Media Buying – Marketers vs Accountants
You have probably heard the saying “accountants know the cost of everything and the value of nothing”. So the question then becomes do you view your media investments as an accountant or as a marketer?
How to optimise your media buys
When buying media there are several things you want to balance and optimise against the available budget.
- You want to reach as many as possible in your audience.
- You want to reach them as often as needed for your communication to be effective. Note that the reference is “as much as needed” and not “as much as possible”. Every additional exposure for a person tends to have a lower marginal effect than the previous, so adding more frequency will both be marginally less effective and hence less efficient and increases the risk of annoying the receiver. Advertising fatigue is a real issue, and we should avoid contributing to it by adding excessive repetitions.
- You want to reach them as strongly as possible and maximise the impact. This comes both from the ad format and the quality of the creative execution. Investing in relevant creative ideas and executions has several distinctive advantages:
- Your ads get noticed more, so it increases the impact
- You can save on media, as you can achieve the same reach and impact with a lower media investment
- Your products will be seen as having better quality and performance. Research shows that investing in “advertising capital”, i.e. well-produced ads that people like and which help build the brand, has a positive spill-over effect on how people perceive the brand’s products and services. It is like there is a mental cue saying “if they care this much about the quality of their advertising, they must care a lot about their products and services too.”
- You want to reach them for longer. This is another effect of both media selection, and of impact and good creative ideas and execution. Media channels are consumed in different ways, which also has an effect how long people look at the ads in each channel. In addition, people spend more time on ads they like, and hence your chances of getting more people to like you and want to buy from you increases with higher attention rates.
- You want to achieve more and better results than the competition. Everything we have said so far must also be compared to your peers. What is your relative share of success in each of these areas?
Metrics to consider when negotiating media buys
So when we look at the cost of media, we must look at it in several different ways. The first question to think about is to consider at what stage of the media delivery process do I want to focus my value-for-money equation? Here are some examples that show how the “cost-per-X” differs:
- Cost per impression. This is what it costs to send ads to the receiver’s device, irrespective of if they are viewed or even viewable
- Cost per viewable impression. This is what it costs to have your ad visible on the receiver’s screen, but does not say anything about if it has actually been seen.
- Cost per viewed impression/Cost per attention. This is what it costs for someone to look at your ad. But it does not say for how long or how much.
- Cost per attention second. This is what it costs for someone to look at your ad for a second.
- Cost per unit of effect metric. This is what it costs for you to achieve one unit of the desired effect, which could be cost per activity (such as a visit to your web site or a download), cost per order, or cost per customer.
Clearly each of the metrics above is a subset of the previous metric. Hence, with the same budget to allocate irrespective of where you are in the “cost per X” ladder, the “cost per X” increases for each stage. But at the same time the risk and uncertainty go down. The more you know about the value your media delivers in terms of attention levels and the length of time spent viewing your ad, the more confident you can be about the effects you create. That knowledge can make you both more effective and more efficient.
The downside is that the price tag per unit of delivery goes up. Often quite significantly. To an untrained eye it might be more tempting to buy something “cheap” – or at least at a low unit cost. But that is the accountant’s view* from the opening sentence. If you are a marketer, you should think differently and look more at the value delivered and how certain you can be of that delivery. Look more at how confident you are in the effects created and the elimination of risk.
To think like a marketer
A smart marketer will look more at the share of attention and the length of attention your ads generate rather than the cheaper cost per impression, and invest wisely against those targets. And above all, look at the effects generated by the attention, be it through actions such as clicks and conversions or more long-term metrics such as brand awareness and brand consideration. The steps in the cost-per-X ladder above can thus be used to evaluate the different steps in a campaign plan:
- The rate of viewable impressions vs delivered impressions is a metric of how well your media money works and how good your media buy is.
- The rate of attention/viewed ads vs viewable impressions is mainly a result of the type of media platform you have chosen.
- The length of attention is influenced by both the media platform and the creative execution. The choice of media platform defines the scope for how much attention you can achieve, whereas the execution defines where in that scale your activity performs.
- The effects generated are metrics of how good your message and creative execution is. Note that the effects are also impacted by the media choices, where the same execution running on different platforms is likely to generate different attention levels and hence different opportunities for creating effects. Hence, when you want to compare your performance with your competitors, be it for attention levels, attention time or effects generated, make sure you focus on like-for-like, i.e. similar formats and platforms.
So don’t act like an accountant and go for the lowest unit cost. Instead, think like a marketer and evaluate your media buys where you get the highest attention, because that is where you get the highest value and can create the biggest effects.
* In fairness, most accountants I have met do understand the difference between cost and value. But why ruin a good story by removing the perceived conflict?
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