CMD Resources

Marketing Formulas

Broadcast Media (gross v net)

Radio and TV is generally quoted/placed as Media Gross; however, the advertiser is responsible for the Net cost only

Gross to Net
Net to Gross

Cost Per Point (CPP)

To determine the CPP, take avg. unit cost / rating %
OR Total schedule cost / GRPs

Cost Per Thousand (CPM)

To determine the CPM, take the media cost x 1,000 / impressions
OR Avg. unit cost / rating (000)

Click Through Rate

To determine the CTR, take the number of clicks / impressions

Cost Per Click (CPC)

To determine the CPC, take the cost of the advertising campaign / clicks earned in the campaign

Engagement Rate

To determine cost, take the total engagement / total followers x 100%

Glossary of commonly-requested media-related terms

Streaming Television

CTV

  • Stands for “Connected TV”
  • These are television devices that connect to the Internet. Often the television itself connects, but sometimes there are other devices that connect the TV to the internet, such as TV boxes, sticks, and gaming consoles
  • Gives users the ability to access streaming apps

OTT

  • Stands for “Over-the-Top,” and includes any streaming media service that distributes content over the internet
  • It got its name because the content gets delivered through another platform/medium, usually through a box placed “over the top” of another
    device
  • Bypasses traditional television platforms, such as cable, broadcast, and satellite
  • How does this differ from CTV?
    • While OTT is an online delivery channel for video content, CTV would be the medium
    • OTT refers to the streaming platforms themselves, and CTV is the device that allows users to access these streaming services

Programmatic

  • Programmatic advertising automates the ad buying process by using algorithms and real-time bidding
  • Bidding system software is used to automate the buying, placement, and optimization of media inventory, such as display banners or video
  • You can customize the setup of a programmatic campaign by specifying a target market, budget, and campaign goal

Types of targeting

Demographical

  • Targets market based on demographic information, for example, gender, age, family size, income, etc

Behavioral

  • Uses people’s activities (concertgoer, fitness enthusiast, etc) to determine which ads will resonate most with them

Contextual

  • Refers to the display of relevant ads based on the website’s content, rather than using the data about the visitor, for example, running an ad for children’s clothing on a parenting website

Psychographic

  • Focuses on understanding the consumer’s emotions and values to market more accurately. It looks at understanding the motivations behind why people buy and how they buy, for example, running an ad for pet toys targeting consumers who are passionate about animals

Geographical

  • Geographical targeting varies by media type & vendor; for example, broadcast media is purchased by DMA (designated market area), while other types of media can get more granular, down to city, neighborhood, or even specific longitude and latitude

Dayparts - TV & Radio

Dayparting is the practice of dividing the broadcast day into segments, such as morning, daytime, early fringe, prime time, late news, late fringe, and weekend in Television. In Radio, dayparts are divided into morning drive, midday, afternoon drive, evening, and weekend. Advertisers often align their messaging by daypart, such as promoting a breakfast sandwich in morning drive, and family meals in afternoon drive. Dayparting is also commonly used in digital out of home placements, again, to align messaging with time of day

Spill

The term spill in marketing refers to the additional reach of an advertising campaign beyond the intended target audience and/or designated market area. Spill can also refer to the external effect of one or more campaign tactics on another, or how a competitor’s campaign can impact your brand

GRPs (Gross Rating Points)

  • A metric in traditional ad buying (most commonly TV and radio) that measures the impact of a given ad campaign
  • Quantifies impressions as a percentage of a target audience, multiplied by the frequency in which that audience sees the ad
  • Generally used in these traditional marketing methods where a precise measurement isn’t possible

Makegood

  • Additional accommodations made for an ad due to impressions being lower than expected or when an error occurred in the execution
  • Makegoods are generally additional spots or impressions to make up for the issue

Reach & Frequency

  • Reach: The approximate number of potential customers who view a specific advertising campaign
  • Frequency: The number of times an ad or impression has been served, per unique user

Share & SOV

  • Share: A quantifiable measure of a company’s dominance in terms of sales within the company’s industry or market
  • SOV (Share of Voice): Measures the percentage of brand awareness or percentage of overall media impressions available within a given market that is attributed to a particular brand, company, or product

CTR (Click Thru Rate)

CTR measures the percentage of people who receive an ad and click on it, and can pertain to any clickable digital ad, such as display banners, paid social, email/eblasts, etc. Percentage is against total number of impressions served

Rich Media

A digital advertising term for an ad that has advanced features like video, audio, or other elements that encourage viewers to interact and engage with the content

