10
Media Strategy, Tactics, and Budget
Decisions
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.
Media Terminology
Print
Media
Newspapers,such
Publications
magazines,
as newspapers,
direct mail,
magazines,
outdoor,
etc.direct mail, outdoor, etc.
Media
Vehicle
The specific carrier within a medium
The specific carrier within a category
category
Reach
Number of different audience members
exposed at least once in a given time period
Coverage
The potential audience that might receive
the message through the vehicle
Frequency
The number of times the receiver is exposed
to the media vehicle in a specific time period
Developing the Media Plan
Situation
Analysis
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
Media Planning Challenges
Measurement
Problems
Lack of
Information
Challenges
in Media
Planning
Inconsistent
Terms
Media Strategy Decisions
Media Mix
Target Market Coverage
Geographic Coverage
Scheduling
Reach vs. Frequency
1. Media Mix
• Generally a number of alternatives
• Decisions are based on:
– Objectives
– Product/service characteristics
– Budget
– Preferences
– Creative strategy
2. Target Audience Coverage
Population excluding target market
Target market
Media coverage
Media overexposure
Target
Market
Proportion
Full
Market
Coverage
Partial
Market
Coverage
Coverage
Exceeding
Market
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)
Brand and Category Analysis
Brand Development Index
Percentage of brand to total
sales in market
BDI =
Percentage of total
population in market
X 100
Brand and Category Analysis
Category Development Index
Percentage of total product
category sales in market
CDI =
Percentage of total
population in market
X 100
Brand and Category Analysis
High CDI
Low BDI
High market share
Good market
potential
Low market share
Good market potential
Low CDI
High BDI
High market share
Monitor for sales
decline
Low market share
Poor market potential
4. Scheduling
Three Scheduling Models
Continuity
Flighting
Pulsing
Jan
Feb Mar
Apr May Jun
Jul
Aug Sep Oct Nov Dec
4. Scheduling
Figure 9-10
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.
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.
5. Reach vs. Frequency
Establishing Reach and Frequency Levels
Figure 9-12
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
The Effects of Reach and Frequency
Determining Effective Reach
Message Factors Determining Frequency
Message
or Creative
Factors
Message Complexity
Message Uniqueness
New Vs.
vs. Continuing Campaigns
Image Versus Product Sell
Message Variation
Wearout
Advertising Units
Media Factors Determining Frequency
Clutter
Repeat
Exposures
Scheduling
Media
Factors
Editorial
Environment
Attentiveness
Number of
Media Used
Balancing Objectives and Money
What we’re
willing and
able to spend
Dollars
What we need
to achieve our
objectives
Goals
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.
Marginal Analysis
Sales in $
Sales
Gross Margin
Ad. Expenditure
Profit
Point A
Advertising / Promotion in $
High
Low
Competitor’s
Share of Voice
Competition-based strategy
Decrease–find a
Defensible Niche
Increase to Defend
Attack With Large
SOV Premium
Maintain Modest
Spending Premium
Low
High
Your Share of Market