MEDIA PLANNING

MEDIA COSTS AND BUYING PROBLEMS +

SETTING AND ALLOCATION THE BUDGET
Lecture 9
Jul 23, 16

Campaigns?

Media Costs and Buying

Every media plan with any alternates/

mediums/ vehicles has a different cost
It should maximize the delivery of media
objectives
If you achieve 100 GRPs in Rs.10Mn, when you
were asked to achieve them in Rs.5Mn, then
that questions your credibility
The media planner must go through a
calculated process of matching the cost of
various media alternatives with the delivery
of the plan to arrive at the optimal
relationship between cost and delivery

Media Costs and Buying

Post-buy Analysis:

Once the media plan has been

implemented and the schedules
completed, the media planner should
examine how closely the media cost
estimates match actual costs

Media Costs and Buying

TV:

Perishability of Inventory
Inventory, Perishability, Demand create a dynamic
marketplace
Money paid vs GRPs wanted
Buyers need the following info:

Geographic area
Buying target audience (women 2554)
Commercial length (30-second)
Dayparts to be used in the plan (daytime, prime, news, late
fringe)
Schedule dates (typically there is a different CPP for each
quarter)
Special buying instructions, such as the need to purchase highrated (highcost) programs, sports sponsorships, promotional
requirements, program content restrictions, and so on

Media Costs and Buying

TV:

Dayparts:

Early morning
Morning
Daytime
Early Fringe
Early News
Primetime
Late news/ Late Primetime
Late fringe

Media Costs and Buying

Print

Rate Cards issued for a year, covering all

ad sizes/ positions
Media Planner should be careful about
cost increases
Newspapers Sunday editions are
surviving and thriving

ROP (Run of Paper)

Supplements
Custom Inserts

Media Costs and Buying

OOH

Poster Panels (smaller, vertical)

Painted Bulletins (bigger in size)
Panaflex billboards
Transit Advertising (buses, taxis, trains,
etc)
OOH Video Display

Media Buying Problems

This many GRPs in this amount of
money!
Timing:

When to buy can create problems.

Normally, there is a delay in budget
confirmation vs buying space
The ideal time to buy is when sellers are
anxious to sell
Buy early, prices are low, inventories are high
Buy late, prices are high, slots are not there

Cost Considerations:

Pre-eid/ Ramzan

Media Buying Problems

TV salesperson: This is a great new

show by the same people who
developed Mera Sultan. Its sure to do
at least a 5.4 rating.
Agency buyer: Oh, give me a break.
Everybody and his brother is doing a
Mera Sultan knockoff. Itll be lucky to
do a 3 rating.

Media Buying
Network TV is bought in three-ways

Up-front (Long-term) Buys

An up-front, or long-term, buy is the purchase

of inventory for all four quarters of the coming
broadcast year

Scatter (Short-term) Buys

A scatter, or short-term, buy is the purchase of

inventory within a specific quarter, made
before the start of that quarter

Opportunistic Buys

Opportunistic buys involve the purchase of

inventory on a last minute basis if the
networks have any remaining inventory to sell

Media Buying
Other Types

Sponsorship of programs
Special-event Network Programming

Media Budgeting
Dilemma:

No one knows precisely how a given

amount of money spent for advertising will
affect sales or other marketing goals

Before budgets are defined, planners

must be clear on the expectations

Methods of Budget Setting

Percent of Sales method

The percent-of-sales method multiplies

projected sales revenue for the year by a
given percentage to be spent on
advertising
As sales increase, so does the advertising
budget. If sales decline, the budget also
declines

Methods of Budget Setting

Competitive Spending method:

The competitive spending method depends on setting

the budget in relation to the amount of spending by
competing brands
This method assumes that the competition knows what
they are doing, and our goals are the same as theirs
which is questionable

Objective and Task method:

The objective-and-task method starts with someone

setting specific marketing or advertising objectives.
These are costed out, and the total cost represents the
budget
Objectives can be sales, share volume levels, revenues
expected, income, or profit

Methods of Budget Setting

Expenditure Per Unit:

Is a variant of the percent-of-sales

method. In this method, the budget is
generated as a result of sales, but the
base is units sold, not dollar sales.
Disadvantages?

Methods of Budget Setting

Subjective Budgeting

Subjective budgeting systems involve

making decisions on the basis of
experience and judgment
Also called all we can afford
Also called ad-hoc
Also called Sethiya

Factors in determining the size of the

budget

Assessing the task of advertising

Long and Short term goals
Profit margins
Degree of product usage
Difficulty in reaching TA
Frequency of purchase
Effect of increased sales volume on
production
New-product introductions
Competitive activity

Organogram Media Planning Agency

GM

Director
Operations

Admin Head

HR
Manager
Head of
Buying
Manager
Buying
(Electronic)

Manager
Buying
(Print)

Head of
Planning
Media
Planners

Finance
Manager

Head of
Client
Servicing

Client
Servicing
Managers

Head of
Research

Manager/
Assistant/
Officer