Step 4: Media Metrics and Analytics
Media plans are driven by questions of accountability. And because media
decisions are based on measurable factors, identifiable costs, and budget
limitations, media planners are engrossed in calculating the impact and efficiency
of their media recommendations.
Impact: GRPs and TRPs
Among the most important tools media planners use in designing a media mix is a
calculation of a media schedule’s gross rating points and targeted rating points.
Reach and frequency are interrelated concepts that, when combined, generate an
estimate called gross rating points. Gross rating points, or GRPs, indicate the
weight, or efficiency, of a media plan. The more GRPs in a plan, the more
“weight” the media buy is said to deliver.
To find a plan’s GRPs, you multiply each media vehicle’s rating by the number of
ads inserted into each media vehicle during the designated time period and add up
the total for the vehicles. Once the media vehicles that produce the GRPs have
been identified, computer programs can be used to break down the GRPs into
reach and frequency (R&F) numbers. These R&F models are based on consumer
media use research and produce data showing to what extent audiences, viewers,
and readers overlap.
A good media planner will look at several different mixes of programs that reach
the target audience, figure the GRPs for each, and then break this calculation into
R&F estimates for each plan. While gross rating points include exposure
duplication, knowing the GRPs of different plans is still helpful in choosing which
plan delivers more for the money budgeted.
How do you decide which is best? If a brand has a tightly targeted audience and
wants to use repetition to create a strong brand presence, then a plan that has a
higher frequency would be important. If a brand has a fairly simple message
where frequency is less important, a planner would probably choose a plan with
higher reach.
Principle: Reach and frequency are interrelated: when reach increases,
frequency decreases, and vice versa, within the constraints of the advertising
budget.
For products that have a mass-market appeal, households are often used in
targeting. However, for more specialized products, target audiences can be more
narrowly defined. Since the total audience obviously includes waste coverage, the
estimate of targeted rating points (TRPs) adjusts the calculation to exclude the
waste coverage so it more accurately reflects the percentage of the target audience
watching a program. Because the waste coverage is eliminated, the TRPs are
lower than the total audience GRPs. Targeted rating points are determined by
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media usage research data, which is available from syndicated research services
like MRI and from the major media vehicles themselves.
Another reason to tightly describe a target audience, especially in terms of
lifestyle, is to take advantage of the many media vehicles such as magazines, TV
programs and channels, and special events that connect with various types of
lifestyles.
As important as ratings have been in traditional media plans, this computation
may not be as important with individual contact media used by social and mobile
advertising. It’s the nature of the engagement rather than the breadth of the
exposure that determines the effectiveness of the media impact.
New media plans also are substituting GRPs with something called total audience
impressions, which are designed to better estimate the impact of an integrated
campaign—including digital impressions as well as those delivered by measured
media. Total audience impressions are derived from impression management
efforts in public relations. These new methods attempt to do a better job of
estimating the impact of multiplatform campaigns.
Cost Efficiency
As mentioned earlier, one way to compare budgets with the competition is called
share of voice. It sets the budget relative to your brands and your competitors’
market share. For example, if your client has a 40 percent share of the market,
then you may decide to spend at a 40 percent share of voice in order to maintain
your brand’s competitive position. To calculate this budget level, you need to find
the total ad spending in your category, as well as the share of market owned by
your brand and your key competitors. For example, if the category ad spending
totals $10 million, and you want your share of voice to be 40 percent, then you
would need to spend $4 million.
At the end of the planning process, after the media mix has been determined, the
media planner will prepare a pie chart showing media allocations, a term that
refers to allocating the budget among the various media chosen. The pie chart
shows the amount being spent on each medium as a proportion of the total media
budget. The pie chart visualizes the media mix and the relative importance of each
vehicle in the mix.
It is useful to note that the other IMC disciplines are also concerned about proving
their efficiency. The A Matter of Practice feature located in this chapter explains
how important it is to integrate not only media planning, but also evaluations of
efficiency, comparing these other areas with advertising media planning. The
concept of earned media, in contrast to purchased and measured media is also
introduced.
