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Direct Response Marketing

Media Zone: Finding the Right Opportunities in 2Q Media

1 Apr, 2013 By: Robert B. Yallen Response


First-quarter 2013 has been challenging from an inventory clearance perspective. According to Nielsen Monitor-Plus, January 2013 general ad units rose 4.6 percent in national cable at the expense of the DR industry, with DR product category units off by 9.8 percent.

The seemingly robust marketplace is being driven by a strong upfront and a healthy scatter market. There are eight product categories driving that growth with an average of a 48.3-percent increase in commercial units: Web-based apps/games, websites, computer software, auto insurance, printing services, legal services, quick-service restaurants and prescription flu medication.

Cable experienced a much tighter 1Q than broadcast. Broadcast viewing is down this season, and cable has continued to gain share. Lower ratings will impact broadcast inventory, as more units are needed to supplement buys to make up for smaller audiences on guaranteed deals.

Overall, demand for broadcast time is down versus a year ago. Several predictors in this area had initially forecasted 4.8-percent annual growth for broadcast in 2013 and have revised it downward to 2.1 percent. Current pricing in the broadcast scatter market is running about even with rates that were part of upfront negotiations.

Strategy and Tactics

There are many ways that DR media organizations can shine in difficult marketplaces and solidify themselves as a significant cut above the others. Michael Jordan once said, “Obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it, or work around it.”

Jordan puts into perspective how we need to look at our business and create our own opportunities from what appear to be obstacles.

Savvy media companies encourage their clients to book quarterly or annually to lock in rates. For the right types of products, negotiating for sponsorship opportunities, as well as billboards, can add to the media formula.

In the situations where higher rates are required for clearance, negotiate for bonus weight in other less-impacted dayparts and/or days of the week.

A performance-based (PI) program should always be a part of a DR strategy. Done properly, the PI metric is slightly below that of the cash equivalent. Even though the marketplace is exceptionally tight, some agencies are showing PI sales up as much as 7 percent.

Finally, all advertisers should always have a fire-sale budget of 5 percent to 15 percent to take advantage of last-minute media opportunities.

Opportunities

Still one of the best media opportunities is in unwired networks, such as the CPM Network. Unwired networks rely on local cable and broadcast inventory. These unwired networks aggregate a tremendous amount of media inventory and are able to leverage more efficient media buys on television and radio.

Additionally, many agencies tend to avoid buying local broadcast because of the amount of work required to string together meaningful volume. However, with marketplace conditions and the growth trend in national cable, local broadcast television is an opportunity.

DR buyers are always looking for new network opportunities. There are about eight reasonable new prospects that all clients should include in testing strategies.

Branded entertainment segments present an often-unknown media opportunity. This is basically “pay-for-play” where agencies negotiate a paid rate for a show segment and design the segment content around the clients’ product or services. Done properly, these segments are very effective and leverage the editorial non-commercial approach. Branded entertainment segments work best when the advertiser has a spokesperson that can carry the show, make the content interesting, and sell the offer!

Other opportunities that should be constantly utilized include radio and VOD.

Second-Quarter 2013 Projections

Second-quarter 2013, in its first few weeks, will be basically flat with a 5-percent plus-or-minus rate increase on key networks as it progresses.

Wayne Gretzky said, “You miss a 100 percent of the shots that you don’t take!” Make sure that you look at every possible opportunity and then look for more. ■


About the Author: Robert B. Yallen


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