Lecture 3/10 - Advertising

Intro to Media Systems and Processes Lecture 3/10 - Advertising ______________________________________________________________________ Advertising: the Beast That Has Eaten America Psychological Advantages Access Advertising reaches people anyplace, anytime, anywhere (i.e. Beach planes trailing advertisement banners Timeliness Advertisers know exactly when to place ads about different products/services to reach proper audiences Ability to Demonstrate Showy displays of a products?/services? efficacy Entertainment Value Attention Holding Value Status Value Flexibility of Coverage in Old Media 75% of all radio advertising is local Top Billing Radio Stations in 2007 (no need to memorize) KROQ/Los Angeles/Rock KIIS/Los Angeles/CHR WLTW/New York City/AC KFI/Los Angeles/Talk WINS/NYC/News Average cost of a 30 second radio spot ranges from $1400 in NYC to $200 in Miami 40% of all television revenue is local The Changing Placement of Advertising Online Video Ads - up 45% Mobile Ads - up 42.6% Social Media - up 37.4% Gaming - up 27.4% Newspaper Ads - down 7% Radio Ads - down 1% Magazine Ads - down 1% Network TV Ad Spending 2004: up 11.5% 2008: up 1.6% Flexibility of Advertising on Network Media Local Co-op - when the cost of an ad is shared by the local retailer and the manufacturer Double Billing - When the local retailer and local media outlet conspire to charge manufacturer twice for the same commercial Advantages of Network Radio and TV Advertising Centralized control More sophisticated audience research One transaction Prestige of advertising on a national network Advantages of New Media Advertising Cheaper Reach worldwide audience in a global economy Text advertising: anytime, anywhere Everyone has it Ways to Present Your Message Sponsorship - one sponsor per show Participatory - many sponsors for one show Network Co-op - permits affiliates to place ads during network TV time Network Spot Advertising An alternative to network advertising Reaches network audience in a cheaper way ?An ad-hoc collection of non-connected stations chosen to suit the advertiser?s needs? How and Where Do You Place an Ad? Natural break A break in a show?s action in which a commercial fits neatly, i.e. the end of an inning in baseball Contrived break ?TV timeouts? and anywhere that advertising is inserted arbitrarily, without regard for natural flow of programming, i.e. product placement Station break When a station is required by law to pause programming and identify itself (?You are listening to 93.3 WMMR, Philly?s Rock Station, MMR Rocks!) Advertisers take advantage of this time to market their products Public Service Announcements Back Announcements Advertisers buy 60 second spots that air after a DJ announces a song but before the song is actually played Infomercials SYNDEX Rule: when a station signs a contract to put a syndicated show on, it has the exclusive right to air it in their area/viewing community Rate Determinates Stable Factors Market Size Station Facilities How big a station is Network Affiliation Dynamic Factors Programming Promotion Sales CPM (Cost Per (M)Thousand) - the number in thousands of people or households reached by a message divided into the charges for disseminating the message (only as good as the research used) Radio Dayparts Morning drive (most profitable) Afternoon drive Midday Other Subclasses Fixed position - guaranteed spot Run-of-Schedule - anywhere in a time period Preemptibility - cut-rate opening, can run at anytime of the day and be cut for a higher rate ad Television Dayparts Early morning, morning, afternoon, early fringe, news block, access, prime time, late fringe, overnight Legal Issues Proof of Performance Stations need to prove that they are honoring their contracts They keep programming logs to prove that they are running the contracts they are paid to run Makegood Clause that determines recompense to an advertiser for a commercial paid for but not run Payola The direct payment to DJs for airtime Alan Freed Dick Clark Plugola The indirect payment by way of ?plugs?