CPMs, TCPMs, and CPPs
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Sometimes media decisions are based on cost. Advertisers compare the cost of
each proposed media vehicle with the specific vehicle’s ability to deliver the
target audience. The cheapest vehicle may not deliver the highest percent of the
target audience, and the highest priced vehicle may deliver exactly the right target
audience, so the selection process is a balancing act between cost and reach.
The process of measuring the target audience size against the cost of reaching that
audience is based on calculations of efficiency, cost per thousand (CPM) and cost
per point (CPP). Cost per thousand is the cost to expose 1,000 audience
members to an ad message. CPM is used when comparing the cost of vehicles
within the same medium. It is also important to base it only on the portion of the
audience that has the target characteristics. This is called targeted cost per
thousand (TCPM).
Some planners prefer to compare media on the basis of rating points instead of
impressions. Although both efficiency calculations are used, many planners favor
cost per point(CPP) because of its simplicity.
Both the CPM and the CPP are relative values. Although we can use these
efficiency analyses across media, we make such comparisons carefully. CPM and
CPP are more valid when used to compare vehicles within a medium. Media
planners are constantly balancing cost with audience characteristics to decide if
the media vehicle makes sense given the target audience size and characteristic.
Media Optimization
Tools that help estimate the most optimum use of various media plans using
computer models involve calculating the weight of a media schedule and
optimizing the schedule for the greatest impact. These optimization techniques
enable marketers to determine the relative impact of a media mix on product sales
and optimize the efficiency of the media mix.
Generally the models can create an unlimited number of media combinations and
then simulate the sales produced by each. Using optimization models, the media
planner can make intelligent decisions, given factors such as budget, timing, and
so forth. The issue of media optimization, however, is bigger than just numbers
and estimates of efficiency. It also involves questions of media overload and
consumer irritation.
How Do Media Buying And Negotiation Work?
Once the plan directions are set, media buyers convert objectives and strategies into
tactical decisions. They select specific media vehicles and negotiate and contract for the
time and space in media. A media buyer has distinct responsibilities, as outlined in Figure
14.5.
Media Buying Basics
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Buying is a complicated process. The American Association of Advertising Agencies
lists no fewer than 21 elements of a media buy. The most important one, however, is
matching the media vehicle to the strategic needs of the message and the brand.
Following is a discussion of the most important media buyer activities.
Providing inside information
Media buyers are important information sources for media planners. They are close
enough to day-to-day changes in media popularity and pricing to be a constant source
of inside current information.
Principle: Media buyers should be consulted early in planning as they are a good
source of information on changes in media.
Selecting media vehicles
The media planner determines the media mix, but the buyer is responsible for
choosing the specific media vehicles.
Online media buying is usually handled through ad networks and the big portals.
AOL, Yahoo!, Google, and Microsoft are four of the five biggest online ad networks,
and the Microsoft Media Network is the fastest-growing service. Online vehicles are
also offering programmatic buying, which means that algorithms are used to target
individual viewers, not just aggregated audiences based on their digital tracking data.
Armed with the media plan directives, the buyer seeks answers to a number of
difficult questions as various media vehicles are considered. Does the vehicle have
the right audience profile? Will the program’s current popularity increase, stabilize, or
decline? How well does the magazine’s editorial format fit the brand and the message
strategy (see the V8 example)? The answers to those questions bear directly on the
campaign’s success.
Negotiation Costs
A media buyer negotiates for the best prices. The key questions are whether the
desired vehicles are available and whether a satisfactory schedule and rates can be
negotiated. Aside from finding the aperture of target audiences, nothing is more
crucial in media buying than securing the lowest possible price for placements. In
buying network television time, typically about 80 percent of the prime-time
inventory is presold at a negotiated discount rate for the upcoming season during the
up-front market. Networks sell the rest of their inventory in the scatter market,
which means that the buys are made closer to the date.
Every traditional medium has a published rate card, but media buyers often negotiate
special prices for volume buys. The buyer must understand the trade-off between
price received and audience objectives. Here are some other negotiation
considerations:
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Bargaining for preferred positions: The locations in print media that offer
readership advantages. How many additional exposures might that ad get?
