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									                                             MEDIA RESEARCH CLUB OF CHICAGO

                                                  M                   R              C                  C


                                             REVIEW
                                             The newsletter for all media professionals


            The Future of Television                                                The good news is that technology now makes possible the
                                                                                 automated delivery of targeted commercials down to each of
                  Advertising                                                    the individual cable zones. This enables more granular
         Claudio Marcus                                                          targeting for larger advertisers who buy a market interconnect
         Visible World                                                           at efficient DMA-wide media rates. Such interconnects,
                                                                                 available in most major U.S. markets, are
                                                                                 often comprised of dozens of individual                 MRCC OFFICERS

         E
              veryone agrees that technology will impact the future of
              TV advertising. But the question is whether that impact            cable zones, providing advertisers with          President, Brent Lightfoot
              with be positive or negative.                                      sufficient geo-demographic diversity to          SRDS
            Bob Liodice, President and CEO of the Association of National        enable effective TV ad targeting.                1700 Higgins Road
         Advertisers (ANA), recently used TiVo to illustrate the potentially           Although not widely deployed, the delivery Des Plaines, IL 60018-5605
                                                                                 of household-level targeted TV ads is already    Ph: 847-375-5000
         negative impact of technology on TV advertising; advertisers are
                                                                                                                                  bligh@srds.com
         worried about the impact of digital recording technologies. But         technically feasible. As digital cable and
         Liodice went on to cite Visible World’s targeted                                            satellite set-top boxes      VP-Programs, Judy Bahary
         customized TV advertising capabilities as an                                                become increasingly capable Starcom Worldwide
         example of the positive impact technology can                                               and widespread, deployment 35 W. Wacker
                               have. He said, “Visible                                               of household-level TV ad     Chicago, IL 60601
   Table of Contents           World allows us to use                                                targeting will become more 312-220-1466
                                                                                                                                  Judy.Bahary@starcomworldwide.com
                               marketing investments                                                 broadly available.
President’s Notes ........2 more productively and to
                                                                                                                                       VP Administration, Julie Erbe
Upcoming Events........2 target messages to                                                          Customization                     Mediamark Research, Inc.
                               customers who have a                                                     Some advertisers deal          444 N. Michigan Ave., Suite 2050
Meeting Information ....2 propensity to buy products                                                 with diverse consumer             Chicago, IL 60611
FYI ........................6 we're marketing to them.”1                                             segments by using multiple        312-644-0641
                                 To help understand                                                  versions of the same              jerbe@mediamark.nopworld.com
         what the future holds for TV advertising, this                                              commercial. For example,
                                                                                                                                    Treasurer, Tony Hereau
         article summarizes three key applications                                                   automotive and retail          Arbitron
         enabled by Visible World’s technology, tools                                                advertisers sometimes alter 222 S. Riverside Plaza
         and services: targeting, customization and dynamicism.                  their TV ads based on specific DMA market          Chicago, IL 60606
                                                                                 and competitive requirements. But most             312-542-1869
         Targeting                                                               advertisers still rely on few if any versions.     Tony.Hereau@arbitron.com
            TV ad targeting - sometimes referred to as addressable               This isn’t because it can’t be done; versions
                                                                                                                                    Secretary, Kristen Latkowski
         television advertising - involves the delivery of specific content to   can be created for different audience              Arbitron
         a specific audience. Even TV ads aired on a national basis often        demographics, product uses, dayparts or            222 S. Riverside Plaza
         rely on some degree of targeting based on the program, network          DMAs in which a commercial airs. The trouble Chicago, IL 60606
         or daypart demographics. It is also relatively common for major         is that the conventional process for the           312-542-1867
         advertisers to use geographic targeting to deal with DMA-level          creation, trafficking and delivery of multiple     Kristen.Latkowski@arbitron.com
         market opportunities, preferences or competitive environment.           versions is both cumbersome and costly.
            Local advertisers have long been able to buy local cable zones,          Today, technology is changing this situation.
         which are roughly the population of a city neighborhood, suburb or      It enables the dynamic creation and automated delivery of
         small town. Unfortunately, the related local media rate premium         customized TV ads; versions of spots are generated based on
         and manual trafficking has historically made this approach too          specific advertiser criteria regarding when and where a particular
         costly and cumbersome for most large advertisers.                       execution airs.                                 continued on page 5



                                                      A u g u s t                      2 0 0 5
                 PRESIDENT’S NOTES
                                                                                                                    August
               by Brent Lightfoot
               SRDS
                                                                                                                 Meeting Notice

                                                                                                                 PLEASE RSVP!

