PPM – how to measure radio effectively
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Transcript of PPM – how to measure radio effectively
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PPM – how to measure radio effectively
SEMPL 2008
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Today’s agenda
• Some financial facts• From Average Quarter Hour to minute-by-minute Ratings• Changing the Price of Radio Advertising• Managing the Inventory• Future possibilities
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Ad Spending
Newspapers36 %
Radio3 %
Cinema7 %
Internet9 %
Outdoor3 %
TV16 %
Catalogue3 % Magazines
3 %
Trade Magazines3 %
Insert Newspapers3 %
Free Newspapers1 %
Direct Marketing13 %
Share of Market Q2 2008
Source: IRM
”Radio had the largest growth
(23,9%) Year-On-Year”
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In 2005 the CPT on radio was 52 NOK.In 2008 it is 108! TV is 200
2006 - 261 million NOK through media agencies2008 - 360 million NOK!
P4 breaks advertising-records
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Mediegruppe
Denne måned i år
Samme måned i fjor
Økning/ Nedgang
Hittil i år Hittil ifjor Økning/ Nedgang
Medie- gruppens andel iår
Medie- gr. andel ifjor
Dagspresse 226 747 203 594 +11,4 % 1 743 887 1 713 796 +1,8 % 30,2 % 32,2 %
Ukepresse/magasiner 41 743 38 368 +8,8 % 282 410 289 631 -2,5 % 4,9 % 5,4 %
Fagpresse 11 133 9 036 +23,2 % 77 341 70 682 +9,4 % 1,3 % 1,3 %
TV 244 201 245 474 -0,5 % 1 766 495 1 695 324 +4,2 % 30,5 % 31,9 %
Radio 29 488 23 459 +25,7 % 266 597 218 299 +22,1 % 4,6 % 4,1 %
Internett 104 381 79 148 +31,9 % 709 804 558 878 +27,0 % 12,3 % 10,5 %
Kino 8 981 7 442 +20,7 % 53 279 52 720 +1,1 % 0,9 % 1,0 %
Utendørs/trafikkreklame 46 427 26 539 +74,9 % 282 518 216 881 +30,3 % 4,9 % 4,1 %
Direktereklame 41 391 42 191 -1,9 % 543 564 409 551 +32,7 % 9,4 % 7,7 %
Andre medier 15 181 20 930 -27,5 % 57 631 96 467 -40,3 % 1,0 % 1,8 %
TOTAL MEDIEOMSETNING 769 673 696 181 10,6 % 5 783 526 5 322 229 8,7 % 100,0 % 100,0 %
Radio is taking larger share from the advertisers
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Radio is still optimistic for the future
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Issues
• Editing rules
• Panel size– Small stations require larger panel– More detailed breakdowns require larger panel– Panelists must comply
• Software and reporting
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Advantages with PPM
• Daily updated audience measurement
• More accurate method -> more confidence in radio
• Very similar method to TV (in Norway at least)
...but it is expensive...
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National Radio
P155,6
P422,6
Radio 12,2
P23,7
P35,5
P4 Pluss0,8
Radio Norge
9,6
Commercial Radio
A Brief Overview
Source: TNS Gallup, National PPM Radio Survey
Market Share: Q3 2008 Market Share: Q3 2008
Radio 16,1
Radio Norge27,3
P464,2
P4 Pluss2,3
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Average weekday 2007AQH PPM vs. AQH CATI
0
1
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3
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5
6
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06:00 23:59
AQH PPM
AQH CATI
Higher Reach With Same Definition:
10:00 14:00 18:00
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Average weekday 2007AQH PPM vs. AQH CATI
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06:00 23:59
AQH PPM
GRP PPM
AQH CATI
Big Difference: 15 min. cume to 1 min. net:
10:00 14:00 18:00
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How did we set the price of 1 GRP?
• Put 1 spot in every hour, every day, for a week = 162 spots
• Value with spot pricing: 1 200 000 NOK• PPM 1 min. definition 315 GRP*
• Result: CPT increased by 32%
1 200 000 NOK315 GRP = 3810 Cost Per Point
* Used April/May 2006 average
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Challenges:• Estimating future ratings• Predicting inventory and sold-out ratio• Over- and Under-delivery• Most of the salesforce had little knowledge of the new rating currency
• Tighter control• Increase Traffic function• Handling a decline in ratings (shortage of inventory)• Changing the placement of a block
Solutions:
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Detailed reports of a campaigns performance:
Simple overview
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Planning & Split Analysis (3+)
Scenarios:1. 100% P42. 80% P4, 10% K24, 10% SBS3. 60% P4, 10% K24, 30% SBS
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Single-Source Planning
0
10
20
30
40
50
60
1 2 3 4 5 6+
100% TV
Radio 50%, TV 50%
Radio 100%
Source: PPM Radio & TV test-data, TNS Gallup
Reach (%)
Frequency
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To sum up...
• Radio has had an amazing growth in advertising turnover after the introduction of PPM as the currency
• Radio advertisement has become more precise– You can report and you radiodata in your trackingstudies
• Better utilization of inventory (resources)
• Reach goes slightly up, frequency down
• Single-Source Radio/TV-planning is next!