Here's the Most Self-Destructive Thing Many Advertisers Do

quotIn the pitchquot Ted asserted quotwe agreed that targeting actual known heavy purchasers of QSR based on card data would raise ROI 28quotMack grudgingly nodded now at least knowing what was coming nextamp160amp160quotSo why are these indices so close to 100quot he askedTed took the remote and clicked back a few slides showing the rotations that were planned their CPMs GRPsamp160and indices of QSR purchase which indeed were all just above 100quotNotice we avoided any dayparts on any networks where the index was below 100quot Mack saidamp160 quotBut in order to minimize the CPM and maximize the reach we could not buy fixed positions in programsamp160 That would have driven up the CPMs and reduced the reachquotquotHmmphquot Ted mumbled unsatisfied amp160quotIn the pitch I got the impression that we were considering only fixed program buys because of the context resonance factor which we agreed would raise ROI 36quotMack took back the clicker and went to another slideamp160 quotLook we took resonance into account as well just as we promisedamp160 Look at all these dayparts we bought on all these networksamp160 They all average above 20 resonance with your new ads and the industry norm is 19quotquotYesquot Ted shot back quotbut the industry studies show that double digit sales lifts are at higher resonance levels like 30 or moreamp160 I39ve seen resonance data and some ads and programs are 100 resonantquotquotNot for rotationsquot Mack said sympathizingamp160 quotWe save you millions of dollars buying rotationsquotquotBut you may be costing me hundreds of millions of dollars on the salesquot Ted growledamp160 quotPlease go back to the drawing board and bring me a new plan focused not on cheap impressions but on profitable salesquotquotI can39tquot Mack said lookingamp160sadquotWhat do you mean you can39tquot Ted askedquotIn our contract the agency will have to pay you back out of our own pockets if we fall short in our sexage GRP guarantees or in our sexage reach guaranteequot Mack quietly repliedamp160 quotThe kind of plan you now specify will cause us to have to pay you for shortfalls in sexage in order to get you the engaged purchaser impressions and reach you now are asking foramp160 We39ll have to change the guarantees before we can bring you a plan like thatquotTed looked flummoxedamp160 He didn39t want to have to explain this to investorsamp160 Better to not make an issue of it and hope for the bestamp160 One of his investors was a wellknown industry personality who had supplied Ted with the standard clientmedia agency contract formamp160 Ted was lucky the chain had caught onamp160 Best not to try to buck the industry standard way of doing thingsamp160 He knew it had been this way for a long timeThe foregoing allegory reflects a realamp160situation especially in US television todayamp160 All practitioners know how to increase the sales and branding effects of TV ad spendamp160 It involves programlevel buying and branded integration fast reach commercial weeding and many other tactics proven and replicated many times by many practitionersamp160 Yet many of the same practitioners are still doing mostly rotation buying because the contracts make that outcome inevitableamp160 The advertiser signs these contracts and by doing so signs away the right to make the smartest possible buy that will have the most positive short and longterm business resultsamp160 The bulk of the industry is painted into this cornerIt39s easy to changeamp160 The next renewal or start of a media agency contract incent the agency to deliver what you really want not what inertia from 1960s contracts says to doamp160 In the next post I39ll reveal what such contracts might look likeClick the social buttons above or below to share this story with your friends and colleaguesThe opinions and points of view expressed in this content are exclusively the views of the author andor subjects and do not necessarily represent the views of MediaVillagecomMyersBizNet Inc management or associated writers

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Here's the Most Self-Destructive Thing Many Advertisers Do

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Bill Harvey

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