                   Summer Time Reflections                                                               Topic     3rd Annual Preview of the New
                                                                                                                   Fall Season
    By now, summer is officially in full-swing, and  programming? How will advertisers respond           Speaker   Sam Armando, Starcom Mediavest
research shows that about half of you have been      when a show with some redeeming social value,                 Group
on some sort of a vacation or have attended a        in my opinion, has been pulled – while other
wedding. You may also have enjoyed some family       exploitative fare like “The Littlest Groom” is      Date      August 9th, 2005
reunions and birthday parties. Possibly, you         deemed “acceptable” for the viewing public? I
have gotten too much sun or had too much to          would be interested in hearing your comments.       Place     Maggiano’s Banquets
eat. Personally, I have not played nearly enough        I want to thank Starcom and Comcast again                  111 W. Grand Avenue
golf for summer to be past its midway point.         for their support of the MRCC summer                          The Amarone Room
    Summer will now start winding down and back-     internship program. Dana Grunthaner, who is
to-school season is approaching. That can mean       working toward her B.S. in Advertising at the       Time      Noon to 2 p.m.
only one thing at the MRCC: the fall television      University of Illinois, has been interning with
lineup! Sam Armando from Starcom will preside        Comcast. Dana is also a Co-Chair of the             Price     $35 member
at this month’s meeting, when he                                         National Student Advertising              $45 non-member
will present videos to show us the                                       Campaign with the American
programs we might tell our clients                                       Advertising Federation. She     Menu      Buffet-style lunch
are going to be the next big hits.                                       expects to graduate in May
                                              Save the date –                                            RSVP      FAX your reservation to
What will be the next American                                           2006. Starcom welcomed
Idol? What will be the next                                                                                        312-329-0443 or RSVP at
                                           Tuesday, October 11 Ann Belusko, who is working
Desperate Housewives? I can’t                                            toward a B.S. in Business                 www.mrcc-online.com by
wait to see what the networks have        – for the MRCC Expo! Administration with a double                        noon THURSDAY, August 4th.
cooked up this year for the next big                                     major in Marketing and                    Cancellations must be received
reality hit. Will it be Martha Stewart?                                  Operations Management. Ann
    An interesting development in                                        is involved in the American
                                                                                                                   by this date.
reality programming also has me                                          Marketing Association and is
thinking about the future of the genre. Recently     expecting to graduate from Marquette                   NOTE: Be sure to RSVP to guarantee
ABC announced they were shelving its six-            University in December 2005.                           yourself a seat. We can only handle a
episode reality series "Welcome to the                  Last but not least, our plans are set for the
                                                                                                                 small number of walk-ins.
Neighborhood”, which had been scheduled to           Fall Expo. Save the date – Tuesday, October 11
debut July 10. The premise of the show was that      – for a super-sized MRCC luncheon. The Expo
non-traditional families would compete to be         will take place from 11 a.m. until 2:30 p.m. at
selected to win a new house. Apparently, some        Maggiano’s, and will feature both a special guest
groups were concerned that if audiences only         speaker and the opportunity to see what is new
viewed portions of the episodes, they would          in the field of research. If you are a vendor and
come away thinking that intolerance is               would like to participle, please contact Danny
acceptable. I think it could make for a good show    Miletic at danny_miletic@cable.comcast.com                       September 13 — MRCC
– that viewers would have to confront their own      by September 6.
                                                                                                                       Luncheon and Expo
religious, sexual, racial, and economic biases –        See you at the Fall Preview luncheon
and ultimately actually learn something about        on August 9th and enjoy the rest of the                            September 26 - 30 —
themselves. What does this bode for reality          summer. MRCC
                                                                                                                          Advertising Week in
                                                                                                                            New York City

                                                                                                           October 23 - 26 — Worldwide
                        RSVP by Credit Card                                                                Readership Research Symposium
                                                                                                           in Prague
   Note: The MRCC has made arrangements to accept credit cards via PayPal (Visa, MC,
Amex, Discover). This must be done when registering online. Credit cards cannot be accepted
at the door. Please be aware that there will be an additional 4% processing fee when paying
by credit card.