SEO & SEM

SEO (Search Engine Optimization)

  • The practice of improving your website to increase its visibility within search engines

SEM (Search Engine Marketing)

  • The process of getting website traffic from search engines, either organically or through paid search

ROS, ROP, and ROB

ROS (Run of Site)

  • An advertisement being shown on any page of one particular website
  • Advertisers give up control over the placement of their ads to allow publishers to place ads as they see fit, which typically results in lower CPMs/costs

ROP (Run of Paper)

  • In newspaper advertising, it is an ad that can be placed anywhere in the newspaper, instead of paying for placement within a specific section

ROB (Run of Book)

  • In magazine advertising, it is an ad that can be placed anywhere in the magazine at the magazine’s discretion, vs having a guaranteed position such as “Inside Front Cover”, “First 50% of Publication”, etc.

Geofencing

Geofencing marketing is a type of location-based marketing strategy that enables advertising to potential customers within a specific geographic radius or area, and can be as granular as a specific latitude/longitude

Native Advertising

A type of paid advertising that appears to be in the style and format of the content near the advertisement’s placement. Native ads are meant to blend in with the site’s content and be perceived as more editorial than advertising

Media Types and what they are used for

Programmatic Display Banners

  • An advertisement that is placed in designated areas on websites, apps, and social media. They are bought and sold using algorithms and real-time bidding, to target specific consumers and get advertisers the best price
  • Programmatic display banners are best suited for brand awareness or in conjunction with other media types
  • Ads are placed programmatically, meaning they are set up to target specific consumers and then are served on the websites those consumers go to

Site Direct Display Banners

  • Site direct ads are bought directly from a particular website and give control over where your ads are displayed
  • Site direct display banners are also best suited for brand awareness or in conjunction with other media types
  • This is different than programmatic display banners because you cannot choose your audience based on characteristics; whoever enters the website will see the ad
  • CPMs are also generally higher for site direct banners than for programmatic

Native Ads

  • Native ads are designed to fit into whatever platform or site they’re on, which can encourage users to engage with the content. They are seamlessly integrated into the consumer’s experience
  • Native ads help build trust among their audience because they are non-intrusive
  • Native ads can be used for both branding/awareness and to drive clicks & traffic

Paid Social

Social ads generally have higher engagement and click thru rates than other digital ads.

Facebook

  • Facebook advertising offers strong targeting capabilities, making it easier to hone in on a specific consumer
  • On average, a person spends almost 2.5 hours daily on social media, with Facebook being the most popular social network

Instagram

  • Consumers like to use Instagram because it is less time-consuming than traditional social media methods. The messages delivered are visual, and therefore communicated in a more concise way
  • Instagram has the highest engagement rate of any social media platform
  • Since Facebook and Instagram are connected, you can target your audience based on Facebook data

TikTok

  • Influencers hold power in marketing; consumers build trust with them and find them to be more relatable than any traditional methods of advertisement
  • TikTok has created a platform to connect businesses and influencers through TikTok Creators Marketplace (TCM), so businesses can directly interact with verified influencers to match organic content to their products and services
  • TikTok offers in-feed ads, top view ads, branded hashtag challenges, and branded effects using audience, demographic, behavior, interests, creator, and device as options for targeting
  • One downside of TikTok is that the platform is not as heavily policed as Facebook & Instagram, and users often leave rude or inappropriate comments; it is necessary to monitor TikTok ads regularly

Snapchat

  • You can target your Snapchat ads to a lookalike audience. This means that Snapchat helps you reach people who might be interested in your brand because of their similarity to other Snapchat users who are already interacting with your brand. It is extremely popular among 15-25 year olds, reaching a younger audience than other platforms

Pinterest

  • Pinterest is a combination of a search engine and social media, which makes Pinterest a powerful marketing tool that understands their audience, for example, curating tastes, or seeing trends before they happen
  • Pinterest shows Promoted Pins based on their users’ interests, past activity, and actions on websites as part of retargeting ads

LinkedIn

  • LinkedIn is the world’s largest digital professional network 
  • Content, as well as advertising, is generally focused on a business audience

