COMM 122 1st Edition Lecture 10Outline of Last Lecture I. NewsII. AdvertisingIII. Cost to Produce a Commercial IV. Buying and Selling AdsV. Advertising ComponentsVI. Advertising in the 17th CenturyVII. Commercial ClutterVIII. CPMIX. Advertising Termsa. Per-inquiry Adsb. Clippingc. Adjacencies d. Pode. Cooperative Advertising f. Double BillingOutline of Current Lecture I. Net neutralityII. Audience MeasurementIII. Ad TimelinessIV. Ratings These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.V. Coalition for Innovative Media MeasureVI. Weighting VII. SWEEPSVIII. Shares Current LectureFCC voted in favor of net neutrality (common carrier) The media determines what the regulations are, congress agrees- Cable industries gives hundreds of millions of dollars to Congress to get the laws they want- Ready to sue the FCC—hearings and investigations to watch them fight it out Advertising agenciesMEDIA --------------------------ADVERTISERS - Media: People selling eyeballs - Advertisers: people looking for eyeballs - Most advertisers don’t make their own ads o Conduct research (surveys, focus groups)o Design/supervise campaignso Represent sponsors to mediao Decide where to buy media time/spaceo Produce the adso Pay the media Work for advertiser, not the media Traditionally, 15% commission—for $200,000 network spot: - $170,000 for network- $30,000 for agencyo Advertisers pay the production cost- Rely on National Sale Reps who put together packages of stations (good at attracting people of different demographics)—agencies don’t have to have knowledge of how to reach specific groups in specific placeso National spots (non-network)—group of stations Station buys 30-minute sitcom, 22 min show, 6 min of advertising—station buys show and has 6 minutes of advertising to sell - Barter syndication: when the station gets the – provides the program for less money, but3 minutes of advertising are already sold- Commercials (some) included with (free) programmingAdvertisers want to know if the ad is actually appearing when it is supposed to - Broadcast Advertising Reports: the ad appears when it is supposed to (verification services)o Before 1941: every station had to keep a computerized log of every commercial o Stations no longer required to keep track of all the ad paper in the 80’s (because of deregulationo Advertisers still want to know if they are appearing so they hire people to check and see - VEIL (Video Encoded Invisible Light): Every ad is embedded with certain special codes to make sure the ad goes ono Many come and go: TNS, Media Monitors, Audible Magic, Confirmedia, MediaGuide, Aircheck, Eloda, ScanAmerica, TeleTrax, KeepingTrac… All helping each media service put together materials so they can attract advertisers:- RAB (Radio Advertising Bureau): works with stations to do surveys, brochures, and selling tools—promotional and publicity materials created (want to attract local ads)- TvB (Television Advertising Bureau)- CAB (Cable Advertising Bureau): helps put together cable packages - IAB (Interactive Advertising Bureau)Ratings: the fundamental line that programmers use to decide the fate of programming - Determine how much they can charge for advertising—no limit to how much a website can charge for a commercial (it is whatever the market will allow)- It is the only measure of performance - Simplest most basic form of audience research- Rating wants to know:o How many are watching? (“Tonnage”)o Who are they? (age and sex—demographics)- Traditional: there used to be no obvious way to see how many people are watching o Rely on Nielson and Arbitron to provide ratings o Nielson has an utter monopoly—Arbitron is now Nielson Audio ($1.3 billion)—watching us for up to 8 hours per day  They can see what people are doing simultaneously Coalition for Innovative Media Measure (coalition that is going to do research and put out proposals to determine new ways to measure viewers)—people watch tv on so many devices now—find better ways to measure viewing- 2009: Time Warner, Disney, News Corp., Viacom, proctor and Gable, AT&T, CBS, Discovery, NBC- now over 20 companieso Computers, Laptops, smart phones, tablets—they develop new ways to measure viewing across multiple platforms (DVR, On Demand, on-line, mobile, game consoles, etc.) and set–top box data (makes all results publicly available)- Normally, the traditional rating is based o Add how many people saw it within 7 days o Although traditional tracking is the most common, on demand and streaming sites not being counted and are attracting viewers (networks not getting paid) Extremely expensive (millions of dollars to collect the data)Ratings represent feedback to the networks about what people like and don’t like- Ratings= cultural democracy (voting is watching or not watching)—vote on whether we like it or not (watching counts towards voting)—controlled by viewers - Not everyone’s vote counts equally:o High ratings don’t guarantee success—if the “Wrong” audience or too expensive (younger viewers wanted)  Networks that are popular may have huge audiences but the audiences are attracting the wrong demographicso Not everyone gets to “vote”—adequate representations of minorities—minorities under sampled (sometimes advertisers don’t care much because minorities often don’t have as much spendable income)Revelation about how advertisers view minorities: memo warning advertisers not too buy too much advertising time on ethnic stations because you would lose the opportunity to reach the more important people (reaching suspects not prospects) - Represent a lack of cultural diversity Weighting: equalizing the differences in the sampling - If the group= 10% of the populations, but 8% of sample (Weighted by 1.25—8 x 1.25= 10)- If the group is 10% of the populations, but 1% of the sample (Weighted by 10—1 x 10=10)o Becomes very unlikely that the 1% you got is typical of the 10% you got Nielson tries to show how much they care about Minorities (concerned and understand—committed to having adequate representation)- Everyone counts- 54 years of business history - Employees in 49 states measuring television When they collect the data, the basic unit of analysis: households not people- Households are easier to count than people (don’t move around as much)—have groups of