10 + 1 Ways to Lower Your Advertising Costs Right Now!
Thanks for downloading my executive primer on the “10 Ways to
Lower Your Advertising Costs Right Now!” This e-book is not
intended to be an exhaustive guide about everything you need to
know as that would run well over 1,000 pages. This primer is simply
intended to give you a good working knowledge on many of the
things that you can do yourself to lower your advertising costs
beginning now.
John Haggard, Principal Negotiator
Media Negotiator, a division of Revenue Developers
www.MediaNegotiator.us
300 Brunswick Place – Suite 100
Nashville, TN 37221
E-Mail:
[email protected]
Tel:
(615) 646-9636 Page 1 of 9
www.medianegotiator.us In order, these are the steps that you must take to maximize your
media expenditures. It is critical that you follow these steps in order,
or your results can be poor or even non-existent:
Step 1:
Creative First
Step 2:
Negotiation Second
Step 3:
Auditing Third
Creative First.
This is where most people blow it by spending a lot of money that
renders very little return because the creative is really not creative.
Much like you steer a car to where you want to go, you must properly
steer your prospects on where you want them to go. Nothing happens
unless the creative is exciting enough to move people from
spectators to participants to owners. A spectator says, “That’s
interesting.” A participant asks for more information to find out if the
product or service is a good price/value relationship and something
they would likely want. An owner is one who has bought from you and
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www.medianegotiator.us can be worth a lot of cash as a lifetime customer and as a referral
source.
Before you go on-line or on the air, it’s important that you understand
the nature of BROCA and how it impacts your prospects’
interpretation of your call-to-action media. If it’s not call-to-action, then
what you really have is an entertainment proposition that doesn’t
motivate anyone to take an real action, and this means little or no
cash income for you. Failure to understand BROCA will cost you
dearly in wasted ad dollars. In one sentence, your media ad cannot
be predictable; if it is, you will lose sales opportunities.
There are many ways to create direct-response media. The #1 thing
to always get the answer to, from the prospect’s point of view, is
“What’s in it for me?” Lou Holtz, speaker and famed football coach,
says it best this way: The 3 questions that all prospects ask, if only
subconsciously, are:
1.) Can I trust you?
2.) Do you care about me?
3.) Are you committed to excellence?
Your direct-response media should answer all three of the above
questions as “Yes.” Then, be sure that your media creation:
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www.medianegotiator.us 1. Is intrusive (you have to get the prospect’s attention);
2. Has a good offer (a “real” offer that would excite you if you were
buying);
3. Has believable logic to make doubters believe that the offer is
real as opposed to a gimmick;
4. Contains a sense of urgency, a time limit to “get the deal.”
Source: Roy Williams “The Wizard of Ads”
Negotiation Second.
After your creative is produced, now is the time for negotiation. I will
show you 10 ways to lower your costs. This primer will look at
television broadcast media. Other forms of media such as online and
radio have very similar offerings that can be negotiated using many of
the same techniques we use for broadcast.
1. Are you buying TV program averages? A program average is
the rating for a time period for a particular program and DOES
NOT INCLUDE other programs or one-time specials (such as
The Grammys, The Super Bowl, CMA Awards, etc.) that ran in
that same time slot. Rating means the estimated percentage of
the universe of TV households tuned to a program at once.
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www.medianegotiator.us Ratings are expressed as a percent. Universe is the estimated
number of actual households containing TV sets. For example,
if there are ten homes in the universe and three of the ten
homes are tuned to Channel 2, the rating that Channel 2 has is
30. If you are not buying a program average, the rating for the
time period that you are being shown could be much higher
than what “every day viewership” for the program really is. If the
Grammys pull a 12 rating for example, but the regular
programming that runs in the same time slot on all other nights
pulls only an 8 rating, you could be sold a higher “rating”
number than the true program average number, thereby making
you pay higher rates. Always ask for the program average
rating.
