Media Buying, Demystified

Many moons ago, media buying used to be a straight-forward affair. Your big three options were network television, print, and radio. Technology has completely transformed the media landscape, and the 21st century is now a complex world of media formats. What is a media buyer, a corporate marketing director, or a small business owner to do? I would like to shed some light on the issue for those not familiar with the options available today.

First, let’s take a look at a list of various formats:

• Television (major network and cable in the form of commercials and product placement)
• Print (magazines, newspapers, directmail, phonebooks, outdoor, inline merchandising, tradeshow materials, etc.)
• Radio (terrestrial, satellite and Internet)
• Online Display Advertising (rich media, banners)
• Pay-Per-Click Search
• Email
• Disc/Optical Media (CD-ROMs and DVDs)
• Podcasting
• Mobile Marketing (text messaging)
• Video Display Networks
• Specialty Websites (microsites, blogs, social networks)

Even though this is an extensive list, it does not cover all the possibilities. However, you get the point by seeing all the different options available today. Now the questions are: what to use, when to use it and how much to use it? A number of factors determine the answer to these questions. Each situation is unique and should be treated appropriately in order to maximize results.

One factor to consider is overall production costs. For example, developing a full-color, multipage print catalog for direct mail is more expensive than designing a single display ad for a magazine. However, the distribution of the display ad can end up costing more than shipping the print catalog if the display ad is placed in a high-end publication with a wide circulation. Which leads to the next consideration, how much will it cost to reach each prospect, and what are the incremental costs for the frequency of reaching those prospects?

A general rule of marketing is to reach your target market (not just anyone, your specific target market) with numerous impressions (frequency). It normally takes consumers seven impressions to act upon a marketer’s call-to-action. Of course that number can vary depending upon a number of factors, but it is a general rule of thumb to help examine your media plan. A traditional metric to use is CPM or cost per thousand impressions. However, with new media formats, such as pay-per-click advertising, marketers do not pay on a per-impression basis but rather on a click-through basis.

To help account for the different formats, the CPA or cost per acquisition metric can be used. This metric defines the cumulative cost of acquiring a conversion in the form of a lead or actual sale. For example, a client of mine recently informed me that the email campaign we executed for him was far more cost-effective than a television campaign that ran during the same period. The goal of both campaigns was to attract definitive leads through contact initiated by the viewer. The television campaign delivered a CPA of over $600 per lead acquired. The email campaign delivered a CPA of a little over $3 per lead acquired — quite a difference.

In addition to all the quantitative data to analyze, qualitative considerations exist. Primarily, what is the impact of the media format you are utilizing? Visual media incorporating sound, video and motion generally are more impactful than a static medium such as a classified ad. That’s an extreme comparison, but I use it to illustrate my point. One of the great aspects of interactive media is the ability to optimize these qualitative features such as creative execution in order to maximize results. For example, producing a multitude of emails for a campaign will have the same costs for production and delivery. However, the qualitative impact can be varied by applying different creative to the subject line and the email message itself. By producing similar emails but altering the creative slightly between each email, A/B testing is performed on a small sample of your target to determine which email is most effective. From that point, the more impactful email is delivered to the rest of the target market for optimal results.

Media planning and buying can prove to be extremely complex. It takes specialized expertise in order to successfully plan a strategic campaign. I strongly recommend employing expert professionals for assistance. Either independent consultants or agencies can aid in this process. Do not underestimate the value of strategic planning in addition to the execution of a campaign. Good luck with your next marketing campaign, and remember to plan for an integrated media approach.

To learn more about media buying, please contact us at 949.215.1250.