Ask the Broadcast Professionals (or what would you like to know about advertising)

In My Humble Opinion
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**Ivylass ** and I have decided to open up a thread to answer any questions people might have about the advertising/ broadcast industry.

She works on the station side, and I work at an ad agency in the buying department (we spend the client’s money on their advertising for them). Between us, we’ve got most of the industry covered.

Basically, a client at ABC Corp decides they want to advertise their new “Thingamajig.” How that ends up from point A to point C (the tv, cable, or radio station) is a pretty involved process that most people are fairly unaware of (at least in my experience).

We’ll probably be throwing a lot of terminology around, but we’ll try and keep it all in layman’s terms. Feel free to call us out on using vernacular if you catch us.

So what’cha wanna know?

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Sorry, could a moderator fix the spelling in my subject line. I hit submit way too quickly.

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Can you give a brief overview of the process?

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Of course…

So as I was saying earlier, assume ABC Motors (the client) has a new car that they want to advertise. They would work with their advertising agency’s planning department to decide how much they want to spend on a national or a local level.

National advertising - these are the commercials that everyone in America sees at the same time. Most Super Bowl ads fall into this category.

This is sort of blanket/shotgun type advertising and is difficult to target your message to specific demographics or areas of the country.

Local advertising - as you can guess, these are ads that are run on a local level. The United States is divided into many DMA’s, or Designated Market Areas. Chicago is a DMA, Milwaukee is a DMA, Wichita is a DMA. Each DMA does not just cover the city that it’s named for, but usually a larger area covering several counties. There is usually only one large population base per DMA though.

I work in a department that buys time on a local level This means that the client tells our agency how much money they want to spend to market their product in a particular DMA - but not only how much they want to spend, but what they want to achieve with those dollars, namely Ratings Points.

So what our job is, is to take the clients budget and ratings needs - and use that information to negotiate an advertising schedule with an individual station to maximize the client’s exposure to their desired demographic.

Whew… Ok, this isn’t so brief afterall.

So to boil it down a bit, the client tells the agency (if they use one, some have internal ad departments) to spend X amount of dollars to achieve Y amount of ratings points in a specific market. A Media Buyer (what I do) negotiates with the station either directly, or through their rep firm (more on that later) to get the most bang for their buck. If a client wants to market to Males aged 25-54, they’re probably not going to advertise in Days of our Lives or Dr. Phil. So we’re responsibile for looking at a market, and putting together a schedule that will give our client what they’re looking for.

There are a lot of nuts and bolts to this process that I’ve glossed over or left out completely, but I hope that gives you a basic idea of how this thing works.

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I’ll give it from my side, the broadcast side.

The sales people/account executives go out and tell the agencies how wonderful the broadcast outlet is, how we can reach the demographic who is dying to buy their product/service. It’s somewhat complicated, but there’s a reason you won’t see Cialis on Nickelodeon…it’s not their demographic. They can reach more older men advertising on ESPN, CNN, etc.

The ad agencies need to get the word out about their product, so they want the most bang for the buck. They want to know how many impressions the broadcast outlet can deliver. This is tied into 1)How big is the market (New York is bigger than Butte, Montana, for instance) 2)How popular the programming is (Desperate Housewives delivers more impressions than a re-run of Cheers.)

It’s not just eyeballs. It’s how many eyeballs (impressions) fall into certain groups. TD Waterhouse, for example, would want to know how many Men 35+ watch your show, while Cocoa Puffs wants to know how many Children 3-11 watch your show.

This is all hammered out through negotiations. After HelloNinja explains that part, I’ll can get into what happens after the deal is reached and how the commercial gets on air, and Og forbid you don’t deliver the impressions you say you will.

Some questions were answered (somewhat hijackedly) in this thread. And thanks to HelloNinja for cohosting this thread with me!

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I have just got some general questions about how many of the advertisers afford it. This extends all the way from the local level to the mid-sized ones. I often see something like a restaurant or a local type business advertise on radio or TV with some fairly prominent ads. In my mind, everything that just went on to get that ad out costs big money and I wouldn’t guess they would have that much of it so how does that work?

What are the prices like for some of the crappy, mundane spots that we see day in and day out for crazy car salesmen and things of that nature?

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Oooh, now you’re getting into proprietary information, Shag. Every broadcast outlet has a rate card, basically, this is what we charge for spots (time on air.)

However, there’s lots of wiggle room, depending on the CPM (cost per thousand, HelloNinja can explain that) and how much money the agency is willing to spend. It also depends on the sellout level of the broadcast outlet. The Super Bowl ads, for example, have rates that are most likely set in stone. That’s because the show is guaranteed to sell out its advertising and deliver on its impressions. But the station in the 50th market may have more time to sell than willing buyers, so they may discount their rate card or they may give a reduced rate to one advertiser willing to spend X amount of money.

Also, for many of the local TV stations, they may throw in producing the commercial for free if you buy X amount of time.

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Honestly, most of the smaller places can’t afford it and are unable to advertise on network television.

Pricing all depends on the eyeballs. It’s not often you’ll see the really low-rent places advertising in the middle of Survivor in a large market like Chicago or Detroit. I’ve seen spots run anywhere from $10 for a late night movie to $20,000 for a spot in a top tier program like CSI or Desperate Housewives.

