Mechanics of TV

Ranjit Dhillon Shares Marketing Tips On TV Marketing, TV Advertising, TV Commercials, TV Ads, Ads For TVs, Television Commercials And Television Ads

Ranjit Dhillon is an award winning and highly experienced Marketing Director, with a proven track record of driving an online business through effective and cost-efficient traffic generation, and multi-channel acquisition strategies.

Like many other markets, the TV market is purely governed by the forces of supply and demand

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    SUPPLY = Viewers

    DEMAND = Investment

    (These two factors set the station price)

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    Share of commercial audience

    Very little movement in share between larger sales points – market consolidation no longer driving the movement in share.

    MEMs has more than doubled its market share, Five and C4 have grown 0.26% and 0.95% respectively – likely to be a result of C4 putting Really onto Freeview

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    TV market mechanics

    Terrestrial TV costs can change by month (supply & demand)

    Month

    Indices vs. Annual Average (100)

    January

    77

    February

    82

    March

    100

    April

    130

    May

    121

    June

    102

    July

    96

    August

    87

    September

    108

    October

    110

    November

    109

    December

    82

    Average

    100

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    Different TV trading mechanics exist

    • Discount vs. average station price
    • Revenue / Impacts = Station Average Price
    • Negotiated discount dependent on a variety of factors including
    • Share & Volume of revenue relative to rival broadcasters
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    Cost per spot

    • Applicable to channels that naturally deliver smaller audiences
    • A mechanic rarely utilised by major broadcasters
    • Too much variation between predicted and actual performance
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    Fixed CPT

    (Cost of reaching 1,000 sets of eyes)

    • Favoured by DRTV advertisers
    • Removes a degree of fluctuation
    • Allows for more accurate forecasts
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    Regional macro factors

    TV is also traded against different audiences….but you may want to start with Adults

    There are 15 separate buying audiences

    • Adults is the cheapest route to market as it’s the broadest
    • Great for ROI focussed advertisers
    • Limits ability to access key programming
    • Broadcasters tend not to favour it as they make less money

    16 – 34 Men is often the most expensive audience

    • Young men are the hardest demographic to reach as they watch the least TV

    Buying 16 – 34 men in London is often the most expensive

    • Hardest demo to reach combined with most expensive region
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    Terrestrial TVs Regional Profile

    ITV1 = 12 individual regions

    • A National Broadcaster of programmes…But national airtime can only be achieved buying an ad in every region; even then it won’t appear at the same time in every region.

    Channel 4

    • C4 can be bought nationally; it can also be bought on a macro basis.
     

    NET

    LON

    SOU

    MID

    NOR

    SCO

    ULT

    GB

    ENG

    SLM

    SL

    All

    Adults

    100

    191

    103

    101

    68

    62

    91

    100

    105

    125

    133

    The cost of advertising in London is almost double the national average the cost of advertising. In Scotland is generally 38% cheaper than the national average, advertising in London is less viable to any Customer Acquisition business looking to generate an effective ROI due to the prohibitive entry costs.

    Time length factors vs. 30” (second)

    Second Length Factors

    10 seconds

    Simple attention message

    Reminder response message

    20 seconds

    Simple attention message

    Reminder response message

    30 seconds

    Most often recommended for brand and response ad

    40 seconds

    More complex response message – sectors that are heavily regulated

    Multiple propositions

    60 seconds

    Longer story telling either for emotional engagement or complicated selling techniques

    90 seconds

    Used, in the main, for highly demonstrable products that require a detailed level of explanation

    120 seconds

    See above

    • A 10 second costs 50% of a 30 second, although it only represents 33% of the length
    • A 20 second costs 83% of a 30 second although it only represents 67% of the length

    Longer time lengths tend to be preferred by DRTV advertisers as they allow for more detailed demonstrations and longer engagement with the message (e.g. 40-60 sec).

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