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TV Foundations > 3. Buying/Trading > Flashcards

3. Buying/Trading Flashcards

1
Q

The Buying Process for Agency (9 steps)

A
  1. MBA Media Buying Authorisation/Buying Brief
  2. Develop pre-buy, including sourcing important information such as market conditions
  3. Set up schedule in buying software, e.g. SMD
    3a. Buy on screen (and send buy to the networks)
    3b. Brief networks for a proposal
  4. Evaluate the buy against campaign goals, replace NAs and finalise buy with network
  5. Final check that holdings matches buy
  6. Track, make adjustments and optimise buy as required
  7. Post Analysis and track
  8. Makegoods
  9. Final post campaign reports for the client
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2
Q

The process for the seller (Networks/TV Broadcasters) - 9 steps

A
  1. Agency to send spot booking to the sales team
  2. Sales to manually book
  3. NAs (unavailable spots) will update in Holdings
  4. Network and agency to negotiate NA replacements
  5. Network to book and confirm activity
  6. Sales to manage changes are requested by the agency
  7. Traffic to manage placement and material
  8. Networks to confirm additional added value
  9. Makegood airtime for spots that have not gone to air, not gone to air as booked or if TARP/Audience delivery is less than planned.
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3
Q

Timeline

A
  • 13 weeks prior: Campaign approval and booking
  • 12 weeks prior: NA replacements
  • 9 weeks prior: Buy summary to client
  • 2 weeks prior: Final Buy to client
  • 1 week prior: Spot list to client
  • Weekly: Campaign tracking/optimisation
  • 4 weeks post campaign: Post Report
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4
Q

4 Different Buying Methods

A
  1. On screen (fixed placement)
  2. Brief to Network (fixed placement)
  3. Dynamic & Automated (non-fixed placement)
  4. Addressable
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5
Q
  1. Brief the Network
A
  • Includes Target Audience, weekly required TARPs (R&F goals), weeks on air and budget
  • The network responds with a prop
  • The buyer needs to check for Quality and CPMs (cost efficiency) and that they are happy with the survey weeks the TV Network is using
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6
Q
  1. Dynamic & Automated
A

Aka Advanced Advertising and is sold on a CPM and impression basis

  • Audience or impressions are guaranteed
  • Done by frequent optimising across day-parts rather than programming
  • Executed using software automation
  • The buyer briefs the networks on budget, CPM, impressions and any exclusions
  • The buyer has no control on specific spot placements
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7
Q
  1. Addressable
A

Only on BVOD
- Can be bought on a segment rather than demographic

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8
Q

When to brief the networks

A
  1. Short lead time (under 4 weeks)
  2. Availability pressures in market
  3. Program specific requirements
  4. CPM deliverables
  5. Sponsorships - can ask if competitors are sponsoring any programs you’re considering as well
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9
Q

When to buy on screen

A
  1. Soft market conditions
  2. Long leads times (13 weeks or more)
  3. Client specific parameters (e.g. program/genre inclusions or exclusions)
  4. Program quality
  5. MORE CONTROL
  6. Combination of commercial lengths being placed to tell a story
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10
Q

Pros of Briefing the Networks

A
  • Networks may be able to find available inventory
  • It is quicker than buying off-screen
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11
Q

Cons of Briefing the Networks

A
  • Delay in Network responses
  • Program selection may not be what the buyer wants
  • May not meet r&f requirements
  • Lack of control and overall visibility
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12
Q

Pros of Buying on Screen

A
  • The buyer selects the programs
  • The buyer manages r&f across all networks
  • The buyer can review the reach build
  • It is quicker, as you are not waiting for props
  • Ensures accurate TARP estimates
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13
Q

Cons of Buying off-screen

A
  • Time consuming
  • Network custom surveys (may not match your selection)
  • Airtime not available
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14
Q

Pros of dynamic and automated buying

A
  • Guaranteed audience delivery
  • Guaranteed CPM
  • Easy to manage pre-campaign
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15
Q

Cons of dynamic and automated buying

A
  • No visibility of programming
  • Not able to provide a spot list to client
  • Can be a little difficult to incorporate into an on-screen buy
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16
Q

How to buy addressable

A
  • Direct IO buy with the TV networks
  • Programmatic buy via a trading desk.
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17
Q

Approved combinations to run r&f

A
  • Metro + Subscription
  • Regional + Subscription (Agg markets)
  • National Subscription
  • Regional Combined panel (sub-market level)
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18
Q

Metro Market Potentials

A

17,695,740, i.e., 67% of population.

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19
Q

Aggregated Market Potentials

A

Aggregated markets total 7,917,520, i.e., 30% of population.

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20
Q

Solus markets potentials

A

Other markets (Solus markets) total 917,000 i.e., 3% of population.

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21
Q

TV Market audience potentials

A

Melbourne (5.3M)
Mildura (65k)

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22
Q

SAS representation

A

Seven Affiliate Sales sell the Seven Network owned programming on the Prime Television Network and
Seven Queensland in all markets excluding Tasmania, where Southern Cross broadcast the Seven Network
programming.

