MEDIABUYINGANDPLANNINGWORKSHEET：媒介购买和计划工作表.docx

MEDIA BUYING AND PLANNING WORKSHEET ANSWER KEYADVERTISING & PUBLIC RELATIONS1. Calculate the Average Frequency of exposure given the Frequency Distribution below.% of AudienceExposureExposed Frequency10%240%450%3100%(10%) x (2) + (40%) x (4) + (50%) x (3) = 3.3 times2. A manager is deciding whether to air an ad during Program A or B. The following data are available:ProgramCost to Air AdAd Production CostRatingProgram A$100,000$20,00010Program B$50,000$20,0005 a. Calculate Cost Per Point (CPP) for each program option. Which option is better based on CPP?A: CPP = $100,000 / 10 = $10,000 per pointB: CPP = $50,000 / 5 = $10,000 per pointCPPs are equivalent, so break the tie by including Ad Production CostA: CPP = ($100,000 + $20,000) / 10 = $12,000 per pointB: CPP = ($50,000 + $20,000) / 5 = $14,000 per pointNow Program A seems like the better option since its CPP is lower.b. Calculate Cost Per Thousand (CPM) for each program option. Which option is better based on CPM?A: CPM = $100,000 / (10 x 1MM) x 1,000 = $10 per MB: CPP = $50,000 / (5 x 1MM) x 1,000 = $10 per MCPMs are equivalent, so break the tie by including Ad Production CostA: CPP = ($100,000 + $20,000) / (10 x 1 MM) x 1,000 = $12 per MB: CPP = ($50,000 + $20,000) / (5 x 1MM) x 1,000 = $14 per MNow Program A seems like the better option since its CPM is lower. Note: CPP and CPM always give the same answer!3. A manager is deciding whether to air an ad during Program A or B. The following data are available:TotalProgramPlannedGross RatingCost to Air AdsAd Production CostRatingFrequencyPoints (GRPs)Program A$800,000$100,000108 10 x 8 = 80 GRPSProgram B$500,000$100,00056 5 x 6 = 30 GRPSa. Fill in the rightmost column “Gross Rating Points” (GRPs).See aboveb. Calculate Cost Per Point (CPP) for programs A and B. Which option is better based on CPP?*Note: I am not including production costs since they are the same across both options, but you could include them if desired.A: CPP = $800,000 / 80 = $10,000 per pt.B: CPP = $500,000 / 30 = $16,667 per pt.Program A is better because it has a lower CPP.c. Calculate Cost Per Thousand (CPM) for programs A and B. Which option is better based on CPM?*Note: I am not including production costs since they are the same across both options, but you could include them if desired.A: CPM = $800,000 / (80 x 1MM) x 1,000 = $10 per MB: CPM = $500,000 / (30 x 1MM) x 1,000 = $16.67 per MProgram A is better because it has a lower CPM.*Note once again: CPP and CPM always give the same answer!4. A brand manager is considering placing a print ad in one of two print publications: A or B. The data concerning her choice of placements is as follows:Publication A: Has a controlled, mostly paid, circulation of approximately 5 million subscribers, of which 40% constitute the target demographic desired. The pass-along rate among the target demographic is estimated to be about two times (2x) that is, an average of three people are expected to read one purchased magazine including the original subscriber. The cost to design and produce the ad for this particular publication is approximately $20,000 and the cost of a one-time insertion is $280,000.Publication B: Has an uncontrolled, all non-paid circulation of approximately 2 million people with a typical return rate of about 30% (i.e. 30% of the printed publications never get read by anyone). Estimates show the desired target demographic constitutes about 50% of the net circulation (i.e. circulation after returns). The Publisher does not have data on pass-along rates, so you conservatively assume zero pass-along. The cost to design and produce the ad for this particular publication is approximately $7,000 and the cost of a one-time insertion is $17,500.a. Calculate the Cost Per Thousand (CPM) for advertising in Publication A. CPM = ($280,000 + $20,000)/(5,000,000 x 40% x 3) x 1,000 = $50 per Mb. Calculate the Cost Per Thousand (CPM) for advertising in Publication B. CPM = ($17,500 + $7,000)/(2,000,000 x 70% x 50%) x 1,000 = $35 per Mc. Based on CPM alone, which is the more cost-effective advertising vehicle, Publication A or B? B, because it has the lower CPM.d. Sometimes brand managers and ad agencies choose the option with the higher CPM. Describe one other (non cost-effectiveness) decision criterion that might lead to the choice of a placement with a higher CPM? There could be several reasons. The higher CPM option could have:- A more narrowly targeted audience- Less waste (“ego”) coverage- A better impact as far as production values / recall / etc. goes- A better ROI because the segmentation and targeting is superior5. A brand manager, along with the help of her ad agency, is trying to decide whether to air a commercial during Program A or Program B. The following data are available:Program A: Has a rating of 10. A 5x frequency schedule can be purchased for $500,000, including ad design and production.Program B: Has a rating of 7. A 10x frequency schedule can be purchased for $600,000, including ad design and production.a. How many Gross Rating Points (GRPs) are being purchased with Program A? 10 x 5 = 50 