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ADVERTISINGADVERTISING
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The PlayersThe Players
• AdvertisersAdvertisers
• AgenciesAgencies
• MediaMedia
• RegulatorsRegulators
• Sales RepsSales Reps
• Support – research, buyers, etc.Support – research, buyers, etc.
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ReachReach
• The number of The number of unduplicatedunduplicated exposures. exposures.
• i.e. the number of i.e. the number of differentdifferent people that people that see or hear an advertisementsee or hear an advertisement
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FrequencyFrequency
• The average number of duplicate The average number of duplicate exposures.exposures.
• i.e. the number of times someone is i.e. the number of times someone is exposed to an advertisementexposed to an advertisement
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Reach vs. FrequencyReach vs. Frequency
• The best media vehicle for reach is The best media vehicle for reach is network television.network television.
• TV penetration rates are near 100%.TV penetration rates are near 100%.
• With a single buy, an advertiser can With a single buy, an advertiser can reach millions of households, and tens reach millions of households, and tens of millions of viewers.of millions of viewers.
• Too expensive for high frequency.Too expensive for high frequency.
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Reach vs. FrequencyReach vs. Frequency
• Billboards and Newspapers are best for Billboards and Newspapers are best for frequency.frequency.
• If someone reads a newspaper, they If someone reads a newspaper, they likely read it every day.likely read it every day.
• If someone passes a billboard, they If someone passes a billboard, they likely pass the same billboard every likely pass the same billboard every day.day.
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Reach vs. FrequencyReach vs. Frequency
• Generally, reach and frequency are Generally, reach and frequency are mutually exclusive. A medium that mutually exclusive. A medium that delivers one, will not deliver the other.delivers one, will not deliver the other.
• Radio is possibly the best combination Radio is possibly the best combination of reach and frequency. of reach and frequency.
• Radio has high penetration, and is Radio has high penetration, and is cheap enough to allow frequency.cheap enough to allow frequency.
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DemographicsDemographics
• The more specific the demographics of The more specific the demographics of the audience – the higher the cost to the audience – the higher the cost to reach the audience.reach the audience.
• Minimizing Minimizing waste circulationwaste circulation..– Attracting a Attracting a qualifiedqualified audience of true audience of true
prospective buyers for the product.prospective buyers for the product.
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Cost per Thousand (CPM)Cost per Thousand (CPM)
• The cost of reaching one thousand The cost of reaching one thousand households, viewers, listeners, readers, households, viewers, listeners, readers, drivers, etc.drivers, etc.
• Allows advertisers to cross-compare Allows advertisers to cross-compare among several media.among several media.
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Audience ResearchAudience Research
• Began in 1929 with Archibald Crossley.Began in 1929 with Archibald Crossley.
• The “Hooperatings” dominated from the The “Hooperatings” dominated from the mid-30s to the 40s. Phone interviews.mid-30s to the 40s. Phone interviews.
• A.C. Nielsen began audience research A.C. Nielsen began audience research in the 1940s. in the 1940s.
• Arbitron (A.R.B.) established in 1949.Arbitron (A.R.B.) established in 1949.
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A.C. NielsenA.C. Nielsen
• Originally both radio and TV.Originally both radio and TV.
• Developed the Developed the audimeteraudimeter..
• Now only TV.Now only TV.
• Use diaries, audimeters and people Use diaries, audimeters and people meters.meters.
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ArbitronArbitron
• Now only radio.Now only radio.
• Must rely on diaries.Must rely on diaries.
• Experimenting with the Experimenting with the passive people passive people meter (PPM).meter (PPM).
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StatisticsStatistics
• Quarter-hour people (QHP), the Quarter-hour people (QHP), the average number people who listen to a average number people who listen to a station for at least five minutes within a station for at least five minutes within a fifteen minute block.fifteen minute block.
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StatisticsStatistics
• TVHH = television households. The TVHH = television households. The number of households equipped with number of households equipped with TVs.TVs.
• HUT = the homes using television. The HUT = the homes using television. The number of households with their TVs number of households with their TVs actually turned on. actually turned on.
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StatisticsStatistics
• Shares = the percentage of the HUT.Shares = the percentage of the HUT.
• Ratings = the percentage of the TVHH.Ratings = the percentage of the TVHH.
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Television Households
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Home Using Television (HUT level) = 50
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Tuned In
Rating = 25 Share = 50
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Problems in Audience Problems in Audience ResearchResearch
• AbsenteeismAbsenteeism
• HypoingHypoing
• Falsifying diariesFalsifying diaries
• Poor diary return ratesPoor diary return rates
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Selling advertisingSelling advertising
• Networks sell audiences.Networks sell audiences.
• Sales based on ratings points.Sales based on ratings points.
• If guarantee not met – then network If guarantee not met – then network provides provides make goods.make goods.
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Selling AdvertisingSelling Advertising
• Local Stations sell time.Local Stations sell time.
• 30s, 60s, - less often 15s, 90s, 120s30s, 60s, - less often 15s, 90s, 120s
• Sell by daypart.Sell by daypart.
• ROS, TAPROS, TAP
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Types of advertisingTypes of advertising
• Co-opCo-op
• BarterBarter
• Barter SyndicationBarter Syndication
• Sponsorship versus spot buyingSponsorship versus spot buying