Most network shows have a specific commercial break dedicated to local spots. These can be filled by the large agency’s clients like a Ford or a Wal-Mart - or they can be sold by a “Local Sales Rep” who works for the station and sells to the smaller companies in the area, like carpet stores.

Auto dealerships are an interesting group. Most form Dealer Groups with dealers in other markets in a region. They pool their money together and use an agency like ours to place their spots. In fact, most car ads bought on a local level come from such dealer groups. The national ads are bought by the head corporate offices and are more “Buy a Dodge” whereas the local spot might be “low financing at your CHicagoland Dodge Dealership.” The national spots, as you can imagine, cost a lot more as they’re being seen all over the country.

Options for these smaller advertisers are radio and cable, both of which are very affordable. Some cable spots, as **Ivylass ** can probably attest, run only $2-5 per spot depending on the network they run on.

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I think you’ll find that’s only at the MSO, or cable provider (Time Warner, Brighthouse, Comcast) level. The cable networks can be quite competitive and expensive.

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Ok, but about how much does Insanely Crazy Bob have to fork out to peddle the nicest cars at the nuttiest prices east of the Pecos a few times a day to the unemployed and Opah set? $100 a day ? $10,000?

If I give you $10,000 and a pretty good DVD that I made myself, what type of exposure could that get me over the course of a week or so? I will settle for everything from the major Boston stations to local access TV. I just want as many neighbors as possible to hear about me on the air.

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I don’t know about Boston specifically - but for $10k in a week, I think you could get a fairly decent rotation in a small to medium sized market. I mean, you can usually get Oprah spots in a market like St Louis or Detroit for $500 or so. You can even get into Prime for only $1000.

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It depends on what station/cable channel you want to be on, what time of day, what show. If you want to buy a certain show, it will be more expensive that buying a particular time of day (CSI vs primetime)

I think $10,000 would go a long way at the local level. At the network/cable network level, you’d be lucky to purchase enough time to air 4-5 spots.

Back to the bang for your buck…there are some advertisers, that quite frankly, are not spending their money wisely. Buying three commercials a week is not going to get you enough exposure to be remembered. I think I read somewhere that your commercial has to be seen by the same person seven times before that person creates a memory of your product/service. Part of the agency’s job is to spend their clients’ money wisely.

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Cool! That’s a lot less than I always thought. The numbers never made much sense in my mind but at least that part of it is clearer.

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I’ve got a question for HN.

We have a schedule for spots. We call the agency for copy instructions. The agency says they’re not in flight. Our salesperson says they are.

Where’s the breakdown in communication?

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HelloNinja

Are you on the account side, creative side or other?

And are there a series of initials — say B’s or D’s — in the name of your agency? :smiley:

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This is very true.

At the end of each advertising campaign, normally quarterly, the agency has to do a “Post” on the schedule they ran. This means that they take the estimated numbers from when the buy was put together and see how it compares to how many people actually saw the spots in the target demographic. Most clients want to see a 90% post, so if they ordered 100 rating points for $10,000 - and only enough people watched the station’s programming to achieve 85 rating points - the client is NOT going to be happy with the agency or the station.

Most stations book orders with the knowledge that they have to post to a certain amount, and if they don’t, they’re held liable for making up those missing points in no/charge spots in similar programming.

It wouldn’t surprise me if 20% of all ads you see in a given day are no/charge spots. More stations underpost than don’t.

Also, on the other side of the coin, you don’t want to OVERdeliver ratings points. If a station achieves 120% of what was ordered - then the client feels like their money wasn’t spent wisely and that more spots could have been bought for the same amount of money to get the desired result.

Media buying is like the Price is Right… who can get closest without going over?

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Hmmm…

Well…once a schedule is put together, it’s shown to the client supervisor who approves it to air.

Once it is approved to go on the air, the agencies Traffic Department is supposed to send traffic and instructions to the station.

Usually if a station thinks we’re in flight, when we’re not, it’s because a revision of some sort comes down and the station isn’t properly notified. This is definitely a serious problem that we could get written up for.

If we cancel a week in a market, and the station doesn’t get told, and they run the spots - we’re on the hook for them since we screwed up. If we’re lucky, you call us looking for traffic that doesn’t belong - and we catch the error and hope it all gets fixed.

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I’m on the Media side, in the local spot buying department.

I’d love to work in creative, but I just don’t like snorting things up my nose enough. :wink:

And no, but I know of whom you mean. :slight_smile:

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These are called ADUs, or Audience Defiency Units. Basically, you told the client you would deliver so many eyeballs and you didn’t, so you run free spots to get them up to the impressions you said you would deliver.

I’m not surprised.

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Are rates lower for non-profits? Red Cross, stuff like that.

Do any of the designated market areas have quirks that are known in the industry – like such and such would never work in Boise, or this other thing is a sure hit in Boston?

Do the big companies ever just give up on a particular market, for either positive or negative reasons? Does Coke even need to advertise in Atlanta? Does Pepsi even bother?

Was there ever a commercial or campaign that surprised you – maybe you thought it was eh, but then it turned out to be hugely popular?

TV/kitsch nostalgia is so popular these days, I’ve wondered why companies don’t run classic retro ads. I’d figure if nothing else, it would be less expensive than producing a new commercial. Is there a reason this doesn’t happen, or am I just out of touch with what makes those crazy kids buy products these days?