Copyright © 2006 Thomson Business and Economics. All rights reserved. Chapter 14 Media Strategy and Planning for Advertising and IBP

14–2Copyright © 2006 Thomson Business and Economics. All rights reserved. The Transition to Part 4: Placement Starting to study the “placement” phase of advertising and IBP. –Focus is on using media and promotions that “reach” the target audience. –Even a great message will be ineffective if it does not reach the proper audience.

14–3Copyright © 2006 Thomson Business and Economics. All rights reserved. Introductory Scenario: Media Transitions The 2003 SuperBowl attracted twice as many viewers as the 1967 SuperBowl but cost 10 times as much. Advertisers are looking to more and different media to effectively reach target audiences.

14–4Copyright © 2006 Thomson Business and Economics. All rights reserved. The Very Wide World of Promotional Media—Important Changes [1] Agency Compensation –15 percent commission is gone Most clients now pay on a fee-for-service basis Ad creation and placement not at same agency More Media –Traditional media lines are blurred Firms push “news” stories into media Movies can be promotional vehicles

14–5Copyright © 2006 Thomson Business and Economics. All rights reserved. The Very Wide World of Promotional Media—Important Changes [2] Consolidation and Shifting Channel Power –Many agencies are now larger than their clients –Big agencies hold power due to buying media in quantity Thinner Margins/Thinner Shops –Despite size, agency profit margins are smaller –Fewer people working more hours –Publicly-traded companies seek bottom line

14–6Copyright © 2006 Thomson Business and Economics. All rights reserved. The Very Wide World of Promotional Media—Important Changes [3] Greater Accountability: –Return on Investment (ROI) –Trust used to be basis for relationships –Other forms of media produce more measurable results than mass media Globalization –Today media exist in a transnational space –Lack of standardized measurement makes pricing complex.

14–7Copyright © 2006 Thomson Business and Economics. All rights reserved. The Very Wide World of Promotional Media—Important Changes [4] Free Content –Internet information has consumers accustomed to free content –Why buy a magazine full of ads for $4.50? –Nontraditional media attracting more dollars E-Commerce/E-Media –Revolutionized the way consumers consume. –Consumers have more power in the transaction due to deal-proneness and price/cost transparency.

14–8Copyright © 2006 Thomson Business and Economics. All rights reserved. The Very Wide World of Promotional Media—Important Changes [5] Hyper-Clutter –Worse than ever on TV and in magazines –Consumers choosing no-ad channels/satellite radio Ethnic Media –Ethnic media grows as ethnic population grows –Hispanic/Latin/Latino market growing fastest –Asian market next fastest growing

14–9Copyright © 2006 Thomson Business and Economics. All rights reserved. Media Planning Media Plan –Specifies media in which an advertising message will be placed to reach a desired audience Media Class –Broad category of media—TV, radio, newspapers Media Vehicle –Specific option within a class (e.g., Vogue) Media Mix –Blend of different media to reach target audience

14–10Copyright © 2006 Thomson Business and Economics. All rights reserved. The Media Plan Target Audience Media Strategies Reach the target audience Geographic scope of placement Message weight Media Strategies Reach the target audience Geographic scope of placement Message weight Media Choice Media efficiency (CPM, CPRP) Media Choice Media efficiency (CPM, CPRP) More Media Strategies Reach and frequency Continuity Audience duplication Length/size of advertisements Media context More Media Strategies Reach and frequency Continuity Audience duplication Length/size of advertisements Media context

14–11Copyright © 2006 Thomson Business and Economics. All rights reserved. Media Strategies [1] Reach the target audience Demographic, geographic, lifestyle / attitude define choices Single-source tracking services help identify effect of placements Geographic scope of media placement Distribution area determines media choice Geo-targeting of regions of high-purchase density Message weight Gross impressions, message impressions Between-vehicle / within-vehicle duplication

14–12Copyright © 2006 Thomson Business and Economics. All rights reserved. Media Strategies [2] Reach and Frequency –Gross rating points (GRP) –Effective frequency –Effective reach Length or Size of Ads –Creative requirements –Media budget –Competitive environment Continuity – Continuous scheduling – Flighting – Pulsing Media Context –Editorial climate/tone of media vehicle

14–13Copyright © 2006 Thomson Business and Economics. All rights reserved. Media Choices: Media Efficiency CPM = cost of media buy total audience X 1000CPM-TM = cost of media buy targeted audience X 1000CPRP = $$$ for a program placement program rating

14–14Copyright © 2006 Thomson Business and Economics. All rights reserved. The Real Deal Data Quality –Cultural hang-up on numbers –Media exposure is not a good measure of ad impact –Firms are seeking alternatives to Nielsen Ads for Advertisers –Media firms use ads to attract advertisers The Media Lunch –Media is more than a numbers industry –Personal relationships are still pursued

14–15Copyright © 2006 Thomson Business and Economics. All rights reserved. Contemporary Essentials [1] Internet Media –Growth in use but not in rates –Difficulty in assessing size of audience –Hard to determine what kinds of “ads” really work on the Internet Competitive Media Assessment –Assessment of how competitors are spending –Share of Voice is measure of one advertiser’s expenditures vs. others –Important when competitors are all focused on one narrow segment

14–16Copyright © 2006 Thomson Business and Economics. All rights reserved. Contemporary Essentials [2] Computer Media-Planning Models –Major firms offer data bases –Data is not standardized across media –Allows for wide range of possible buys Making the Buy –Securing electronic and print media space –Agency of Record purchases space –Some firms use a Media Buying Service Interactive Media –Reach beyond television or kiosks Includes telephones, cds, online –Will consumers spend less time with traditional media?

14–17Copyright © 2006 Thomson Business and Economics. All rights reserved. Media: IBP Implications 1.Reliance on mass media will be reduced for more highly targeted vehicles. 2.Media impact data will used to compare placement alternatives. 3.Planners will become more knowledgeable about alternative media choices. 4.Central control will help to seamlessly integrate multiple media.