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The challenge of finite airtime

Ready to grow your business using Direct Response TV (DRTV) advertising? Eager to see how this unique ROI-driven broad media channel can drive measurable response? Great! But you will discover – with only 24 hours in every day — there’s a lot more going on than immediately meets the eye.

While most people focus on creative and messaging, the team responsible for planning and buying your media time when “time” is in demand, can be just as (or more) crucial to making your efforts pay out than copy, your director, or on-screen talent.

Why 2016 presents a critical challenge to your DRTV campaign’s ROI

In general, TV advertising runs on a somewhat normal cycle. But not every year is “normal.” Every four years TV advertisers (particularly direct response advertisers) have the added complexity of trying to be seen and heard amid the turmoil of a presidential election.

To understand the challenge this presents, consider that marketing channels can be broadly divided into two categories: infinite and finite.

 
• Infinite marketing channels include direct mail, email, online and mobile ads, and telemarketing. There is no limit to how many pieces of mail can be sent to a person nor Facebook ads placed. Yes, the volume of messaging can require you to up your game regarding design, packaging, and copy to get noticed, but there’s always room for more marketing.

 
• Finite channels make it harder. These are primarily TV, radio, and billboards, which each have a set allocation of advertising time or space. For example, you don’t often see new billboard locations pop up along expressways – billboard ads rotate, but the locations are limited. The same goes for the number of TV and radio ad minutes in a day.

Advertisers fight for a finite number of advertising minutes/hour, an even greater challenge in an election year.

You are literally in the middle of a “media war” for time

The math is inescapable. All television and radio advertisers compete for a fixed amount of available ad time each hour, day, week, and campaign period.

According to a Los Angeles Times article (“TV networks load up on commercials” by Joe Flint; May 12, 2014), “In 2009, the broadcast networks averaged 13 minutes and 25 seconds of commercial time per hour. In 2013, that figure grew to 14 minutes and 15 seconds.” While the available minutes and seconds of advertising time per hour has bumped up slightly over the years, there is still a limited number of spots that can run on a network each hour.

Political campaign seasons make this competition for time a real battle. It takes a toll on general and direct response advertisers. Ads have been going strong since the beginning of the year for presidential primaries and local elections and will only increase throughout the year.

While political ad dollars flood the market, nonpolitical advertisers still strive to make their marketing campaigns succeed. Which means their spots must run at some point. The fight to get your spots to clear in the remaining time slots gets fierce. This is especially critical for insurance companies marketing Medicare or ACA plans, which have a government-mandated annual advertising period that overlaps with the presidential election.

This is where clearance comes into play.

What is clearance? What separates a winning clearance strategy from a loser?

Clearance is the percentage of your booked schedule which actually airs. It is calculated by the amount of your spending, not the number of spots. But before I explain more, let me mention the types of things that can negatively impact clearance rates:

 
• Buy management (shifts in spending between stations and/or dayparts; negotiating lower rates)
 
• Breaking news (severe weather, world events, etc.)
 
• Supply and demand
   
  • Brand advertising (back to school, Black Friday, etc.)
   
  • Political advertising (Presidential, primary, congressional, gubernatorial, and mayoral)

   

Here’s an example to help explain the impact of lower clearance. Most DRTV advertisers begin their planning with a set advertising budget and duration for a campaign (see Figure 1).

Now, let’s say we have a budget of $100k and will be booking $10k worth of advertising each week for 10 weeks. However, due to other advertisers placing ads in the same blocks, we may only clear 80% of the time. That could result in seeing below-target clearance (i.e., your audience not seeing enough of your message) … leading to generating too few leads and unspent dollars that are not working to achieve your campaign goals.

Fig. 1: Clearance in a Typical DRTV Advertising Campaign
In this example, just 75% of spots cleared. This leaves $25k in unspent allocated dollars. If our return (lead volume for spots aired) was as expected or less, you would not achieve your campaign goals. But you needn’t settle for numbers that add up like this!

Active campaign management is a must to deliver direct marketing results

As you can see in this case, planning ahead isn’t enough. Ongoing, hands-on refinements are mandatory to make the program a success. We evaluate each week of the campaign, make sound decisions, and adjust the buy as necessary to ensure that we’re deploying each client’s budget the best way possible to meet— or exceed! – campaign goals.

Conversely, if you order $100k of ads over 10 weeks and then wait until AFTER the campaign has ended to evaluate, you are almost guaranteed to throw away money and opportunity. Active campaign management is critical.

The skill and expertise involved in media buying for DRTV is much like trading on the floor of the stock exchange. I’ll grant you, the pace isn’t quite as frenzied (and you’re not physically elbow to elbow with the competition), but the concept is similar.

Buying advertising isn’t a “buy low and sell high” activity. More accurately, you need to know the market(s) you’re playing in and where to hedge your bets – that expertise comes from experience as well as consulting previous campaign results as a guide.

What happens when the best laid plans don’t pan out?

What if your clearance is lower than expected? If your spots aren’t clearing well, you probably aren’t meeting campaign lead and revenue goals. What do you do?

As we say in the broadcast world: “stay tuned.” I’ll share some tips in a post soon. Fortunately, we are adept at managing the factors surrounding clearance to make our clients’ DRTV campaigns successful, but we’re running out of space in this post. In the meantime, you can read more about DRTV here or contact us to see if DMW Direct can help improve your direct response campaigns.