 2     M R C C     REVIEW
 One Solution to the                               2004-2005 Broadcast Season

  Media Industry’s                                                          Television                    Product                     Increase in
ChallengesSurrounding                                Network             Commercial Units             Placement Units              Promotional time
Commercial Skipping                                  ABC                      17,974                          1,562                         9%

Annie Touliatos                                      CBS                      16,269                          2,885                        18%
Nielsen Media Research                               FOX                      11,794                          2,240                        19%

                                                     NBC                      17,366                          4,542                        26%

P
       roduct placement has gained significant
       attention in recent years, after years of
                                                     UPN                       8,063                          1,816                        23%
       inattention, despite this form being the
first mode of advertising on television. To          WB                       11,591                          1.832                        16%
meet the challenges of the changing media
landscape within television households,              Units equivalized to 30 seconds
advertisers clamber to get the attention of
consumers in meaningful and unique ways.
                                                   Top New Brands Featured within Programming
As more households acquire technology such
                                                   2004-2005 Broadcast Season
as digital video recorders (DVR’s), the industry
is now seeing a trend toward a redirection                                                         Duration            Duration Comparison
in promotional tactics for television.               Brand                                     (in seconds)     (30 second commercial equivalent units)
    Responding to the growth of this non-
traditional advertising, Nielsen Media Research      24 Hour Fitness Fitness Centers-Clubs          3,384                        113
launched a product placement service, with the       Deist Safety Auto Parts-Accessories            1,098                          37
beginning of the 2003-2004 broadcast season.
Nielsen’s service provides granular data for         Chrysler Le Baron Autos                          615                          21
all brand occurrences within primetime on
broadcast television. Place*Views, the web-          Prevost Car Vehicle Miscellaneous                597                          20
based software deliverable, allows clients to        Garnier Fructis Style Styling Gel Surf Hair      368                          12
identify which brands are featured, what type of
placement is being used, when and where the
placement has occurred, and the audience size
and demographic composition for the program
minute at the time of the placement.
    A review of the past two broadcast seasons
displays a relatively flat growth for total ad
time, roughly 2%, while the product placement
opportunities continue to expand, with 30%
growth in that same time period. Broadcast
networks have been able to extend their total
advertising air time by up to 26% and delivery
of total households by up to 30%, through
product placement. The chart on the right
displays the six broadcast networks’ ad units
and product placements on television.
    Nielsen’s product placement service does
not decipher whether the brand occurrences
were planned and/or paid for. However,
through recent industry articles and data
that Nielsen provides, it is clear that more
advertisers are moving in this direction.
For the combination of the ‘03-‘04 and ‘04-
‘05 television seasons, there were more
than 7,500 brands featured in primetime
programming. Procter & Gamble and Coca-
Cola have been the leading advertisers using
product placement, and continue to be the
focus of the industry through some of their
well-publicized product integration deals.
                            continued on page 4
                                                                                                                            M R C C      REVIEW       3
                                                                                       One Solution…, continued from page 3
24 Hour Fitness Centers-Clubs
2004-2005 Broadcast Season
                                                                                            …in the ‘03-‘04 and ‘04-‘05
                                                                                           television seasons, there were
                                                                                         more than 7,500 brands featured
                                                                                             in primetime programming

                                                                                          The most compelling information is the
                                                                                       number of advertisers embracing this revived
                                                                                       form of advertising. Comparing the 2003-04
Top 10 Brands                                   Top 10 Brands                          and 2004-05 broadcast seasons there are
2003-2004 Broadcast Season                      2004-2005 Broadcast Season             more than 1,500 advertisers representing
 Netzero Internet Service Provider              Netzero Internet Service Provider      over 3,000 brands appearing in primetime
                                                                                       programming on the six broadcast networks
 Coca-Cola Classic Regular Soft Drink           Coca-Cola Classic Regular Soft Drink   for the first time. The most notable new
 Ford Autos                                     Everlast Apparel                       brand is 24 Hour Fitness Centers-Clubs with
                                                                                       nearly 1 hour of product placement activity
 Nike Apparel                                   Everlast Sporting Equipment
                                                                                       this past season, attributable to their
 Ford Trucks                                    Cingular Wireless                      storyline integration on NBC’s “The Biggest
 AT&T Wireless Telephone Services               Nike Apparel                           Loser”. Their in-program promotional activity
                                                                                       contributed roughly 43% of total ratings
 Boston Red Sox Baseball Team                   Foot Locker Stores – Shoes
                                                                                       delivery for adults 18-49.
 Lincoln Autos                                  Nike Air Jordan Apparel Mens              As this new advertising alternative
 Mercedes-Benz Autos                            Ford Trucks                            continues to grow and more industry
                                                                                       standards are developed, we expect that
 GMC Trucks                                     Ford Autos
                                                                                       more brands will take lead roles within the
 Top 10 brands ranked by total duration                                                content of programs. Major networks and
                                                                                       advertisers have begun to advise the
                                                                                       television industry to expect significant
                                                                                       increases in product placement activity this
                                                                                       coming broadcast season. Advertisers and
                                                                                       media companies are now grappling with the
                                                                                       notion of understanding the value of these
                                                                                       placements and how to insert this new
      Find continuously updated data                                                   strategy into their marketing plan.
            to identify TV stations                                                       Several ideas and approaches for this
                                                                                       needed value are being examined by various
        that meet my needs.                                                            buyers, sellers, and research companies, but
                      I can do that – online.                                          no standard has yet been set. In partnership
                                                                                       with our clients, Nielsen is conducting a large
                                                                                       scale primary research study to analyze all
                                                                                       the different elements of product placement
           TV & Cable Source®
                                                                                       to determine the factors that contribute to
            • Current information on all broadcast, cable, syndicated                  the impact of placements. The results of this
              and alternative television advertising opportunities                     study will help the industry gain a better
            • Links to e-mails, Web sites and programming schedules                    understanding of the value that this new
            • Create contact and traffic specification reports                         strategy brings to their brands so that future
                                                                                       decisions can be based on diligent research.
                                                                                       We are looking forward to an upcoming
                                                                                       season of increased product placement
            S R D S. A LW AY S                THERE.                                   activity, along with additional metrics and
                                                                                       tools to help navigate through this
                                                                                       transforming medium. MRCC
            Call 800.851.7737 today to subscribe.
                                                                                       Annie Touliatos is Director, Product Development
                                          www.SRDS.com
                                                                                       & Marketing, Nielsen Media Research