Because they are so visible, preferred positions often carry a premium
surcharge, usually 10 to 15 percent above standard space rates.
Demand extra support offers: Buyers often demand additional promotional
support called value-added media services. These can take any number of forms,
including contests, special events, merchandising space at stores, displays, and
trade-directed newsletters. The “extra” depends on what facilities each media
vehicle has and how hard the buyer can bargain.
Monitoring Performance
A media buyer’s responsibility to a campaign does not end with the signing of space
and time contracts. The media buyer is responsible for tracking the performance of
the media plan as it is implemented, as well as afterward, as part of the campaign
evaluation. Buyers must also fix problems. Poorly performing vehicles must be
replaced, or costs must be modified.
Buyers also check the publication issues to verify whether advertisements have been
placed correctly. Buyers make every attempt to get current audience research to
ensure that schedules are performing according to forecast. Media buyers are even
found out “riding the boards,” which means they check the location of the outdoor
boards to verify that the client is receiving the outdoor exposure specified in the plan.
Here are other responsibilities of media buyers:
Post-campaign evaluation: Once a campaign is completed, the planner’s duty is
to compare the plan’s expectations and forecasts with what actually happened.
Monitor billing and payment: Ultimately, it is the responsibility of the advertiser
to make payment for the various media. However, the agency is contractually
obligated to pay the invoice on behalf of the client. Keeping track of the invoices
and paying the bills is the responsibility of the media buyer in conjunction with
the accounting department.
Another complexity is the growth of online media, most of which call for entirely
different media-buying techniques. The basis for the buy includes such new measures
as click-throughs, and the data are monitored through services such as Nielsen Net
Ratings and comScore. Google provides analytic data for search users as well as new
or repeat viewers and time spent on the site. The Practical Tips feature in this chapter
provides additional ideas on how to buy interactive media.
Media buyers also have to deal with situations that crop up and complicate the
planning. They are also troubleshooters. Temporary snags in scheduling and
production are sometimes unavoidable. A policy of compensating for such errors is
called “making good on the contract,” known as make goods. Here are some
examples:
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Program preemptions: Special programs or news events often interrupt regular
programming and the commercial scheduled is also interrupted. In the case of
long-term program preemptions, such as war coverage, buyers may have
difficulty finding suitable replacements before the schedule ends
Missed closings. Magazines and newspapers have clearly set production
deadlines, called closings, for each issue. Sometimes the advertising materials
do not arrive in time. If the publication is responsible, it will make good. If the
fault lies with the client or the agency, there is no restitution by the
publication.
Technical problems. Technical difficulties are responsible for numerous goofs,
glitches, and foul-ups that haunt the advertiser’s schedule. Bleed throughs
(the printing on the back side of the page is visible and conflicts with the
client’s ad on the front side) and out-of-register colors (full-color printing is
made from four color plates, which sometimes are not perfectly aligned). For
newspapers, torn billboard posters, broken film, and tapes out of alignment are
typical problems.
Multichannel Buying (and Selling)
It should be clear from this review of media buyers’ responsibilities that this is a
challenging job. A number of media services are available to help make buying for
complicated media plans easier. General Electric and NBC Universal, for example,
promoted media opportunities using a multichannel plan that includes broadcast,
cable, and the Internet, as well as original programming on its own channels.
Newspapers have long offered simplified buys through such companies as
Nationwide Newspapers and can handle classified and display advertising in more
than 21,000 newspapers. The Newspaper National Network is a trade association
representing some 9,000 newspapers that also handles ad placement.
In the digital world, DoubleClick’s DART for Advertisers service helps advertisers
manage online display and search marketing campaigns across online channels. All of
these services not only place ads but also provide performance data to help optimize a
buy as well as report on the effectiveness of a marketer’s specific plan.
