Media Buying Lots of Questions Who am I

Media Buying

Lots of Questions Who am I trying to reach? How many can I afford to reach? How often do people need to encounter my message? In which vehicles should I pursue message space? When should I communicate (day, week, month, year)? What markets and regions should receive extra emphasis and which ones can be ignored? How can I take advantage of emerging media?

Media Selection Procedures Selection based on audience and costs • What does your target consume? • How much can you afford? Audience measures • Gross impressions & Gross rating points (GRPs) • Reach & Frequency - How many and how often • Cost per thousand (CPM) and Cost per point (CPP)

Gross Impressions In media, primarily concerned with accumulation of audience Each audience member exposed to the message is considered an “impression” • Summed to equal “gross impressions” • Audience size = gross impressions for single show • For multiple programs, add audience sizes together for total gross impressions (GI)

Gross Rating Points Same logic applies to rating points Rating for individual programs are added together to calculate the total rating points accumulated across a schedule Gross Rating Points = GRPs Ex. Rating for Program 1 + Rating for Program 2 + Rating for Program 3 Gross Rating Points

GI and GRPs Gross impressions (GI) • Total number of exposures - duplication counts • Exposures (Ad 1) + Exposures (Ad 2) + Exposures (Ad 3)…. • 2 ads in American Idol each generate 9. 63 Million impressions + NCIS: Los Angeles generated 7. 98 Million Impressions Total impressions = 27. 24 Million or 27, 240, 000 GIs Gross rating points (GRPs) • GRPs = GI / Total population (x 100 to convert to %) • Can be over 100, and often is 2. 78 rating + 1. 44 rating = 7. 00 GRPs • Way of allocating media weight

Media Schedules Rating NCIS 21. 3 Am Idol 23. 9 Big Bang 10. 6 Olympics 5. 8 Total --- Aud. Size 22. 5 mm 25. 2 mm 11. 2 mm 6. 1 mm --- # of Ads 3 2 4 1 10 GRPs GI 63. 9 67. 5 mm 47. 8 50. 4 mm 42. 2 44. 8 mm 5. 8 6. 1 mm 159. 7 168. 8 mm

Huh? Your schedule generates 168. 8 mm HH GI yet there are only 105. 5 mm TV HH • How is this possible? Your schedule generates 159. 7 GRPs, with each GRP equal to 1% of the audience • How can you have more than 100%

Duplication of Impressions GRPs and GI allow for the duplication of impressions • Someone might see more than one ad in your schedule Ex. NCIS and Am Idol Ex. multiple episodes of Am Idol Ex. multiple ads in a single show

Reach and Frequency Percent of audience exposed at least once • Overall - Household reach • Target - Reach of specific audience Average Number of times exposed • Average frequency x Reach = GRP

Reach and Frequency GRPs = Viewers Counted Once GRPs = Reach X X Average Number of Times They View Frequency Reach is net unduplicated audience Frequency is average number of exposures

Estimating Reach and Calculating Frequency Back to our 10 unit schedule of ads • GRPs = 159. 7 • Reach = 60. 0 • Frequency = 2. 66 or 2. 7 • Numbers comes from “reach curves” that contain reach estimates for various media vehicles and GRP levels • Frequency is then calculated from reach

Frequency Distribution

Effective Frequency Combines reach and frequency Threshold: minimum effective frequency • Usually 3+ • Ideal exposure frequency Varies by message complexity Varies by strategic goals

Cost Efficiency Cost in relation to target delivered • Cost per thousand (CPM) • Cost per rating point (CPP) CPP used to compare efficiency of advertising media to one another

CPM = Cost per thousand impressions CPM = Cost of ads / Total GIs in (000) • Ex. CPM for NCIS • CPM = $400, 000 / 22, 500(000) = $17. 78 • Ex. CPM for 10 unit schedule • CPM = $2, 450, 000 / 168, 800(000) = $14. 51

CPP = Cost per rating point CPP = Cost of ads / Total GRPs • Ex. CPP for NCIS • CPP = $400, 000 / 21. 3 = $18, 779. 34 • Ex. CPP for 10 unit schedule • CPP = $2, 450, 000 / 159. 7 = $15, 341. 26

Media Vehicle Selection Note the size of the media budget. Determine which media vehicles to use – Choices + Primary Research Decide how to use media in line with segmentation, relationship marketing, database/interactive, and connections planning Decide “impact media” – newspapers, internet, outdoor, and specials Allocate impact media and subtract cost from available media budget Allocate percent of the remaining media budget to a medium • ex. 5% on “evening drive time” radio or 20% on “prime time” network TV Divide amount allocated by Cost-Per-Point (CPP). Calculate your total Gross Rating Points (GRPs). Distribute the GRPs across the year, distinguishing national from spot

Simple Example Total media budget is $54, 836, 200. Buy two ads on Academy Awards (2 X $39, 610 X 25 = $1, 980, 500), six ads in College Bowl Games (6 X $35, 674 X 25 = $5, 351, 100), two ads on the Super Bowl (2 X $59, 376 X 50 = 5, 937, 600) and two months of outdoor in top 50 spot markets (2 X 1, 600, 000 = $3, 200, 000). • Total Spending on impact media = $16, 469, 200. • Amount remaining = $38, 367, 000 Decide to spend 35% of remaining budget on local primetime TV. • . 35 X 38, 367, 000 = 13, 428, 450 • 13, 428, 450/ 27, 407 CPP = 490 rating points. Place 100 in March, place 70 in May (Summer Kickoff), place 70 in October (Fall Promotion), and 250 in December (Winter Sales Event). Repeat process for other media (Radio, Magazines, etc). Diagram media buys, both impact and standard media, in a flowchart.