2. Are you being sold DMA Ratings or Household Ratings? There
is a big difference in the “number” you are being shown.
a. DMA is the designated marketing area (like ADI or Metro
are geographies of marketing areas). A DMA rating is a %
of all persons in a certain demographic age group (such
as Adults 25-54) tuned to a specific station and is
represented as a percentage of the number of TV
households.
b. A household rating is the number of households (and
contains all persons, no matter what their age) that are
tuned to a particular station and is represented as a
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www.medianegotiator.us percentage of all TV households. So if a seller shows you
a household rating as opposed to a DMA rating, the
“number” would look much larger, but some of the people
in that household may not be potential buyers or in the
demographic target you are interested in. Always ask for
the DMA demo rating.
3. Are you adjusting ratings (and costs) based on qualitative data?
Out of 100% of an audience, you may really only want 50% of
the 100% as the 50% you are really looking for may be the
ones who are high-income or who have other qualitative
characteristics. A station that is #1 in the 10PM news may be
#3 when you apply qualitative characteristics. The qualitative
adjustments is a good negotiating tool to lower your rates or to
get you bonus spots or other goodies.
4. Are you being sold projected ratings? If you have an upcoming
schedule, there are many ways to project what the program will
deliver in terms of a demo rating. How the projected rating is
calculated for each program will also determine how much the
station will try to charge you for your commercials. You want to
be sure that you are not being sold a projected rating that is
unrealistic that would cause you to pay a higher rate than you
should be paying. Demand also plays a role in TV station
pricing.
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www.medianegotiator.us 5. Are you posting your buys to be sure you are getting what you
paid for? Posting is the process of comparing the estimated
ratings generated from a buy against the reported ratings
provided by rating services. If the station does not deliver at
least 90% of the projected rating, you are owed make-goods for
missed rating points! We have seen businesses literally
leave THOUSANDS of dollars in free TV spots on the table
because they did not know anything about “posting,” and only a
handful of TV reps would ever tell you that the program you
bought did not deliver the promised rating.
6. Is the demographic target you are buying the right one for your
business? Never give a seller a demographic (demo) target
because they will price your schedule to the demo, and if the
demo is a favorable one for the station compared to the
competition, they will actually place a premium on the schedule
to charge you more.
7. Are you buying cost per point? Much like cost per thousand,
cost per rating point, known as CPP, is determined by taking
the cost of the spot and dividing it by the rating. CPP is the
comparison factor to determine whether or not you are getting a
fair deal on one station compared to the other stations. If the
CPP of the station you want to buy is high compared to the
CPP of the other stations, that’s a warning signal that further
negotiation needs to be done. Dominant stations can command
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www.medianegotiator.us a premium compared to other stations; you just want to be sure
that you are not over-paying for the “dominance.”
8. Are you buying the proper reach and frequency? Many buys fail
because the reach is poor and the frequency is below 3.0. If
your TV schedule is not reaching at least 45% of the demo
target and at a frequency (the number of times that the average
person will see your ad) of at least 3.0, your schedule is
doomed to fail. Every business operates on ratios, and the
advertising business is no different. With the huge number of
choices that today’s consumer has, an increased frequency to a
4.0 or 5.0 is even more desirable.
9. Are you using the proper ratings book for the buy you are
making? You should use the ratings book that is closest to the
time of year you are buying. For example, if you are planning a
buy for May and the month you are in right now is November,
don’t be sold a schedule that is based only on November
ratings! You could use the current November shares and last
May’s households using television (HUT levels) to project what
the upcoming May book will actually deliver, or you might just
use the most recent straight May book to determine ratings
performance.
10.
Does your advertising contain IOLU? As referenced
earlier, your ad should be intrusive (you have to get the
prospect’s attention); have a good offer; have believable logic
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www.medianegotiator.us to make doubters believe that the offer is real as opposed to a
gimmick; and contain a sense of urgency, a time limit to “get the
deal.” If you have never read the book “The Wizard of Ads” by
Roy Williams, you should get it now.
11.
Do you subscribe to the ratings to see what the REAL
numbers are? Sellers can show you all kinds of “numbers.”
Knowledge is power when applied. If you really want to know
what is REALLY going on in the ratings world, you should
subscribe to the ratings to see a non-manipulated rendering of
what’s real.
If you follow these 11 steps, you will be able to buy more, reach
more, and spend less.
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