The cross-media buy, which is made easier by media companies, sells combinations
of media vehicles in a single buy. This approach makes it easier to buy media across
all of these platforms with a single deal rather than six phone calls. These multi-
channel deals are a result of media convergence. As content moves across these
various forms of new media, so does advertising. Giant media groups, such as
Viacom and Disney, are packaging “deals” based on the interests of the target
audience.
Global Media Planning
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A true global medium does not currently exist, which means that global media plans
have to piece together worldwide coverage using a variety of media tools. No one
network controls this global transmission.
The definition of global media buying varies widely, but everyone agrees that few
marketers are doing it yet. However, many are thinking about it, especially computer
and other information technology companies that are being pursued by media such as
AT&T.
Today, the growth area is media buys across a single region, but as media becomes
more global some marketers are beginning to make the leap across regions.
Satellite transmission now brings advertising into many homes, but its availability is
not universal because of the footprint (coverage area of the satellite), technical
limitations, and regulations of transmission by various governments. Satellites beam
signals to more than one country in Europe, the Asian subcontinent, North America,
and the Pacific, but they are regional, not global, in coverage.
The North American, European, Asian, and Latin American markets are becoming
saturated with cable TV companies offering an increasing number of international
networks. But an advertiser seeking global exposure must still deal with different
networks and different vehicles in different countries.
In Europe, the rise of buying “centrals” came about with the emergence of the EU and
the continuing globalization of trade and advertising. Buying centrals are media
organizations that buy across several European countries. These firms have flourished
in an environment of flexible and negotiated rates, low inflation, and a fragmented
advertising market.
The important thing, however, is to be able to consider cultural implications in media
use. For that reason, media planning and buying companies are also specializing in or
buying companies that understand specific cultures, such as the Hispanic market in
the U.S. and the Chinese market in Asia.
Media Planning and Buying Trends
Advertising experts have been proclaiming the demise of mass media advertising for a
number of years. The media landscape is dynamic and changing so fast that it’s hard to
keep track of how the media business is practiced. All of these changes create new ways
of operation and new opportunities for innovative media planners and buyers.
Unbundling Media Buying and Planning
Occurring in the media industry is a shift in the way the industry is organized. This
shift is called unbundling media services. Because media companies can aggregate
the buying function across many different clients, that enables them to negotiate
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better rates for their clients. Because these companies control the money, they have
become a powerful force in the advertising industry, leading to a tug-of-war over
control and planning.
Some of these media companies are now offering consolidated services, which
means bringing the planning and buying functions back together. To take advantage
of this consolidation argument, some media companies are also adding special
planning teams for other related areas, such as events, product placement, Internet,
and guerilla marketing programs.
Online Media Buying
A bigger threat to agencies than media buying services comes from Google and
Yahoo!, which, although not ad agencies, are making inroads into media buying and
selling. Google is using its website to sell ads primarily to small advertisers and
publishers who find its automated advertising network, Google Adworks, to be a
cost-effective way to connect with one another. Agencies are trying to figure out if
Google and Yahoo! are friends or enemies and what their move into online media
buying will do to the revenue stream. Google, however, is betting that its expertise in
search advertising, which matches ads to user interests, will give it an advantage over
traditional ad media services.
New Forms of Media Research
One challenge mediaplanners face is the lack of reliable audience research and
measurement metrics for the new media. The metrics for online media – hits and
clicks – don’t really tell us much about impact, and comparing TRPs and clicks is like
comparing apples and oranges.
Search advertising on the Internet is also complicating things because, if it’s
successful, it steals viewers away from the original site. So, search advertising may
make sense as a form of direct marketing, but it is a nightmare for content publishers
who sell advertising on their pages.
Viral marketing is equally difficult to measure. Analytic data helps media planners
assess the impact of the video-sharing site. Viral monitoring services have been
established to assess the impact of YouTube and other multiple online platforms. As
such services mature, marketers will become smarter about selecting marketing
communication messages with the most viral video potential.
Another problem is that media research is based on each medium as a silo, that is,
separate studies for separate media. Most of the research services are unable to tell
you much about the effectiveness of multiplatform media programs.
E ND-OF-CHAPTER SUPPORT
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