Advertising Budgeting, Media, and Media Planning

The Advertising Budget

Setting the Budget
Percentage of Sales Need-based Plan Competitive Budgeting The Task or Objective Method

Whats the objective? What type and how much media needed? Can we afford it?

Arbitrary

Administering and Protecting the Budget

Organization of the Media Function

Media planner Media buyer Media researcher

Challenge
Household PDAs

Branded Sceens

Viral Mail

The
Branded Games

Viral Marketing

Elevator Advertising

Mobile Mkt.

Telemarketing Fax Mail iTV Customer Service PDAs

Point of Sale Face-to-Face

Radio

Branded Mobile Phone Sites

Delivery Fulfillment

Event/ Sponsorships

Media Opportunities Idea

Placement/ Product Sampling Newsprint

Television PVRs

Magazines

Outdoor Full-page Banners

Telematics

Banner Ads

Screens on Exercise Bikes

Branded Web Content Branded CDs

Image Content Scanner

Bar Code Scanner

Communication
Roger Sperry, the Nobel Prize laureate, introduced the concept of the two hemispheres of the brain, with their very specific functions:

Text

Intuition

Language Simultaneous comprehension

Abstraction

Linearity

3-dimensionality

Communication
Still images
Text

The best communication stimulates both side of the brain.

Moving
Intuition

Language Simultaneous comprehension

Abstraction

Linearity

3-dimensionality

Important Trends in Media

Convergence Interactivity Creativity Optimization

20 17 2 3

16 10 15

Newspaper Magazine Broadcast Cable Radio 18 Yellow Pages Direct Mail

35 5 18

Bus. Pages
Outdoor Internet Misc

Newspaper 16 Magazine 10 Broadcast 15 Cable 18 Radio 18 Yellow Pages 5 Direct Mail 35 Bus. Pages 3 Outdoor 2 Internet 17 Misc 20

Media Defined
The vehicles that carry the ads to the target market.

Which is most important? Picking the correct media or having great creative? What are the types of media? Checking Share of Voice vis a vis competition.

Media Planning
Media Planning is the process of designing and scheduling time and space to achieve marketing and advertising objectives.
A Medium or a media vehicle is a single form of communication. Media Mix is a combination.

Key Media Terms

Media objective: statement in media plan that
explains the goals of the plan; usually states how many of the target will be exposed to advertising messages in a given time period, and how often. outlines how objectives will be accomplished; shows where and when advertising messages will appear, and at what cost.

Media strategy: statement in media plan that

Methodology MARKET / TARGET AUDIENCE ANALYSIS | MEDIA OBJECTIVES | ASSESSMENT OF CANDIDATE MEDIA/COMPETITIVE ACTIVITY, ETC. | CREATIVE CONSIDERATIONS | STRATEGY DEVELOPMENT | PRELIMINARY MEDIA NEGOTIATIONS | MEDIA STRATEGY + PLAN | MEDIA BUYING | POST-CAMPAIGN REVIEW/ASSESSMENT

Setting Media Objectives

Creative Sources ( theme, message, research ) Marketing Sources ( Distn, Competition ) Media Sources ( Popularity, profiles, costs )

Sales,

Target Audience

Getting your number right in terms of demographics

Slide 55

Market Prioritization Chart

High MP

Low MS
Low market share

High MS
High market share

but

Good market potential

and

Good market potential High market share

Low MP

Low market share

and

poor market potential

but

monitor for sales decline

Slide 55

Media Selection Considerations

Cost per Contact

Factors Influencing Media Mix Decisions

Reach

Frequency

Audience Selectivity

Media Selection Considerations Cost per Contact Reach

The cost of reaching one member of the target market.

Frequency
Audience Selectivity

The number of target consumers exposed to a commercial at least once during a time period. The number of times an individual is exposed to a message during a time period.
The ability of an advertising medium to reach a precisely defined market.

CPM* Formula and Example

CPM =
Cost X 1,000 Audience

Which is more cost efficient on a CPM basis?

