Broadcast Advertising

1. Broadcast Advertising

2. Advertising Defined • Non-personal Communication • Usually paid for • By an identified sponsor • Persuasive in nature • About products, ideas or services • Through various media

3. Advertising in the Marketing Mix • Product • Quality, package, appearance, etc. • Price • Deep discount to premium • Place • Distribution channels • Promotion • POP, personal selling, PR, Advertising

4. Advertising Classified • By audience • Consumer • Business to Business • Industrial • Trade • Professional • Farm

5. Advertising Classified • Geographically • National • Regional • Local • International

6. Advertising Classified • By medium • Electronic • Radio • Television • Cable • Internet

7. Advertising Classified • Print • Newspaper • Magazine • Outdoor • Billboard • Transit

8. Advertising Classified • Specialty • Novelties • POP • Product placement • Etc. • Etc. • Etc.

9. Advertising Classified • By function • Product -vs- non-product • Commercial -vs- non-commercial • Direct action -vs- non-direct action

10. The advertising industry • Agencies • The media • The advertisers • The support services and suppliers • The regulators • The consumers

11. Advertising History • Functions of advertising: • Identify products and differentiate them • Communicate information about product • Induce consumers to try the product • Increase product usage • Build brand preference and loyalty

12. Advertising History • Dates to 1600s • British newspapers paid notices

13. Advertising History • Ben Franklin is credited with introducing white space and illustrations

14. Advertising History • Magazines became first national medium • Volney Palmer – first ad agency – 1841 • Bought newspaper and magazine space in large volumes at discount. • Marked up 15% • N. W. Ayer – first full service agency

15. Broadcast Advertising History • Out of the debate on how to pay for broadcasting came… • “Toll” broadcasting • WEAF • AT&T station • “telephone philosophy of paying toll for long distance calls. • First commercial broadcast • http://www.old-time.com/commercials/1stcommercial.html

16. Broadcast Advertising History • Post WWI • Radio grew • Lifestyles improved • Spending increased • Radio networks emerged • Advertising stressed the “Unique Selling Proposition”

17. Broadcast Advertising History • Television explodes post WWII • Radio programs shift to television • Radio adopts musical formats • Advertising costs increase • Sponsorships give way to participations or “spots” • By the 1960s – advertising entered the “image era”

18. Broadcast Advertising History • Depicting a lifestyle – not product information • Emotional appeals – not logical appeals • Remember the package – not the name • Focus on benefits to consumer

19. The contemporary advertising industry • Complicated by the proliferation of media • Audiences are splintered • Narrowcasting • Clutter and competition • High costs of media drive demand for research

20. Effects of advertising • On prices • On competition • On product image • On demand • “Creating” demands? • Bran, fiber, carbs, cosmetics, vitamins, etc. • Slow a declining market – “repositioning”

21. Media strategy • Buying patterns • Weekly cycles • Monthly cycles • Annual cycles • Seasonal products • Products/service with fixed maximum capacities

22. Media strategy

23. Media strategy

24. Media strategy

25. Media strategy

26. Media strategy • Reach • Unduplicated exposures – gross impressions • Number of different people exposed to the message • Frequency • Average number of exposures • How many times audience is exposed to message

27. Media strategy • Best frequency • Outdoor, newspapers, magazines • Best Reach • Network advertising, magazines • Best combination • Radio

28. Media strategy • Calculating cost efficiency • Cost per thousand (CPM) • How much it costs to deliver 1000 gross impressions • How much to reach 1000 listeners, viewers, readers, households, etc.

29. CPM 2 spots @ $8.00 each 1 reaches 4500 QHP 1 reaches 3500 QHP

30. CPM • 4500 + 3500 = 8000 gross impressions • 2 spots @ $8 = $16 – cost of the schedule • $16÷ 8000 = • .002 • .002¢ per person • X 1000 = 2.00 • $2 per 1000 QHP

31. CPM

32. CPM 200 ÷ 50000 = .004

33. CPM

34. CPM 354 ÷ 177000 = .002

35. Waste circulation • Reaching people who are not the desired audience • Demographics = age, gender, income • Psychographics = “lifestyle”

36. Audience research • How we know the size of the audience reached • Rating = percentage of all possible viewers or listeners • Share = percentage of people using media • Share is always a larger number

37. Audience research 100% All possible viewers or listeners

38. Audience research 100% TVHH

39. Audience research Not viewing HUT 50% HUT level = 50

40. Audience research Not viewing Tuned to our spot

41. Audience research 25% of TVHH – 50% of HUT

42. Audience research Rating = 25 Share = 50

43. Audience research terms • Gross ratings points • Average quarter hour people (QHP)

44. Audience research • Began in the 1920s with radio listenership • Archibald Crossley personal interviews • C. E. Hooper – Hooperatings – personal • A. C. Nielsen • Diaries • Audimeter

45. Audimeter

46. A.C. Nielsen • Now only television ratings • Use diaries, audimeters and “people meters” • Meters used for “overnights”

47. A.C. Nielsen terminology • Total survey area (TSA) • Designated market area (DMA) • Every county in the U.S. assigned to a DMA • Metro survey area (MSA)

48. Market areas TSA DMA TSA DMA TSA

49. Arbitron • Radio research • Dairies • Developing the “personal people meter” (PPM)

50. Arbitron terminology • Total survey area (TSA) • Area of Dominant Influence (ADI) • Every county assigned to an ADI • Metro survey area (MSA)