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Media Planning

Media Planning. Negotiations.

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Media Planning

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  1. Media Planning

  2. Negotiations • The role of a media planner is not just restricted to decide the communication that needs to go out; he also has the role of a buyer because he buys Channels, portals etc. Therefore the need to negotiate comes in; to negotiate means to discuss in order to reach an agreement. There are negotiations in media because there is a margin around media buying & selling.

  3. Contd… • The existence of a margin translates into demanding for a better value that is to have a better rate of investment. • KPI’s (keep performing indicators) are important for a media person as they help in assessing the performance levels. • Being competitive is very important in today’s world as there are wide choices available & in order to stay competitive, it is imperative to find a higher platform for one’s self. This can be done by providing incentives in media (shelling out ad space & ad time) to the client.

  4. Contd… • Therefore media negotiations can be summarized  as follows:

  5. OUTRIGHT DISCOUNTS: Outright Discounts means operating on a smaller budget (say instead of Rs.20, 000, operate on Rs.4500.) It includes the following: 1.   Credit Note: If client buys (channels etc) for 20k  then depending on the volume of business done, a credit note (instead of cash) is given for a specific amount to the client by the media house. Example:                Business done for (say):                          1 crore    ->so give back 30% 2 crore    -> so give back 40%                          3 crore    -> so give back 50 % Now, if say client 1 spends 1 crore (therefore gets back 30 lacs credit note instead of cash) This is adopted so that the client benefits the next time the business is done with the agency.

  6. Contd… 2. Space banking: Space Banking is synonymous with "banking," and means to give incentive to trade with the particular channel, publication for them. Thus, in a way the client has the occupancy rights, once the incentives are paid for that.  It implies that if say 10 channels are chosen by media for its business & (say) 5 crores are to be accumulated across those channels, then an incentive can be given to be adjusted for next time. This ensures the client necessarily does business with them the next time.

  7. Example:  • Media agency (on behalf of client) allocates Rs. 5 crores across 10 publications, and say client 1 gives 1 crore to media agency out of which 30 lacs is the incentive for the publication (TOI) • Therefore even though the total bill to client across all publications may be 5 crores, next time he won’t have to pay to TOI as an incentive has already been paid. • All of these are “Price based” negotiations. However there are non price based negotiations also.

  8. Non Price based: 1. Premium Positioning: Giving a better media placement to the client i.e. instead of giving a   cash discount, the client gets a better ad placement. 2. Innovations: Out of the box ads. E.g. text wraps, out flowing flaps, ads below mast heads. 3. On website: Small promotional ads on sister websites etc.

  9. Non Price based: 4. Subscription deals (like Magazines have offers like, Subscribe for one year  & get Reebok shoes free etc). These are also called cross promotional activities. • For television these can be sponsorships or extra ad time etc.

  10. Market Assessment: Logic: There should be logical reason as to why a particular publication/channel is competition and how prices are set(should be competitive). Whims & fancies: There is no logic for the price benchmark. Coerce: This means to threaten in order to get business. It is about who is more desperate, i.e. in this spectrum which price do you want to settle at?

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