The Business of Media
What's In it For You
PR and Advertising Agencies
Your money is the fuel that runs the world of media. This money comes from your customers when they buy your products. Media companies have aggregated audiences by attracting them to programming and content that they have invested in. Paid subscriptions are another business model for media companies e.g. Netflix, pay cable. Cable TV is a hybrid providing both pay and advertiser models.
Flat fee or Commission
The relationships with the media publishers are coordinated on behalf of the marketer by the agency for a flat fee or a commission percentage of the media placement. The commission percentage can vary.
Why are there Agencies?
Public relations and advertising agencies are made up of specialized professionals in the areas of marketing research, brand management, creative services including copy-writing production and graphic arts, and media planning and buying. Strategically there is a benefit to having all of these services under one roof : consistency and speed of execution. Practically it is a massive undertaking to manage, budget, supervise and account for all of the placements and reporting that this brings about. Sometimes as many people as it takes on the agency side to do things, there is almost the same number of people on the client side that they have to report to.
How do they Work ?
In a word this can be expensive. However, that said national brand campaigns that account for billions of dollars have to pay the piper for having that much market share and holding off the competition. How do they do it, these agencies and large brands? The main thing to realize is that agencies win and lose business in cycles, people change jobs, personalities clash, budgets and shareholder value go up and down. In those changes the work has to continue and in the final analysis it is being outsourced to smaller companies (that wind up being bought), producers , creatives, writers and management is hired away from other agencies and companies. Agency people go to media companies, agency people go to publishers, and brand people go to agencies. It all wraps up with bunch of people working for the same things : brand awareness and market share. The bench marks are ratings, impressions, clicks, conversions. acquisition and money.
The best reason for using an agency is their access to research and data. It all starts with research. Proprietary or syndicated it is a big data world. The company with the best data and the ability to use it wins. Geography, audiences, avatars, interests, profiles, behaviors all cross tabbed and referenced to focus the budgets on the people that are buying brands and products and the platforms that they use and the programming and content they view.
Business Objectives and Strategies
Goals are established based on the marketing intelligence gathered about the competition and the consumer. This is expressed in a percentage of market share at the brand level that the marketer desires to capture. It can also be expressed as units sold, subscribers, clients acquired. Strategies are developed and coordinated for marketing, public relations and advertising based on consumer consumption of category and brand based on geography, seasonality, and demographic data.
Media Objectives and Strategies
Goals are established specifically based on the media usage of the consumer and their behavior. Data is collected and coordinated to design the audiences that are most likely to buy the product. We use that data to know what will be purchased, when it will be purchased and the steps take before the purchase is made.
The Media Plan and Execution
From all of this data planning cost data are developed for all of the possible media that is necessary to reach as much of the audience as possible based on the communication goals established in the media ob and strats. The planning costs are brought together and modeled for the optimal media mix of reach and cost. This is how the budget is developed. Depending on the agency and their relationships and leverage in the marketplace the data that is input for the cost can vary. However, all media is bought on a negotiated basis based on the leverage. When the creative is ready or when the media market moves the agency jumps and makes bids for placement of the advertising. Depending on the media this can happen very fast or it can be drawn out over time.
A Word to the Marketer and Advertiser
Some information was broad stroked in an effort to be clear and concise. The main takeaways are these : there is a cost associated with business growth. That cost is in time, money and effort. The best marketing and advertising campaigns are created and managed by teams of people all pulling for the same goal. That goal should be in alignment with your goals. The clarity and supervision of accountability for reaching that goal is essential.
The final word is that your message, brand and reputation are up to you. If there is something being said on a news show, a TV network or publisher that is not in alignment with your goals you have the right to move your advertising to places that are better suited for you. Keep tabs on what is going on in the media marketplace. Your consumers seeing your message in news and programs associate your brand with what they see.