Media Zone: Value — Not Rate — Is the Key to the Best Media Buy1 Nov, 2013 By: Bill Raymond Response
In the world of direct response, there is no bad media — only bad media rates. Technically rates are not “bad”; they are inadequate to meet the goals of the advertiser at that given time.
For a brand advertiser who uses cost-per-thousand (CPM), target rating points (TRPs), C3 and other metrics to evaluate media value, the process can often seem like the result of a complicated algorithm that requires an advanced degree to unravel.
And while there are many factors involved with determining media value, there are some key factors that help unravel the mystery — regardless if it is for a DRTV or brand advertising campaign: audience reach, daypart, seasonality, influencing events, holidays and — of course — the basic economics of supply and demand.
While these factors are incorporated into the media evaluation and decision making process for a DRTV campaign, the primary focus and belief of any good media buyer is all media will work at the right price — to a point. Knowing which media to hang on to, which to renegotiate and which to drop is both science and art.
The largest determining factor in a media rate remains the fundamental question of how many people can see it? The more eyeballs, the more an advertiser will pay; the larger the broadcast market or cable network, the more exposure the advertiser will receive. High-profile airings during prime viewing hours and strong, non-paid programming lead-in positions will amplify the rates accordingly.
Conversely, as an audience’s attention is diverted, rates begin to drop. For example, syndicated viewership data reveals that summer months garner fewer people watching television (PWTs). It’s understandable with the seasonal events — family vacations, outdoor activities and longer days are some of the factors that keep people away from the TV. Additionally, holidays like Memorial Day draw people outdoors with barbeques and beach days. Finally, singular events can impact rates, even if just for a few hours — the Super Bowl is a classic example.
To maintain strong campaign results in the face of these dynamic and numerous issues, it is important to heed three media truths: 1) focus on value regardless of rate; 2) avoid the group mentality; and 3) when results are down, work with the media outlet to find a workable solution before dropping the media. While there is an exception to every rule, these three items provide a good set of guidelines to ensure successful results.
If media is cheap, there’s generally a reason. Most of the lowest priced media is in smaller broadcast markets and during time periods when a majority of the audience won’t be watching — think a 3 a.m. Tuesday airing in Terre Haute, Ind. The avail reaches a sub-segment of a larger audience and rates are proportionate to that.
Alternatively, an airing at 10 a.m. Saturday in Dallas will reach a much larger audience, and the price reflects that. So, while price is relative, it is irrelevant when compared to value. A good media buyer will evaluate the rate based on historical performance for the avail, current ad campaign trends and market conditions.
Part of the seasonal cycle comes in the fourth quarter — and the famed “Red October” — as advertisers jockey for inventory at a time when consumer response is soft due to a variety of market conditions. Advertisers often succumb to the group mentality of bidding up rates to a point that the media becomes overvalued. Invariably, a savvy and patient media buyer can make opportunistic buys as the market corrects.
Similarly, it’s important not to overreact during times when results dip. Often, the attitude is to purge high-priced avails and concentrate on lower-priced media to minimize risk. This strategy will reduce cash exposure but it may also result in missed opportunities to revalue marginally performing media. It has been said often that getting a good media rate is the result of a strong buyer/seller relationship. That co-dependent relationship holds true when needing rate relief. The give-and-take dialog can result in a short-term solution that may include no-charge media or bundled packages that can help offset an overvalued time period.
Finding performing media requires diligent attention. Because of this, it is important to work with a media agency that has first-hand knowledge and a deep database of media history. This experience means they understand the seasonal trends of the industry, historical precedence for rate increases and decreases, and what can and can’t be tolerated. But most importantly it allows you the confidence that you’re getting the response you are paying for. ■