4     M R C C     REVIEW
The Future…, continued from page 1
   New tools specifically developed to manage         Day-to-day distractions and ingrained business       Alternative Scenario:                  Fast
scenario-based creative development and               practices often slow the logical adoption of         Track to Holy Grail
the related post-production process make it           these new approaches.                                    Given the potential benefit that household-level
possible to create dozens or even hundreds                                                                 television advertising presents to advertisers,
                                                      Current Outlook: Progress                            there is inherent value in accelerating industry
of versions in a fraction of the time and cost        Happens Slowly
previously required. Since content production                                                              efforts to reach this worthy goal.
                                                         How long will it take for advertisers and             Most likely, a successful effort will bring
represents a small fraction relative to the           agencies to fully leverage these new capabilities?
larger media expenditures, in most cases                                                                   together major advertisers who are interested,
                                                      They will likely continue to dabble in some way      willing and able to commit resources to make
incremental production costs can be readily           or another. Some will take a more tactical
justified based on the improved return on the                                                              broad deployment of household-level advertising
                                                      approach and focus on the more immediate             capabilities a reality in an accelerated timeframe.
related media investments.                            benefits associated with either dynamic content
   Customization can increase the relevance                                                                Such a distinguished advertiser coalition could
                                                      update or targeting and customization                effectively plead its case to industry operators
of TV spots, reducing the minimum frequency           capabilities. Many will look to minimize potential
a commercial must run to be effective. At                                                                  and take the lead in developing a cohesive plan for
                                                      disruptions to current creative development          implementation; the plan would take on key issues
the same time, context or exposure-based              and media planning efforts.
customization can help reduce TV ad wear-out,                                                              such as operators’ economic expectations,
                                                         A few advertisers will take a more strategic      advertisers’ and agencies’ need to efficiently
thus extending the maximum effective frequency.       path to leverage and integrate targeting,
   TV ad customization will become even                                                                    produce, version and manage a considerably
                                                      customization and dynamicism, especially in          richer array of TV messages, as well as
more critical as targeting becomes more               the context of their key business opportunities.
prevalent. The reason is straightforward:                                                                  consumer concerns with potential privacy issues.
                                                      This approach seeks to extract value along the           The current pressure to enhance the value
the value of a customized message increases           path to the eventual promised land of
as the profile of a viewer segment and the                                                                 of TV advertising makes the opportunity to
                                                      household-level TV advertising. As pioneers,         accelerate its transformation more than wishful
context of the message narrow.                        these advertisers will face many hurdles             thinking. Such a transformation would ensure
Dynamicism                                            in working with their agencies and the many          that television remains an effective advertising
    The usual TV advertising production and           industry operators. Still, over the next three       medium for many years to come. MRCC
delivery process fails to accommodate changing        to five years, operators will continue to expand
marketplace factors that could be used to             their efforts to support increasingly targeted,      Claudio Marcus is Executive Vice President of
enhance commercial content when it airs.              customized and dynamic TV advertising. Some          Market Development at Visible World.
    Television commercials today are much like        advertisers will succeed in transforming their
                                                                                                           1
                                                      advertising efforts to reap substantial               ANA Annual TV Forum 2005, Bob Liodice
static web pages. But the web has evolved to
                                                      competitive and economic advantages.                 Keynote Presentation, March 2005
support the delivery of dynamic web pages,
where content is brought together in real-time,
often from various sources. Technology now
enables TV ads to behave similarly; they are
dynamically customized through the use of
templates and content, driven by business rules.
                                                                                              apples meet oranges
    Dynamic TV ad capabilities enable marketers
to readily adapt and update time-sensitive                                                PERQ/HCI Non-Journal Media Study
content in their commercials. One obvious
reason to use more dynamic TV spots is the                                                  • Conduct significant comparisons among
need to react to changing market conditions.                                                  non-journal healthcare media
Another is to better align TV advertising with                                              • Even the playing field and predict
online or offline media and promotional efforts.                                              message penetration
Dell Computer updates its offers online several                                             • Select promotional media that will most
times a day. Why not update offers advertised                                                 effectively deliver your message
on TV just as frequently?
                                                                                                - Electronic Media - References
    The ability to dynamically update content
of a TV spot offers significant business benefits                                               - Patient Rx Forms - Other
in addition to meaningful time and cost
efficiencies. Used in conjunction with targeting          Make meaningful comparisons of non-journal healthcare
and customization, dynamic update capabilities
enable advertisers to cost efficiently fine-tune TV
                                                          media, and improve your return on investment.
ad messaging down to specific narrowcast
viewer segments.                                          Call Stephen Davis at
    This brave new world of TV advertising is             800.243.2702 ext. 235.
promising, but it also can be somewhat
intimidating to many advertisers and
agencies. Some have already started to take
advantage but few have made the conscious                                                                                 www.PERQ-HCI.com
effort to fully leverage these new capabilities.
                                                                                                                                 M R C C     REVIEW       5
              LOOK FOR AUGUST MEETING NOTICE ON PAGE 2.




