PPM how to measure radio effectively

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PPM how to measure radio effectively

• SEMPL 2008

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Todays agenda

• Some financial facts
• From Average Quarter Hour to minute-by-minute
  Ratings
• Changing the Price of Radio Advertising
• Managing the Inventory
• Future possibilities

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Ad Spending
Radio had the largest growth (23,9)
Year-On-Year
Share of Market Q2 2008
Source IRM
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In 2005 the CPT on radio was 52 NOK.In 2008 it is
108! TV is 200
2006 - 261 million NOK through media
agencies 2008 - 360 million NOK!
P4 breaks advertising-records
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Radio is taking larger share from the advertisers
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Radio is still optimistic for the future
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The Portable People Meter system PPM
http//ppm.arbitron.com/
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Issues

• Editing rules
• Panel size
• Small stations require larger panel
• More detailed breakdowns require larger panel
• Panelists must comply
• Software and reporting

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Advantages with PPM

• Daily updated audience measurement
• More accurate method -gt more confidence in radio
• Very similar method to TV (in Norway at least)
• ...but it is expensive...

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A Brief Overview
National Radio
Commercial Radio
Market Share Q3 2008
Market Share Q3 2008
Source TNS Gallup, National PPM Radio Survey
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Higher Reach With Same Definition
Average weekday 2007
AQH PPM vs. AQH CATI
1000
1400
1800
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Big Difference 15 min. cume to 1 min. net
Average weekday 2007
AQH PPM vs. AQH CATI
1000
1400
1800
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How did we set the price of 1 GRP?

• Put 1 spot in every hour, every day, for a week
  162 spots
• Value with spot pricing 1 200 000 NOK
• PPM 1 min. definition ? 315 GRP
• Result CPT increased by 32

1 200 000 NOK 315 GRP
3810 Cost Per Point
Used April/May 2006 average
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Challenges

• Estimating future ratings
• Predicting inventory and sold-out ratio
• Over- and Under-delivery
• Most of the salesforce had little knowledge of
  the new rating currency
• Tighter control
• Increase Traffic function
• Handling a decline in ratings (shortage of
  inventory)
• Changing the placement of a block

Solutions
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Detailed reports of a campaigns performance
Simple overview
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Planning Split Analysis (3)

• Scenarios
• 100 P4
• 80 P4, 10 K24, 10 SBS
• 60 P4, 10 K24, 30 SBS

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Single-Source Planning
Reach ()
Frequency
Source PPM Radio TV test-data, TNS Gallup
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To sum up...

• Radio has had an amazing growth in advertising
  turnover after the introduction of PPM as the
  currency
• Radio advertisement has become more precise
• You can report and you radiodata in your
  trackingstudies
• Better utilization of inventory (resources)
• Reach goes slightly up, frequency down
• Single-Source Radio/TV-planning is next!