GRPsb. How many Gross Rating Points (GRPs) are being purchased with Program B? 7 x 10 = 70 GRPsc. How many households will be exposed to Program A? (give a number in millions of households) 10% x 110.2 MM = 11.02 MM Householdsd. Briefly explain why the number you found above might be differentthan the number of households who actually see the ad during Program A. Zipping / Zapping / Non-attention / Do something else besides watch tve. Calculate Cost Per Point (CPP) for Program A. CPP = $500,000 / 50 GRPs = $10,000 per pt.f. Calculate Cost Per Point (CPP) for Program B. CPP = $600,000 / 70 GRPs = $8,571 per pt.g. Which program is more cost-effective based on Cost Per Point (CPP) alone? B, because it has a lower CPP.h. Without calculating, would your answer to (above) change if re-calculated using Cost Per Thousand (CPM)? Why or why not? No CPM and CPP always give the same result.i. Suppose a brand manager at XYZ company runs a television ad campaign whose objective is to create initial brand awareness for its newly-launched brand among 30% of the target market with the eventual goal of converting 25% of aware households into annual customers each worth a total annual average contribution margin of $100 per household (disregard the contribution from trial sales which is expected to be negligible anyway). The total target market size for the brand and its relevant competitors is estimated to be approximately 25% of the total number of U.S. households. What is the highest dollar amount that can be spent on the television advertising if XYZ company is to meet its Return on Investment (ROI) goal of 40%?ROI = (Incremental Contribution Advertising Cost)/ Advertising Cost .40 = 110.2 MM x 25% x 30% x 25% x $100 Advertising Cost / Advertising CostAfter a little algebraAdvertising Cost (maximum to spend) = $147,589,286126. A manager is deciding between a tv commercial, radio commercial and a print ad. The following data are available:TargetTotal Exposure/EffectiveEffectiveTotalProgramCoverage/PlannedGross RatingExposureExposure/Cost to Place AdsAd Production CostRatingCirculationFrequencyPoints (GRPs)PercentageGRPsTV Commercial$1,000,000$200,00010-20200 GRPs70% 140 ERPsRadio Commercial$150,000$10,000-6 MM848 MM80% 38.4 MMPrint Ad$400,000$100,000-10 MM550 MM90% 45 MMa. Fill in the column labeled “Total Exposure/GRPs”.TV: GRPs = 10 x 20 = 200 GRPsRadio:Total Exposure = 6 MM x 8 = 48 MMPrint:Total Exposure = 10 MM x 5 = 50 MMb. Fill in the column labeled “Effective Exposure/GRPs”.TV: 200 GRPs x 70% = 140 ERPsRadio:48 MM x 80% = 38.4 MMPrint:50 MM x 90% = 45 MMc. Calculate Cost Per Thousand (CPM) for each of the three media options. Which option is best based on CPM?TV: CPM = (1,000,000 + 200,000)/(140 x 1MM) x 1,000 = $8.57 per MRadio:CPM = (150,000 + 10,000)/(38.4 MM) x 1,000 = $4.17 per MPrint Ad:CPM = (400,000 + 100,000)/(45 MM) x 1,000 = $11.11 per MRadio is best because it has the lowest CPM of all three alternatives.d. Why must CPM be used to compare the three options in this case?Because there is no such thing as “ratings” for print (and, for the most part, radio), therefore CPP would not work. CPM is the only metric that can be used to compare alternatives across different media.e. What other aspects besides CPM should the brand manager consider when deciding whether to do a tv, radio or print ad?- Which medium will best showcase the campaign (i.e. have maximum impact / engagement since “media is the message”)?- Absolute dollar cost- Media availability (right time and place)- Fit with ad agency skills and advertising competencies- ROI considerations7. A brand manager is deciding whether to advertise during Program A or Program B and is given the following data:ProgramAd Production CostCost to Air 30-second spot 1xProgram RatingPlanned FrequencyAd Campaign Exposure TimeSales Time PeriodA$500,000$250,00010.0203 weeks5 weeksB$500,000$340,00012.5162 weeks5 weeksa. Calculate T-CPP for running the campaign during Program A.T-CPP = (CPP/Exposure Time)/Sales TimeT-CPP = ($500,000 + $250,000 x 20)/10) / 3 weeks) / 5 weeks = $916,667 per pt. b. Calculate T-CPP for running the campaign during Program B.T-CPP = (CPP/Exposure Time)/Sales TimeT-CPP = ($500,000 + $340,000 x 16)/12.5) / 2 weeks) / 5 weeks = $1,188,000 per pt. c. Which program yields the more cost-effective ad campaign?Program A, since it has the lower CPP.8. Weighted Impression Method of Calculating CPMSuppose we intend to air a television commercial with the following exposure characteristics:Frequency of ExposureQuality of Exposure Weight% of Audience Exposed1.225%2.220%3.515%4.610%5.78%6.88%71.07%81.07%Further assume the following:Total cost to advertise is $40 MM.Total Audience Size (at maximum exposure) is 10 MM households. Calculate a “Weighted Impression” CPM.Frequency of ExposureQuality of Exposure Weight% of Audience ExposedImpressionsWeighted Impressions10.225%2,500,000 = 10 MM x 25% x 1500,000 = 2,500,000 x .220.220%4,000,000 = 10 MM x 20% x 2800,000 = 4,000,000 x .230.515%4,500,000 = 10 MM x 15% x 32,250,000 = 4,500,000 x .540.610%4,000,0002,400,00050.78%4,000,0002,800,00060.88%4,800,0003,840,000717%4,900,0004,900,000817%