A-- :30 TV Commercial in Friends $250,000 X 1,000 = $12.50 CPM = 20,000,000 B-- :30 TV Commercial in Monday Night Football $300,000 CPM = X 1,000 = $10.00 30,000,000
*M stands for the latin word Mille or 1000

Media Planning Process Cost per Thousand Which publication is more cost efficient ? Cost of Qtr Page Paper A Paper B Rs 3,360 Rs 2608 Reach 6,00,000 4,00,000

CPM = Cost Reach

x 1000

Media Planning Process Cost per Thousand

Which publication is more cost efficient ? Cost of Qtr Page Paper A Paper B Rs 3,360 Rs 2608 Reach 6,00,000 4,00,000

CPM = Cost Reach

x 1000

Paper A : 3360 / 6,00,000 x 1000 = 5.60 Paper B : 2608 / 4,00,000 x 1000 = 6.52

Media Selection
Media are evaluated based on selectivity. There are two types of selectivity:

Class Selectivity is the ability of a medium to reach the target market without waste. Geographic Selectivity is the ability of a medium to cover a particular geographic area without spillover.

Media Planning
Reach
(% of target audience with opportunity for exposure to media vehicle(s) or media plan in a given time frame)

+ Frequency
(average number of times target is likely to be exposed to the ad in a given time frame)

100%

Media Planning Process Reach

Reach is the percent of target audience who have the potential hear, or read the ad at least ONCE. Total Population : 1,200,000 Readers of Paper A : 6,00,000 Reach = Readers / Population x 100 6,00000 / 1200000 x 100 = 50% One ad in Paper A achieves 50% reach

The Difference between Reach and Frequency

Unduplicated Reach : Takes into account common readership of 2 or more publications

Reach/Frequency Inverse Relationship

6,000 5,000 4,000

Reach

3,000 2,000 1,000

3 4 5 6 7 8 9 10

Frequency
Slide 53

Advertising Response Curves

Threshold
Response Response Frequency Frequency

a. S-shaped response curve

Slide 54

b. Convex response curve

Media Planning Process Frequency or OTS The number of times on average the TA sees or hears the ad. OTS is the Opportunity to see OTS = Reach of Target * freq Target Audience

Media Planning Information Sources Press National Readership Survey , ABC TV TRPs ( total rating points ) Radio - Research

Quantitative models
to evaluate and optimise multi media plans to identifie and define target audience profile beyond sheer demographics to track and alert planners of under deliveries - a tool that evaluates radio plans using NRS for non-ILT markets a tool that helps in quantifying IMPACT GRPs helps in maximizing media ROI to helps in measuring media responsiveness to help in harnessing the potential of small towns in India through SCRs to hels in segmenting ads by copy strength to help in quantifying decay rate and can also be used for scheduling to help in understanding the relationship between media inputs & output measures such as call-ins, walk-ins etc MULTIVARIATE ANALYSIS - attempts to map consumer insights and the delivery mechanism

Press Plan - Sample

Publicati on Edition Frequen cy Ins Unit Size Col/B/W Position Cost per Sq cm Gross Cost
Net Cost

TOI

New Delhi

Daily

400

Color

RHP

1995

798,000

678,300

Ananda Bazar Patrika People

West Bengal

Daily

400

B/W

RHP

1155

462,000

392,700

National

FPC

Color

Opp 1st Content Page Page 5

100000

1700000

144,500

Hindu

Chennai

Daily

400

B/W

1,490

596,000

506,600

Nav Hind

Panaji

Daily

400

B/W

RHP

70

28,000

23,800

TV Plan - Sample
Channel Program Date Time Rate / 10 secs Duration Spots FCT Cost
Remarks

ESPN / Star Sports CNN-IBN

English Premier League News

Sat-Sun

23.00

6750

30

15

450

303,750

Mon-Fri

07001000

3400

30

180

61,200

UTV Movies

Shandar Sunday

Sunday

2030hrs

600

30

270

16200

Star World

Moment of Truth Prime Time Movies

Tuesday

21002200

4000

30

120

48,000

Zee Studio

Mon-Sun

18002400

800

30

123

3690

295,200

TV Ratings

Rating = HH tuned to show Total HH

A rating point of 1 represents the total HHs . For example if a top rated Program is rated 12, if would reach 12 * the number of households

Cinema Plan - Sample

City Theatre Location CAPA CAT Rate/ Week M Tax Tax Basis #Weeks
Cost

Delhi NCR

PVR Ambi-1(D)

