 2012 Pearson Canada Inc. Television Viewing Highlights  Media-viewing data is collected by two organizations in Canada: BBM Bureau of Measurement and Nielsen Media Research  A valuable resource for advertisers to assess advertising costs and for identifying what programs are popular.  Ratings are audience estimates expressed as a percent of the population in a defined geographic area. 9-6

Copyright © 2012 Pearson Canada Inc. Time Spent with Television and Other Media 9-7

Copyright © 2012 Pearson Canada Inc. Advantages of Television Advertising  Impact & Effectiveness of Messages  Demonstration Capability  High Reach  Frequency Potential  Some Demographic Selectivity  Some selectivity for geographic coverage 9-8

Copyright © 2012 Pearson Canada Inc. Disadvantages of Television Advertising  High Cost  Limitations on target-market selectivity  Audience Fragmentation  Commercial Avoidance  Lack of Planning Flexibility 9-9

Copyright © 2012 Pearson Canada Inc. Television Advertising Alternatives  Network Advertising  National Spot (Selective spot) Advertising  Sponsorships Opportunities  Product Placement and Branded Content  Station specific Advertising for local businesses 9-10

Copyright © 2012 Pearson Canada Inc. Television Ad Rates and Buying Procedures  Supply and Demand  Nature of Advertising Purchase  Type of Programs  Dayparts (Time of Day)  Length of Commercial 9-11

Copyright © 2012 Pearson Canada Inc. Buying Television Time Media buying in television is a complex process. National and Regional Networks  Supply and demand system = grid card with varying price levels  Spot rates depend upon daypart, audience size, and time of year. Local-Market Television Rates  Offer continuity discount for 52-week contracts.  Commercials are rotated vertically through the day, and horizontally during the week Gross Ratings Points are a key metric 9-12

Copyright © 2012 Pearson Canada Inc. Discounts Offered by Television  Frequency  Volume  Continuity  Seasonal  Package Plans  ROS (Run Of Schedule)  Pre-emption Rates 9-13

Copyright © 2012 Pearson Canada Inc. Media Optimizers  New optimizing software technology is playing a much bigger role in buying more efficient advertising time on TV.  An optimizer searches the TV-ratings database for daypart or program combinations that increase target reach (or reduce the cost of buying it) 9-14

Copyright © 2012 Pearson Canada Inc. The Canadian Radio Market  649 commercial radio stations in Canada  184 are AM (amplitude modulation)  465 are FM (frequency modulation)  Average adult spends about 19 hours/week listening to radio  Radio broadcasting is divided between  Canadian Broadcasting Corporation (government funded)  Independently owned and operated stations dependent on advertising revenues 9-15

Copyright © 2012 Pearson Canada Inc. Trends Influencing the Radio Industry Trends Influencing the Radio Industry:  Digital Radio (e.g. CBC)CBC  Internet Radio (e.g. 3wk.com)3wk.com  Satellite Radio (e.g. Sirius Canada)Sirius Canada  Ipods and other Portable devices (e.g. iTunes)iTunes 9-16

Copyright © 2012 Pearson Canada Inc. Radio Listening Highlights Conventional Radio are transmitted two ways:  AM – varying the height of radio waves  FM – varying frequency of radio waves Tuning Hours:  Average listener tunes in hours a week  Teens spend 8 hours on iPods, cell phones, and Internet, which are more attractive to them  Radio is more popular in the morning, when people wake up or travel to work 9-17

Copyright © 2012 Pearson Canada Inc. Radio Station Formats Radio audiences are largely determined by a station’s format (type and nature of the programming)  Adult Contemporary  Golden oldies  Country  News/Talk  Contemporary Hit Radio (CHR) 9-18

Copyright © 2012 Pearson Canada Inc. Pros and Cons of Radio Advertising AdvantagesDisadvantages  Target-Market Selectivity  Reach Potential  Frequency  Modest Cost for placement and production  Flexibility  Audience Fragmentation  Low engagement  Limited Message Retention  Media-Planning Consideration 9-19

Copyright © 2012 Pearson Canada Inc. Radio Advertising Rates and Buying Procedures  Seasonal Rate Structures  Dayparts  Reach Plans  Type of Advertiser 9-20

Copyright © 2012 Pearson Canada Inc. Radio Discounts Number of spots over a specified period of time Frequency Volume Continuity Large number of spots For a contract that covers a specified period of time Continued… 9-21

Copyright © 2012 Pearson Canada Inc. Radio Discounts (cont.) Purchase a minimum weekly number of spots in return for a packaged discount rate Package Plans Combination Run-of-Schedule If they air commercials on more than one station If allowed relocate commercials through schedule at its own discretion 9-22

Copyright © 2012 Pearson Canada Inc. Buying Radio Time Factors that have an impact on the spot rate:  Volume  Frequency (the total number of spots in a buy)  Timing (in terms of day or season)  Continuity (length of the plan) 9-23

Copyright © 2012 Pearson Canada Inc. Buying Radio Time Rotation Plans  Vertical Rotation  Horizontal Rotation Reach Plan (Total Audience Plan)  The rotation of commercials through dayparts based on predetermined frequency at the discretion of the station. 9-24

Copyright © 2012 Pearson Canada Inc. Radio Rate Card 9-25