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23
Q

WIN representation

A

WIN represents Nine Network programming in Southern NSW, Victoria and Queensland. In Northern
NSW, Western Australia and Tasmania it represents both Nine and Ten programming.

24
Q

SCA representation

A

Southern Cross Media represents Ten in Southern NSW, Victoria and Queensland, as well as Seven in
Tasmania (as mentioned above)

25
Q

SBS representation

A

SBS represents its own channels (SBS, SBS Viceland, SBS Food and SBS World Movies as well as NITV) in
regional markets - however please note that the regional NSW market is sold as a whole, and not split
between Northern and Southern NSW.

26
Q

Main Channel Codes

A

Sydney - N, Melbourne - V

27
Q

Multichannel codes

A

GOSYD

28
Q

Agency Commission

A

A rebate paid by media suppliers in return for media bookings.

Traditionally 10% of media spend is rebated
back to the agency at invoice stage. The media agency will have agreed terms (client/agency contract) that
will outline what % of the commission the agency keeps as their fee for work and the rest is rebated back to
the client (on the invoice it will show as a commission discount on gross media).

Example: If your Gross media spend is $100,000 the agency commission would be $10,000, therefore the
invoice from the media will be $90,000.

29
Q

Gross cost

A

Gross cost is the media cost, which includes 10% agency commission. It does not include GST. Most common
term used in discussions with TV networks.

Example: If your media cost is $100,000 and the agency commission is 10% ($10,000), you would not deduct
agency commission. Gross cost is the full cost media cost, i.e., $100,000.

30
Q

Net Cost

A
  1. Net cost to media, which is media cost excluding commission.

For example:
Gross media cost ($10,000). Discussions with the media is always gross media cost.
Less 10% commission or times by 0.9 ($10,000*0.9 = $9,000). $9,000 is the net media cost.

  1. Net cost to client. The way this is determined varies by client. The service fee can be charged on
    Gross or Net Media Cost. Ensure you always check with your team.

This example is based on Net cost to client. The calculation would be, Net media, plus client fees
(commission rebate or service fee), plus media levy (which is calculated on gross media).

For example:
Gross media cost (e.g., $10,000)
Net media ($10,000 less 10% commission is $9,000)
Plus client fee ($9,000.05 = $450) note 0.05 is an example, and client contracts vary
Plus media levy ($10,0000.0005 = $5.00)
Net Cost to Client is $9,000+$450+$5.00 = $9,455.00

31
Q

Media Levy

A

The Media Levy is used to fund the Industry Self Regulation system, Ad Standards.

Ad Standards is owned by the AANA (Australian Association of National Advertisers), but is independent.

The cheque gets sent to the AANA who administers it to Ad Standards.
It is an opt-out (optional) levy.

The levy is 0.05% of gross media and paid by advertisers.

32
Q

Spot-monitoring fee

A

Fee charged for the third party verification of TV spot appearance for Post Analysis.

This fee is
charged from Third-Party suppliers such as Nielsen to an Agency for the data.

The data received
at an Agency will detail the exact time the spot appeared, the program name and position in
break.

Generally, this fee may be passed onto the client which is known as the Spot Monitoring
Fee.

This will vary by agency and by client contract and may not be passed on at all.

33
Q

GST

A

Goods & Services Tax.

Federal government tax of 10% of the cost of goods or services, including media
bookings (this applies to all companies unless they are exempt).

The TV Networks will include GST on the
Net total, and 10% is added to the agency invoice (to the client) on net spend.

Some clients will require
this to be outlined on the media plan, so they have the full spend picture.

34
Q

Network budget splits

A

The share of budget to be allocated to each network according to negotiated deals.

Example: Network deals were 35% to Seven; 35% to Nine; 30% to Ten. Budget $1m.
Seven network budget = $1m x 0.35 = $350,000
Nine network budget = $1m x 0.35 = $350,000
Ten network budget = $1m x 0.30 = $300,000

35
Q

Tolerance

A

The agreed % of audience delivery of your actualised TARPs v bought.

Example: In general the networks will guarantee to deliver TARPs +/- 10% of your booked TARPs.

This
tolerance level can alter depending on Network, agency deals, so it is very important you are across these
details and discuss them with your sales rep.

This tolerance level is generally agreed with networks to be
based on consolidated 15 min delivered TARPs.

36
Q

Cancellation deadlines

A

Refers to a period of time activity needs to be cancelled by, without penalty to the client.

This period can vary at different times of the year, and can vary based on client or agency deals, so always
make sure you know what it is.
Historically the last quarter can have longer cancellation deadlines.

Standard
deadlines are:
FTA = 4 weeks
STV = 6 weeks

37
Q

Delete & Charge

A

If activity needs to be cancelled within the cancellation deadline, it will need to be “Delete & Charge”, also
known as D&C.

Meaning the spots do not go to-air but the cost of the airtime booked is still invoiced to the
client.

The value of the airtime can be rebooked at no charge at a later stage, but it’s important to
understand that Delete & Charge should always be the last resort for a client, as re-booking the airtime in
programs that you want can be difficult, particularly in a high demand market.

