Tuesday, April 27, 2010

How Radio & TV Ratings Work (Part Two)

First, read what I wrote last week by clicking here, if you have not yet read Part One.

Welcome back.

We're jumping into this with both feet which is why you needed the background info I wrote last week.

Every week, I receive phone calls and emails from advertising agencies around the country wanting information on the radio stations I represent. Usually it is the Media Buyer who is looking for the best way to spend their clients money.

What they are usually looking for is something called Reach & Frequency. That's good. However how they measure the effectiveness is what I question.

(Reach refers to how many individual people the commercial will reach and is based on the size of the radio stations audience and the number of ads that air for the business.

Frequency refers to how often each individual listener will hear the commercial.)

Terms like Cost Per Point and Gross Rating Points are on their list of items to work with.

Arbitron defines these terms:

Gross Rating Points (GRPs)

The sum of all rating points achieved for a particular spot schedule.

[AQH Rating] x [the number of spots in an advertising schedule] = GRPs

Cost Per Rating Point

The cost of reaching an Average Quarter-Hour Persons audience that's equivalent to one percent of the population in a given demographic group.

[Cost of Schedule] / [GRP] = Cost Per Rating Point
[Spot Cost] / [AQH Rating] = Cost Per Rating Point

These mathematical calculations can result in some pretty weird advertising schedules.

But my biggest complaint is that it is often short term thinking based on flawed numbers to begin with.

So, when I work with clients who are not represented by an advertising agency media buyer, I use what I call common sense. And usually that common sense tells me that it is best for my client to "dominate a daypart".

Radio Dayparts are 6am to 10am (morning drivetime) 10am-3pm (mid-days) 3pm-7pm (afternoon drivetime) 7pm-12midnight (evenings) and 12midnight to 6am (overnights).

To dominate a daypart, my client should air at least 3 out of 4 hours in mornings or afternoons, or 3 out of 5 hours in mid-days and evenings. This creates a stronger impression on listeners than what some of the crazy schedules I see coming from media buyers, where I will see 5 ads in mid-days for an entire 5 days versus my formula which says you should air 15 times, minimum during that same 5 hour a day, 5 day a week time period.

Please understand that I'm not insulting media buyers. Most have been trained to buy by the numbers and formulas. As a matter of fact, I will often propose an advertising schedule to the media buyers I work with based on the daypart domination that I explained.

I think next week, we'll talk about how to increase the effectiveness of your advertisement, that has nothing to do with ratings. Your comments are always welcome.

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