Media Strategy, Tactics, and
Budget Decisions
Media Terminology
Print
Media
Publications such as newspapers,
magazines, direct mail, outdoor, etc.
Media
Vehicle
The specific carrier within a medium
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
Canadian sales in market
BDI =
Percentage of total
Canadian population in
market
X 100
Brand Development Index
Our brand is Tim Horton’s Coffee. We
would like to compare our brand
development in Ontario vs. Alberta. Let’s
say that:




50% of our sales come from Ontario
30% of our sales come from Alberta
58% of the Canadian population lives in Ontario
29% of the Canadian population lives in Alberta
Calculate the BDI for each province. What
does this mean?
Brand Development Index

Ontario BDI = 50/58=.862X100=86.2

Alberta BDI = 30/29 = 1.0345x100=103.45
Brand and Category Analysis
Category Development Index
Percentage of total product
category sales in market
CDI =
Percentage of total
Canadian population in
market
X 100
Category Development Index
Tim Horton’s example:




40% of sales of all takeout coffee come from Ontario
30% of sales of all takeout coffee come from Alberta
58% of the Canadian population lives in Ontario
29% of the Canadian population lives in Alberta
Calculate the CDI for Ontario and Alberta
Category Development Index
Ontario = 40/58 = .689x100 = 68.9
Alberta = 30/29 = 1.0345 x 100 = 103.45
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
Brand and Category Analysis
Low CDI
High CDI
High BDI
Low BDI
The market usually
represents good sales
potential for both the
product and the brand.
The product category
shows high potential but
the brand isn’t doing well;
the reason should be
determined.
The category isn’t selling
well but the brand is;
may be a good market in
which to advertise but
should be monitored for
sales decline.
Both the product category
and the brand are doing
poorly; not likely to be a
good place to advertise.
4. Scheduling
Three Scheduling Models
Continuity
Flighting
Pulsing
Jan
Feb Mar
Apr May Jun
Jul
Aug Sep Oct Nov Dec
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 cannot be sure an ad placed 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
Gross Rating Points
GRPs refer to the weight of a media schedule
against a pre-determined target audience.
GRP = Reach (%) x Frequency
= 50 x 3.5
= 175
Determining Effective Reach
Figure 9-15
Marketing Factors Determining
Frequency
Marketing
Factors
Brand
Loyalty
Brand
History
Share of
Voice
Brand
Share
Usage
Cycle
Purchase
Cycles
Target
Group
Message Factors Determining
Frequency
Message
or Creative
Factors
Message Complexity
Message Uniqueness
New 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
Media Tactics Decisions
1. Media Vehicle
2. Budget Adjustments
3. Blocking Chart
Determining Relative
Cost of Media
Cost per thousand (CPM)
CPM =
Cost of ad space
(absolute cost)
Circulation
X 1,000
Homemakers
Magazine
Chatelaine
Canadian
Living
One time, 1
page, 4 colour
$20,640
$35,695
$27,222
Circulation
1,290,000
802,714
561,102
Homemakers
Magazine
Chatelaine
Canadian
Living
One time, 1
page, 4 colour
$20,640
$35,695
$27,222
Circulation
1,290,000
802,714
561,102
CPM
$16
$44.47
$48.57
Newspaper Cost Calculation
Newspaper rates are based on a per line rate
There are two ways to calculate lines – MAL and
Agate
Some newspapers use one way, some use another
Usually, the line rate goes down as you advertise
more = Volume discounts
Calculating Newspaper Costs
The Globe and Mail
Assuming you spend only $25,000 per
year
Find the cost of:
320 line ad in the National Paper on
Saturday for four Saturdays
Calculating Newspaper Costs
The Globe and Mail
Assuming you spend only $25,000 per
year
Find the cost of:
320 line ad in the National Paper on
Saturday for four Saturdays
Answer:
320 X $23.39 x4 = $29,939.20
Calculating Newspaper Costs
The Toronto Star
A 3000 line ad in the Saturday edition for 2
Saturdays
Calculating Newspaper Costs
The Toronto Star
A 3000 line ad in the Saturday edition for 2
Saturdays
Answer:
3000 x $20.78 x 2 = $124,680
Factors Influencing Newspaper
Rates
Position
Charge
A request for a specific page
or section increases the cost.
Colour
Colour increases cost but it
also increases awareness.
Inserts
Rates are quoted on a CPM
basis and are influenced by
number of pages.
Buying Magazine Space
The cost of the ad is determined by multiplying the
page rate (by size) by the frequency.
If a 1P, 4C ad costs $20,000 and it runs in 6
consecutive issues of a monthly magazine, the total
cost would be:
$20,000 x 6 = $120,000.
Magazine Cost Calculation
Plan
Canadian Geographic
1 Page
4 Colour
4 insertions
Cost Calculation:
$10,755 x 4 = $43,020
The base rate would be
the 3-5 times rate on
the rate card.
Magazine Cost Calculation
Find the cost of the following ad in
Canadian Living
1 page, 4 times in the National edition
What is the cost of the ad?
What is the CPM?
Magazine Cost Calculation
Find the cost of the following ad in Canadian
Living
1 page, 4 times in the National edition
Answer:
$28,575 x 4 = $114,300
What is the CPM
($114,300/551,884) X 1000 = $207.11
Magazine Discounts
Frequency
The number of times the
ad is run.
Continuity
The length of time during
one year period.
Corporate
Total pages bought by all
company brands during
one year period.
Colour and Position Charges
Colour advertising is the norm in magazines so rates are
usually quoted as 4-colour rates. Higher rates are
charged for cover positions and specific page requests.
Covers
Position
Charge
Inside Front (IFC), inside back
(IBC), and outside back (OBC).
About 20% more.
A specific page request
increases the cost per page by
15 – 20%.
Comparing Magazines for Efficiency
Specifications
Canadian Living
Flare
1P, 4C
Circulation
CPM
Both magazines have different rates and
circulations but the CPM is almost identical.
Comparing Magazines for Efficiency
Specifications
Canadian Living
Flare
1P, 4C
$29,160
$15,600
Circulation
551,884
172,362
CPM
$52.84
$90.51
Both magazines have different rates and
circulations but the CPM is almost identical.
Media Budget: Balancing Objectives and
Budget
What we’re
willing and
able to spend
Dollars
What we need
to achieve our
objectives
Goals
Managerial Approaches in Budget
Setting
Factors Influencing the Budget Decision
1. Market Size
2. Market Potential
3. Market Share Goals
4. Economies of Scale in Advertising
5. IMC Tools
High
Low
Competitor’s
Share of Voice
Ad Spending and Share of Voice
Decrease–find a
Defensible Niche
Increase to Defend
Attack With Large
SOV Premium
Maintain Modest
Spending Premium
Low
High
Your Share of Market
Top-Down Budgeting
Top Management Sets the Spending Limit
The Promotion Budget Is Set to Stay Within
the Spending Limit
Top-Down Budgeting Methods
Competitive
Parity
Arbitrary
Allocation
Top
Management
Return on
Investment
Percentage
of Sales
Affordable
Method
Bottom-Up Budgeting
Total Budget Is Approved by
Top Management
Cost of Activities are Budgeted
Activities to Achieve Objectives
Are Planned
Promotional Objectives Are Set
Objective and Task Method
Establish Objectives
(create awareness of new product among
20 percent of target market)
Determine Specific Tasks
(advertise on market area television and
radio and local newspapers)
Estimate Costs Associated with Tasks
(determine costs of advertising,
promotions, etc…)