Also if the airtime that is Delete & Charge was originally booked in March and then the client wants to
rebook the value of that airtime in September, they will get less for their money i.e. March is a cheaper rate
card than September.

38
Q

Drop & Charge

A

If activity needs to be cancelled 3 days or less prior to the activity going live, it will need to be “Drop &
Charge”. This means the spots do not go to-air and the cost of the airtime booked is still invoiced to the client
but the value cannot be recouped at a later date. Check with your agency what is their agreed policy with the
networks for Drop & Charge.

39
Q

Main Trading Currency for FTA

A

TARPs

40
Q

Main Trading Currency for STV

A

Audiences 000s

41
Q

TARPs approach to TV Buying

A

A TARP goal means that spots can be bought anywhere, including low demand off Peak areas.

TARPs don’t indicate how many different people you are reaching or how many times.
● For example - a TARP of 10 could mean 1% of the target audience saw an ad 10 times or that 10% of
the target audience saw it once.
● Historically TARPs were the main type of TV goal, however now there are various tools that can assist
to determine the reach of the audience and how many times they’ve seen the ad (frequency).

No one TARP is alike or the same.

42
Q

Reach approach to TV buying

A

Reach – Reach is a more targeted approach to TV Buying.
● More accurate and reflective of the actual delivery of the audience.
● For example - a 1+ Reach of 10% means 10% of the target audience saw an ad at least once.
● Reach also caters to different market viewing habits.

Reach also has different market cost efficiencies, as the same reach in each market can mean very different
TARP goals and hence cost.

When a media plan has a 50% 1+ reach goal in each market of Sydney, Melbourne and Brisbane, you will likely
need to buy different TARP weights in each of those markets to deliver the 50% 1+ reach.

The reason for this
is a combination of different viewing levels and potentials for each market. For example,
50% 1+ Sydney = 200 TARPs
50% 1+ Melbourne = 170 TARPs
50% 1+ Brisbane = 180 TARPs

43
Q

Primary goals of TV campaign

A

Reach & Frequency

44
Q

Secondary goal of TV campaign

A

TARPs

Necessary as they demonstrate how much it will cost to deliver the reach goal against the target audience.

45
Q

What helps build TV Reach?
(Low frequency)

A
  1. Strong Sunday/Monday buy
  2. High rating programs
  3. Tracking unduplicated audience viewing
  4. Road blocking (Select same time slot on each network, audience isn’t watching all at once)
  5. Varied programming
46
Q

What helps build TV Frequency?

A
  1. Double spotting
  2. Strip programming e.g. News on every day of the week
  3. Top and Tail
  4. Similar programming
  5. Adjacent programming e.g. consecutive shows on the same network
47
Q

How to buy to TARPs

A
  • Rank programs in SMD by CPT
  • Look outside the list if you have a program genre to include
48
Q

How to weight TARPs to get estimates across multiple markets

A

TARPs cannot be added up across markets

To get a total TARP estimate across multiple markets, you need to weight TARPs by each market’s % of
the population.

How to calculate this:
* You first need to know the audience potential of each market - to work out what that market
potential represents as a percentage of the total population.

  • Then apply that percentage against the market TARPs, continue for each market and add
    together for the total.
49
Q

Live (Linear) TV

A

Live (Linear) TV
Linear TV is received via an aerial, satellite or cable. i.e., any TV that is not viewed over the

50
Q

Playback TV

A

Playback TV

Linear TV recorded on a Personal Video Recorder (PVR) or other form of time-shifted technology and
watched after the time of Live broadcast.

Also referred to as Time-Shifted TV.

51
Q

BVOD

A

Broadcaster Video on Demand (BVOD)

● TV watched online is BVOD.
● It can be watched either Live (via live streaming) or On Demand and is available via a set top box,
personal computer, mobile device or connected TV.
● BVOD content is professionally produced, broadcast quality and includes TV shows and movies,
archived shows and BVOD exclusive and originals. Sometimes referred to as Catch-up TV.

52
Q

Live Streaming

A

Live Streaming

BVOD watched over the internet at the time it is broadcasted.

53
Q

On Demand

A

On Demand

BVOD watched over the internet at any time other than at the time of original broadcast.

54
Q

VOD

A

Video on Demand (VOD)
A facility offered by online video providers (not just broadcasters) where households or individuals can
access a movie, program or clip that can be watched at any time on any device.

55
Q

AVOD

A

Advertiser-funded Video on Demand (AVOD)
Any type of VOD service that is funded by the inclusion of advertising in between programs, movies or
clips.

This includes both BVOD services and services where the content is more heavily skewed to User-
Generated Content (UGC) such as YouTube.

56
Q

SVOD

A

Subscription Video on Demand (SVOD)

A type of Video On Demand service where a user pays a regular subscription to watch content.

Most SVOD services are non-commercial and don’t contain advertising.

Netflix, Amazon Prime,
Disney+ and Stan are the major players in Australia.

Paramount+, KAYO and Binge are other
examples of SVOD services, with a lesser number of subscribers.

Due the increase in
consumption of SVOD services, it is expected that there will be many more players entering the
market in the coming years.

TV Foundations (8 decks)

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