Media Buying Simulation:
An Introduction to Real World
Media Buying and Selling
Objectives of the MBS
• Familiarize you with the art of negotiating and
buying media
• Help you practice and appreciate the
importance of good written communication
skills in a mock business setting
• Give you practice calculating various media
metrics
• Encourage strategic thinking to improve your
ability to succeed in media planning
MBS Overview
• 16 teams of 2 students each
• 8 ad agencies will be buying rating points
(TRPs) in the form of media time
– Agencies will be given a budget, a rating points goal
to meet for two dayparts, and a media planning
objective
• 8 cable networks will be selling spots
– Network teams will be given a number of spots to
sell across two dayparts and a breakeven figure for
the inventory of spots
• All teams have access to
– ratings of all 8 cable networks during each daypart
(Appendix D)
– Descriptions of the cable networks
– Descriptions of the agencies including the client they
represent
MBS Rules
• All communications between groups MUST be through
email
• Teams must respond to all contacts and requests from
other teams within 15 hours
• exception: requests made between 12pm Friday and 9pm
Sunday must be responded to by 12pm Monday
• Any price or inventory offered to another team must not
change during this 15 hour period.
• All purchases and sales must be verified with a written
communication (email)
– While I do not need to receive initial offers or negotiation
emails, I do need to be copied on sales verification emails
• Each agency must buy time from at least two different
cable networks for each day part
• All business is to be conducted in a professional and
courteous manner
Concepts and Terms
• Target Rating Points (TRPs)
– Like gross rating points, but only for specific
target audience
– If a cable network offers a spot with a
rating of 4.0, and the agency purchases 5
spots, the agency has purchased 20 TRPs.
• Cost per rating point (CPRP or CPP)
– Cost of the spot(s)  TRPs for the spot(s)
• Cost per spot (CPS)
– Cost of one unit of avertising
– Often multiple units are purchased together,
so CPS is:
total schedule cost  number of spots in the
schedule
Examples
• MTV has 100 primetime spots available
with a rating of 0.8
• MTV needs to generate $250,000 with
those spots
• CPS = $250,000  100 = $2,500
• TRPs = 100 X 0.8 = 80
• CPP = $250,000  80 = $3,125
• If an agency wants to buy 20 TRPs,
they would need to buy 25 (20  0.8)
spots.
Examples (cont.)
• An agency needs to buy 250 primetime
TRPs with a budget of $850,000
• MTV has offers primetime CPS of $2500
with a rating of 0.8
• CPPa = $850,000  250 = $3,400
• CPPm = $2,500  0.8 = $3,125
• Since you can spend $3,400 on each
TRP, $3,125 may be a pretty good deal
• Of course you would still want to get
quotes from other cable networks to
see if there is an even better deal
Cable Networks
• In addition to your inventory and sales goals, you will receive
the names and email addresses of all agencies
– It will be beneficial to you to make distribution lists of all agencies
and your own team to facilitate communication
• There are eight agencies that you are trying to sell to
• There are seven other cable teams also trying to sell inventory
• You are competing against each other to try to maximize
profits
• Soon you will receive a “hello” message from each agency;
please reply to each of these
• Your reply may include information about the network and
preliminary prices for your spots; it’s never too early to start
selling!
• Remember all communications are sent as a team, so only
one person from each team need reply, but every member of
your team should get copied on every email sent
Cable Networks
• When the MBS starts, you may contact the
agencies to see if they have a response to
your initial pricing; again coordination of
emails should be evident…you don’t want to
sell the same spots more than once!
• You must respond to all contacts made by the
agencies within 15 hours (weekend excluded);
quick communication is often a key to success
in this game
• Any price you offer must stand during this 15
hour time frame, so be sure of your price
before you send it to the agency
• After negotiating the deal, you will receive an
“intent to buy” notice (Appendix E)
Cable Networks
• You must confirm the deal with a
“Confirmation” (Appendix E) The sale is NOT
complete until you have confirmation,
meaning that unless you have a copy of the
agency’s reply to the confirmation, there is no
sale
• If all inventory is sold before the end of the
simulation, you must send an email to all
agencies stating that you are sold out
• Once complete, summarize all sales using
Appendix F and attach the printed emails of
confirmation notices and receipt replies for
each sale
Agency Teams
• You will receive a budget and a buying goal for each of two
dayparts, and a media planning objective; in addition you will
receive the names and email addresses of the cable networks
you can buy from
– Make distribution lists for all cable networks as well as your own
team
• There are eight cable networks to buy from
• There are seven other agencies also trying to buy time from
the same networks
• You are competing against each other to make the best buys
and stay under budget, while meeting TRPS and planning
goals
• Immediately send a “hello” message to each cable team to
verify your distribution lists and to ask for initial prices for
their inventory
• While only one member of each agency team should send
these (and all) messages, be sure to copy all members of your
team so everyone knows what everyone else is saying
Agency Teams
• When the MBS starts, you can consider making buys;
either accept the initial pricing and make an offer,
decline outright, or begin negotiating
• You must respond to all contacts and requests made by
the cable team with 15 hours (weekend excluded)
• Quick communication is key to succeeding in this game
• If you make an offer to buy for a certain price, you may
not change that offer within the 15 hour timeframe
unless you have spent all of your budget or you have
reached your TRPs goal
• Once you agree to terms with a cable team, you must
send them an “intent to buy” (Appendix E)
• The cable team will reply with a “Confirmation”; for the
sale to be complete, you must reply to this confirmation
• Once your team has made all buys needed, complete
Appendix G to summarize the buys made, and attach
the printed confirmation emails for every buy
Grading
• The simulation is designed so that all budget
and sales goals can be met
• Every group who turns in all properly executed
and documented sales/buys, and meets their
budget/sales goals will get a passing grade
• Extra credit may be awarded to teams who
perform exceptionally
• Failure to meet budget/sales goals through a
lack of effort, or breaking any of the rules may
result in a failing grade. This includes the
email rule!
Timing
• Beginning now, teams may begin
communicating, but only in an introductory
manner and to test distribution lists
• No sales, offers, or negotiations of ANY kind
may begin until the start of the simulation
• The simulation will begin at noon (after class)
on Friday 11/10
• The simulation will end one week later, at
9:00am on Friday 11/17
• Your reports are due to me no later than
9:00am on Friday 12/1
– If you complete your sales/buys before 11/17 you
are encouraged to turn in the report during class on
11/17