Marketing

Management of Electronic
Media
Learning Outcomes

• You will learn the role marketing plays in the

electronic media and the parties responsible for
marketing.
• You will learn basic marketing strategies of
segmentation, positioning, and branding.
• You will learn the different types of advertising and
their importance to the electronic media industries.
• You will learn terminology used in evaluating media
advertising.
• You will learn how promotion is used in marketing
and the different types of promotion found in the
electronic media.
Marketing
• Electronic media companies are constantly engaged in marketing to
different types of audiences, advertisers, agencies, representative
firms, and suppliers.
• Marketing is an essential skill needed by electronic media
managers.
• Marketing can be thought of as the ability of organizations to serve
consumers’ needs and wants for specific products.
• A business that understands the importance of marketing has two
related goals:
• To generate new customers.
• To serve current customers.
Marketing

• For successful marketing to occur, companies

must be internally organized around common
goals and objectives.
• Marketing efforts follow the four P’s of
marketing:
• Product
• Price
• Place
• Promotion
The Four P’s of Marketing
• Product (consists of the actual goods produced for
customers as well as packaging the product).
• Price (impacts the sale of a product and affects
competitors who consider what price to charge in light
of other prices available in the market).
• Place (the physical location at which the product is
actually sold and the steps taken to distribute the
product).
• Promotion (a combination of activities that promote
both awareness among consumers and the actual selling
of products. Advertising is a major part of promotion).
Personnel in Electronic
Media Marketing
• Most marketing tasks are coordinated across two units:
• Sales
• Promotions
• A manager supervises the sales department which serves primarily
to market the station to potential advertising clients at the local,
regional, and national levels.
• A manager supervises a promotions or creative department. The
size of the promotions staff varies with the size of the market.
• Promotional staffs have increased in recent years with the
emergence of the Internet as a marketing tool.
Personnel in Electronic
Media Marketing

• The sales and promotions departments are

interdependent and should work together to
benefit the organization.
• Marketing involves a wide range of managerial
responsibilities:
• Strategic planning
• Targeting of specific audiences
• Design of advertising and promotional campaigns
• Extending the organizational
Personnel in Electronic
Media Marketing

• Marketing is described as a form of

warfare which requires participants to
recognize opponents’ strengths and
weaknesses in order to successfully
exploit or defend against them.
Marketing Strategies

• Successful marketing is a product of

carefully planned strategies.
• There are three common strategies used
by businesses to market their products:
• Segmentation
• Positioning
• Branding
Marketing Strategies
• Segmentation (to identify segments of the market not
currently served and develop products to meet their
needs).
• To be effective, the segment must be measurable, large
enough to be profitable, and reachable.
• Database marketing has refined segmentation
strategies. Database marketing involves building files of
computerized information on audience members, then
accessing the information as different needs warrant.
Marketing Strategies
• Positioning (presenting the product to
consumers in a clear manner).
• Positioning builds on a clear identity (brand) in
the marketplace and establishes differences
from competitors.
• Positioning in the electronic media requires an
objective analysis of many factors such as the
market, the number of competitors and their
marketing strategies, and a thorough internal
analysis of all areas of station or system
operation.
Marketing Strategies
• Branding (differentiates products, goods, and services in the
marketplace).
• In branding, both tangible and intangible values work together to
create an image of a product in the mind of the consumer (soap vs.
Tide or Cheer).
• Brand image is influenced by many factors:
• The product
• Packaging
• Name
• Price
• Advertising and Promotion
• Method of Distribution
• To establish an effective brand image, all these aspects must work
together.
Sales versus Marketing

• Electronic media companies have moved

away from simply selling advertising time
clients. As competition for audiences has
escalated, electronic media firms have
recognized the need to emphasize
marketing in order to attract advertising
dollars. It is helpful to learn the
difference between sales and marketing.
Sales versus Marketing
• Expanding Selling to Marketing (to maintain a
competitive position, broadcasters had to adjust to the
intensified competition and shift from a sales-oriented to
a marketing-oriented philosophy.
• Advertising bureaus were created to help local stations:
• Radio Advertising Bureau (RAB)
• Television Bureau of Advertising (TVB)
• Cable Advertising Bureau (CAB)
• Internet Advertising Bureau (IAB)
• Media managers keep abreast of the latest marketing
techniques through seminars, conferences, and
educational opportunities.
Sales versus Marketing
• Understanding Clients and Their Needs (the
genuine recognition and goal of serving the client’s
needs).
• A sales-oriented approach focuses on the product
(advertising time). A marketing-oriented approach is
designed to help clients meet the goals and objectives
of their business.
• To recognize the needs of clients, the consultancy
interview is used to draw out information about the
client’s business and the information is then used to
formulate a marketing plan.
Sales Management: GSM,
Local, and National Sales
• The Role of the General Sales Manager (GSM) is to
oversee all operations of the sales department.
• The GSM’s primary responsibilities include the
development of sales policies and objectives.
• The GSM also:
• Coordinates sales with other departments
• Maintains budgets
• Supervises personnel
• Works with advertising clients at all levels
• Approves copy and contracts
• Works with the business department (collections, credit, etc)
Sales Management: GSM,
Local, and National Sales

