Media Strategy, Tactics, and Budget Decisions

1. Media Strategy, Tactics, and Budget Decisions

2. 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.

3. Media Terminology Publications such as newspapers, magazines, direct mail, outdoor, etc. Newspapers, magazines, direct mail, outdoor, etc. The specific carrier within a medium category The specific carrier within a category Number of different audience members exposed at least once in a given time period 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 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 Print Media Media Vehicle Reach Coverage Frequency

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

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

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

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

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

9. 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)

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

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

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

13. 4. Scheduling Continuity Flighting Pulsing Three Scheduling Models Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

14. 4. Scheduling Figure 9-10

15. 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.

16. 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.

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

18. 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

19. The Effects of Reach and Frequency

20. Determining Effective Reach

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

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

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

24. 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.

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

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