                                                                                      Chicago, IL 60681-0874
                                                                                      P.O. Box 81874
                                                                                                     MRCC



                               NSI will roll out its Local People Meter in Dallas and Detroit in January 2006, and Atlanta in

                               July 2006. NSI will also report time-shifting in Local People Meter markets in January 2006

                               …… Media Analysts introduces a new web application with many features the industry has

                               requested such as Ranking reports, Recipe reports, and Competitive reports. Please contact

Marjorie MacDonald at mmacdonald@mediaanalysts.com for more information …… Time saving technology available

through Strata includes the ability to upload broadcast orders and receive invoices electronically. Contact Peter Nason at

312-222-1555, ext. 144 or pnason@strataG.com to receive more information …… Scarborough has completed delivery

of all 75 of its local market studies for the first release of 2005. Delivery of R 2 2005 data will begin in October 2005

…… Arbitron's Houston Personal People Meter (PPM) panel is now fully installed. Data on the panel's exposure to radio,

TV and retail store visits is being collected with more than 50 local and national retailers having encoded their in-store

audio for the PPM demonstration …… MRI's Doublebase 2005 Demographic/Media data was released on June 27th,

2005. "The Influentials," a key component to word-of-mouth advertising, is now available in the Spring 2005 study and is

free to all MRI subscribers. Please call your MRI representative at 800-245-1551.

                                                                                        The MRCC Review is published 9 times a year.
       FAX YOUR MRCC RESERVATION!
                                                                                        Address       Mark Tuinstra, CMR
FAX TO: KRISTEN LATKOWSKI AT ARBITRON                                                   changes:      mark.tuinstra@tns-mi.com

If you would like to fax us your lunch reservation, please fill out the information     Advertising: Bernie Cognac, SRDS
                                                                                                      Phone: 847-375-5188
below and fax it to the MRCC reservation line at 312-542-1801 by August 4th.
                                                                                                      bernie.cognac@srds.com
   Name ______________________________________________________                          FYI:          Matt Wolff, Claritas
                                                                                                      mwolff@claritas.com
   Company____________________________________________________                                        fax 312-583-5403

   Phone # ____________________________________________________                         Membership: Mark Tuinstra, CMR
                                                                                                      mark.tuinstra@TNSMI-CMR.com
                  ❏ Member ($35) ❏ Non-Member ($45)                                     Editorial:    Helen Katz, SMG
                No shows will be billed — cancellations must be                                       Phone: 312-220-6706
                     received 24 hours prior to meeting.                                              Helen.katz@smvgroup.com

								
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