Streaming Radio

  • Streaming radio has a strong listener base that is continually growing, offering significant benefits and features for advertising. These benefits include access to local, regional, and/or national audiences, targeted ads, and more
  • Streaming radio combines the messaging of traditional radio (usually :15 or :30 spots) with the targeting capabilities of digital media, allowing advertisers to target specific consumers vs. purchasing specific to one station or channel
  • Pandora
    • Pandora offers audio, visual, and video ads that are delivered to relevant audiences
    • They also offer Dynamic Audio Ads, which allow advertisers to hyper-personalize ads with real-time user data. Pandora’s programming will look at things like location, time-of-day, and even the weather to get the right message, to the right user, at the right time. It’s similar to dayparting, but the ads run 24/7
  • Spotify
    • Around ¾ of Spotify users are free subscribers, and the average user spends around 2 hours a day on the app. Users are able to browse other apps while listening to Spotify, and Spotify places ads in between content. Users are unable to skip the ad
    • Using Spotify Ad Studio, advertisers can target audiences by factors like age, gender, location, interests and real-time contexts
  • Programmatic
    • Streaming radio can be purchased programmatically across multiple streaming platforms as well, including Spotify, Pandora, iHeart Radio, TuneIn, SoundCloud, etc

TV (Network and Cable)

  • Market penetration is high; only 2% of U.S. households do not have Television in their home
  • Television has historically been the medium of choice to build quick reach among a targeted audience
  • Broadcast TV is purchased by designated market area (DMA), and Cable is purchased by market or zone, as defined by the provider
  • Broadcast is generally purchased by station or station group, with specific programs (shows) selected for ad placement
  • Cable is generally purchased by network, in broader dayparts such as daytime
  • Television is purchased based on estimated target audience rating points, which vary based on the demographic the advertiser is buying

OTT/CTV

  • OTT/CTV advertising is a more results-oriented approach to TV media buying. Compared to traditional TV commercials, these ads provide more insights, precision, and measurable results
  • They use programmatic methods to get advertisements to the right audience, so targeting is more precise. The audience tends to be more engaged with the content vs traditional TV ads

Terrestrial (Traditional) Radio

  • Radio advertisements offer wide reach within a given geographic area. Coverage varies based on the station’s signal strength, on average 30-40 miles
  • The majority of Terrestrial Radio consumption occurs in the car as people commute to and from work and other trips
  • Out of home media is a great complement to Radio as consumers are generally driving while listening, also being exposed to out of home ads
  • Format and music genre greatly influence the different demographics of people that listen to stations. Before purchasing Radio advertising, buyers generally review the station profile, which includes things such as average listeners per hour with demographic breakdowns
  • Disc jockey (DJ) endorsements can be particularly powerful, as people tend to build trusted relationship with on-air personalities, sometimes over decades of listening
  • Radio is also highly utilized for promotions, e.g. a fast food chain promotes its limited time offering, a local bank announces a contest to win a scholarship, etc.

Magazines

  • Magazine advertising can be used to target specific reader demographics, and consumers tend to trust content in magazines
  • Magazines have a long life-span, and therefore give the opportunity for multiple impressions and a longer messaging drag time
  • There is the possibility of pass-on ad exposures. People find magazines to read at many different places while they are waiting, such as doctors’ offices coffee shops, grocery stores, etc.
  • Magazines can be used for both awareness and engagement; ads that contain QR codes, coupon codes, or unique URLs can be tracked for response

Newspapers

  • Newspapers have a wide economic and geographical reach
  • Placement options and pricing are generally negotiable
  • People tend to take newspaper advertisements more seriously than other ads because they appear on the same platform as important information like government announcements, for example
  • In addition to standard-sized advertising (Full Page, Half Page, etc), newspapers also often offer inserts, zoned sections, and premium placements such as front page strip ads, polybags, etc., for a more customized look and feel
  • Most newspapers have a digital version online as well, reaching readers who generally do not subscribe to the printed editions. Newspapers can be used for both awareness and engagement; print ads that contain QR codes, coupon codes, or unique URLs can be tracked for response

Direct Mail

  • Direct mail advertisements are a way for local businesses and companies to get the word out about their product or services on a regional scale
  • It takes a more personal approach because consumers perceive direct mail as a personalized message to them from a brand they like. Reports have even shown that 59% of mail recipients find excitement in retail mail about new products and campaigns
  • Direct Mail pieces usually contain QR codes, coupon codes, or unique URLs that can be tracked for response

Outdoor (OOH)

  • Outdoor advertising, a.k.a. out-of-home advertising, is advertising that reaches the consumer while they are outside of their home, for example, billboards, bus shelters, transit ads. They come in the form of static and digital ads
  • It is a great way to build solid brand familiarity and recall because it often gives consumers many impressions
  • Outdoor is used for awareness and is best in conjunction with other mediums, especially Radio
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