TV advertising balanced scorecard indicators

TV advertising means using TV to advertise a company's product/service. Because of high exposure, glamour and audio-video impact of television, it has become the favorite medium for launching new products, raising brand awareness and building brand loyalty, re-positioning brands and also motivating employees and supply chain partners of the advertising organization. TV advertising is characterized by rather poor targeting, very high price per contact, fast response speed, low response percentage and low response volume. It means that targeting and costs become two principal issues for control over efficiency.

A major recent trend is in development of direct response TV advertising, in which a viewer is given a telephone number and invited to call for more information or to place an order. This kind of television can boast medium targeting, low cost per contact and better possibilities for control.

Main indicators that are used to measure TV advertising activities are reach, OTS (opportunity to see), ratings - TVRs (Television Ratings)/CRPs (Gross Ratings Points)/TARPs (Target Audience Rating Points) and others. However, they differ in relevance and application. As to the application, the indicators may be subdivided into those required at planning stage, those required for control and those that can be used at the both stages.

The planning stage is vital because of high expenditures involved, so every possible means of measurements should be used. The most efficient are TVRs, OTS and CPT (cost per thousand). The general advice for ad scheduling is to purchase at least 250-300 TVRs, giving 70% coverage and a minimum of three OTS in order to make a TV campaign worthwhile. Besides these indicators allow for budgeting and campaign planning and if used in combination produce fairly precise results. The good news is that now many TV stations make/purchase panel researches of their viewers and supply the research results to their advertising clients. However, it does not apply to local TV stations as they could hardly afford panel researches. Besides, a company will have to buy the information about competitors' activities, if it needs precise calculations for SOV (share of voice) and SOM (share of market) indicators.

Among the indicators used at the stage of control there are awareness growth, inquiries growth, Cost TV ad /Sv (cost of press advertising to sales volume ratio), Cost TV ad /Sn (cost of press advertising to sales number ratio) and all the indicators with internal perspective that allow for control over activities of advertising and marketing departments. The control procedures over TV advertising campaign always present a certain issue, largely because sales and revenues are not directly related to advertising. The reasons also include TV ad clutters and viewers' media habits, like switching to other channels, leaving the room during commercial breaks, etc. The advertising directly influences awareness, knowledge, perception etc. that, as a rule, can be measured with a help of specialized research. However, the above-mentioned indicators reveal trends and therefore may be considered as additional means of control, especially when direct means are somehow unavailable. Most of the information can be obtained wi

thin the organization and the calculations are not difficult as well.

The indicators that could be used at both stages are those connected with awareness, SOV and other measures where input and output values are important for advertising campaign evaluation and market trends analysis.