10 Media Strategy, Tactics, and Budget Decisions

Chapter Objectives Understand the key terminology used in media planning. Know how a media plan is developed. Understand the process of deciding and implementing media strategies and tactics. Know the theoretical and managerial approaches for media budget setting.

Media Terminology Publications such as newspapers, magazines, direct mail, outdoor, etc. The specific carrier within a medium category Number of different audience members exposed at least once in a given time period The potential audience that might receive the message through the vehicle The number of times the receiver is exposed to the media vehicle in a specific time period The potential audience that might receive the message through the vehicle Number of different audience members exposed at least once in a given time period The specific carrier within a category Newspapers, magazines, direct mail, outdoor, etc. Print Media Print Media Media Vehicle Reach Coverage Frequency

Developing the Media Plan Selecting Media Within Class Selecting Broad Media Classes Determining Media Strategy Media Use Decision — Print Media Use Decision — Print Media Use Decision — Broadcast Media Use Decision — Broadcast Media Use Decision — Other Media Media Use Decision — Other Media Selecting Media Within Class Determining Media Strategy Selecting Broad Media Classes Setting Media Objectives Marketing Strategy Plan Creative Strategy Plan Marketing Strategy Plan Situation Analysis Creative Strategy Plan Situation Analysis

Media Planning Challenges Measurement Problems Measurement Problems Lack of Information Inconsistent Terms Inconsistent Terms Lack of Information Measurement Problems Measurement Problems Challenges in Media Planning Challenges in Media Planning

Media Strategy Decisions Reach vs. Frequency Scheduling Media Mix Scheduling Geographic Coverage Target Market Coverage Media Mix

1. Media Mix Generally a number of alternatives Decisions are based on: –Objectives –Product/service characteristics –Budget –Preferences –Creative strategy

2. Target Audience Coverage Target Market Proportion Full Market Coverage Partial Market Coverage Exceeding Market Population excluding target market Target market Media coverage Media overexposure

3. Geographic Coverage Firms should maximize the effectiveness of advertising and promotion dollars by spending in markets where they will achieve the desired objectives. Useful calculations examined by marketers to make this decision: –Brand Development Index (BDI) –Category Development Index (CDI)

Brand and Category Analysis Percentage of brand to total sales in market Percentage of total population in market BDI =X 100 Brand Development Index

Brand and Category Analysis Percentage of total product category sales in market Percentage of total population in market CDI =X 100 Category Development Index

Brand and Category Analysis High market share Good market potential High market share Good market potential High market share Good market potential High market share Good market potential Low CDI High CDI High BDI Low market share Good market potential Low BDI High market share Monitor for sales decline High market share Monitor for sales decline High market share Monitor for sales decline High market share Monitor for sales decline Low market share Poor market potential Low market share Poor market potential

4. Scheduling Three Scheduling Models Continuity Pulsing Flighting JanFebMarAprMayJunJulAugSepOctNovDec

4. Scheduling Figure 9-10

5. Reach vs. Frequency Reach Exposing potential buyers to the message. There is no known way of determining how much reach is required to achieve levels of awareness, attitude change, or buying intention. –We can’t be sure an ad in a vehicle will actually reach the intended audience.

5. Reach vs. Frequency Frequency The number of times one is exposed to a media vehicle. Advertiser has no way of knowing if exposure to a vehicle results in exposure to ad. Therefore, one exposure to the vehicle constitutes reach. This does not help determine frequency required to make an impact. –Precise determination requires consideration of creativity of ad, receiver involvement, noise, etc.

5. Reach vs. Frequency Establishing Reach and Frequency Levels Figure 9-12

5. Reach vs. Frequency Gross Rating Points (GRPs) –Based on the total audience the media schedule may reach. –Use a duplicated reach estimate. GRP = Reach x Frequency

The Effects of Reach and Frequency

Determining Effective Reach

Message Factors Determining Frequency Message Complexity Message Uniqueness New Vs. Continuing Campaigns Image Versus Product Sell Message Variation Wearout Advertising Units Wearout Message Variation Image Versus Product Sell New vs. Continuing Campaigns Message Uniqueness Message Complexity Message or Creative Factors Message or Creative Factors

Media Factors Determining Frequency Clutter Number of Media Used Repeat Exposures Editorial Environment Scheduling Attentiveness Number of Media Used Editorial Environment Repeat Exposures Clutter Media Factors

Balancing Objectives and Money Dollars Goals What we’re willing and able to spend What we need to achieve our objectives

Theoretical Approaches in Budget Setting Marginal Analysis As advertising and promotional expenditures increase, sales and gross margins increase to a point. A firm should spend money as long as the marginal revenues exceed the incremental costs.

Marginal Analysis Advertising / Promotion in $ Sales in $ Point A Profit Sales Gross Margin Ad. Expenditure

Competition-based strategy Decrease–find a Defensible Niche Increase to Defend Attack With Large SOV Premium Maintain Modest Spending Premium Competitor’s Share of Voice High Low HighLow Your Share of Market