Gurgaon

44

A+

14000

Nil

NA

70000

N Delhi

PVR Priya

Vasant Vihar

944

A+

50800

2880

PA

304800

New Delhi

3Cs

Lajpat Nagar

315

A+

25000

2880

PA

150000

Bangalore

Fun Cinmeas1 PVR Mulund 5

Cunnigham Rd

447

A+

15000

550

6 Weeks

90000

Mumbai

Mulund

314

A+

27910

Nil

na

139550

Evaluating the Media Plan

Follow upgetting make-goods, tearsheets. Measuring the impact:

Test consumer awareness of campaign before, during, and after. Sales data. Compare actual reach/frequency figures to proposed estimates. Nielson, Arbitron, Simmons, Audit Bureau of Circulation

Syndicated Media Research Services

Pre & Post Evaluation

Markets GRP Index Average Frequency 1+ 2+ etc

Delhi

Gujarat

Karnataka

Punjab

Activity
Work out a Media Plan for SOIL to attract best students from India . Total budget is Rs. 200 lakhs. Cost of media are : Media / Publication Circulation Rate per sq cm Mainline Daily 500000 2000 Business Daily 100000 1000 FM Radio Rs 2000 per spot Prime Time TV Rs 200,000 per spot Cable TV Rs 5000 per week

Outdoor Rs 15000 per month Work out a media plan for SOIL

Media Scheduling

(continued)

(the attention-getting ability of the media vehicle(s) selected to run the ad)

Reach + Frequency + Continuity + Dominance/Impact

100%

Media Scheduling
Continuous Media Schedule

Flighted Media Schedule

Pulsing Media Schedule

Types of Media Schedules

Seasonal Media Schedule

Media Scheduling
Continuous Media Schedule
Advertising is run steadily throughout the period.

Flighted Media Schedule Pulsing Media Schedule

Seasonal Media Schedule

Advertising is run heavily every other month or every two weeks. Advertising combines continuous scheduling with flighting.
Advertising is run only when the product is likely to be used.

Reach, Frequency, and Continuity Relationships with a Fixed Budget

Sample Flowchart of a Media Plan

Media Selection: Quicklist of Advantages

Medium
Newspapers

Advantages
Many ad sizes available, quick placement, and local targeting.

Magazines

High-quality graphics/reproduction, prestige factor, and color. Combines sight, sound, movement. A single message. Demonstration. Intimacy, loyal following, and ability to change message quickly. Measurable, graphics, color, 3-D, and highly personal.

TV Radio

Direct Mail Outdoor

Local targeting, graphics, color, simple message, and larger than life.

Slide 56

Media Buying
Media Buyers Function
1. Provide Information to Media Planners

2. Select the Media

3. Negotiate cost / Make Media buy. 4. Monitor the media plan performance 5. Evaluate the Media Choices after the campaign. 6. Handle all Billing and Payment

Slide 56

Examples of Nontraditional Media

Inflight Events Road signs Aladdins Castle Beyond the Wall Channel One CineSpot CNN Airport Network Cover Concepts Book Covers Go Cards Instant Coupon Machine Military MediaBoards Miller Airship Resort Sports Network Roadmark Fleet Advertising Screenvision U Airplanes Supermarkets Mandis Malls College posters High schools Cinemas Airports High schools Health clubs, restaurants Supermarkets Military bases Blimps Resorts Trucks Cinemas College newspapers

Evaluating the Media: Key Terms

Rating point: the % of a given population group that uses a
specified media vehicle. Share: Households/persons using television (HUT, PUT): % of homes or people watching TV at a given time. Gross rating point (GRP): total number of ratings for different media vehicles. Gross impression: translation of GRPs into people; number of audience exposures x number of times they will see or hear vehicles. Cost per rating point (CPP): cost of buying one rating point in a given media vehicle or type. Audience: number or % of homes or persons using a media vehicle. Coverage: Same as reach the % of homes or persons receiving broadcast signal within specified area, or receiving specific magazine or newspaper.

Evaluating the Media: Key Terms,

Continued

Circulation: Total number of copies of a publication sold

through various forms of distribution. Readers per copy: average number of people who read each issue of publication.