• Local advertising is an important part of

total revenues for electronic media.
• Radio (78% of total revenues)
• TV (33% of total revenues)
• Cable (22% of total revenues)
Sales Management: GSM,
Local, and National Sales
• The local sales staff is responsible for generating new
business. The salespeople are referred to as account
executives (AE).
• The size of the local sales staff varies according to
market size.
• AEs draw higher salaries because they receive
commissions (percentage of the ad sales).
• AEs also:
• Prepare and present sales presentations.
• Provide service to existing clients.
• Assist in preparing advertising copy.
Sales Management: GSM,
Local, and National Sales
• Selling advertising is a challenging profession because
there is a lot of rejection.
• The role of the local sales manager (LSM) is to oversee
the local sales staff. LSM usually draw high salaries
because of overrides (a commission on total sales
achieved above monthly or quarterly goals).
• The LSM also:
• Administers all local sales activities
• Supervises local AEs
• Establishes individual projections and quotas
• Evaluates unit performance
Sales Management: GSM,
Local, and National Sales

• The amount of advertising is limited to the

amount of time available to broadcast the ads.
• In radio, the amount of time available for
advertising is referred to as inventory.
• In TV and cable, the term availabilities (or
avails) is used to refer to the amount of time
available for advertising.
Sales Management: GSM,
Local, and National Sales

• Radio and TV Revenue Projections

and Rates are determined by the
demand of the advertisers.
• Rates for individual spots are almost
always negotiable in markets of all sizes,
supply and demand of inventory have the
greatest impact on advertising rates.
Sales Management: GSM,
Local, and National Sales
• Regarding inventory in TV, several factors make
it much more variable:
• The number of available spots varies according to the
daypart (the more viewers/the more the cost of the
ad).
• TV spots are usually tied to ratings performance
(stations guarantee that a certain estimated part of
the audience will see the program). If not, the
station must provide a makegood (free ads).
• The reliance on barter that was determined when the
program was acquired. Barter limits the available
inventory.
Sales Management: GSM,
Local, and National Sales
• Inventory is more limited in cable TV.
• Local cable advertising is confined to 1 -3 minutes per
hour.
• Cable systems follow one of three options regarding
advertising:
• Employ a local marketing staff.
• Outsource advertising sales to a company that specializes in
marketing insertion advertising to local businesses.
• Use interconnects to increase advertiser effectiveness by
offering the efficiency of a multiple-system purchase and save
time by using only one contract.
Sales Management: GSM,
Local, and National Sales
• National advertising is another important source
of revenue.
• There are two categories of national advertising:
• Spot advertising (represents the local time that is
sold to clients at the national level. This is referred
to as a national spot).
• Network advertising (represents the advertising
dollars sold by the network. These advertisements
are presented during network programming).
Sales Management: GSM,
Local, and National Sales

• National and regional sales are

coordinated with a National
Representative Firm. This firm acts as
an extension of the local sales forces.
• Firms usually represent only one station in
a market.
Sales Management: GSM,
Local, and National Sales

• Cooperative or co-op advertising is another

category of advertising revenue available for
electronic media.
• In co-op advertising, manufacturers share in the
advertising costs with local retailers.
• The money available for co-op depends on an
amount of accruals (dollars credited for
advertising for each retailer).
Sales Terminology
• Common terms used in marketing media advertising
include:
• Gross Impressions (a measure of the total media weight and
refers to the total number of people reached by each
commercial in a campaign).
• Gross Rating Points (the sum of all rating points generated in
an advertiser’s schedule).
• Reach (a measure of how many different people are exposed
to at least one commercial advertisement).
• Frequency (used in a combination with reach, refers to the
number of times the average person or household is exposed to
the same advertisement).
Sales Terminology

• Cost per thousand (the cost to reach 1,000

people).
• Cost per point (the cost of a single rating
point).
• Computer software is used to generate
the types of cost and audience analysis
estimates. It is not important to know
how to calculate these numbers.
Promotions as a Form of
Marketing
• Generating an audience is the primary function
of the promotions department.
• For the total marketing effort to succeed,
companies need good promotional campaigns
and strategies.
• The size and budget devoted to the promotions
department varies according to market size and
revenues.
• On average, stations allocate 3-5% of revenues
back to promotions budgets.
Promotions as a Form of
Marketing
• The duties of the Promotion Manager is to
supervise the activities of the promotions
department.
• The Promotions Manager:
• Manages personnel
• Supervises the budget
• Allocates resources
• Supervises graphics
• Evaluates research data
• Coordinates the Web site
• Handles public promotional events
Promotions as a Form of
Marketing
• Promotions Managers use many types of
activities to market an electronic media facility:
• On-air promotion (station promos)
• Web site
• Publicity (contests/stunts)
• Advertising (billboards)
• Sales promotions (seminars to potential advertisers)
• Community involvement (involvement with civic
groups/non-profit organizations)
Evaluating Marketing
Efforts

• Media managers constantly execute and

evaluate marketing strategies and
campaigns.
• The goal of generating advertisers and
audiences remains a significant challenge
for electronic media managers in the 21 st
century.
Marketing

• QUESTIONS ?