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Pricing in Media May 7 th , 2009 <ul><li>Ian Cruickshank </li></ul>
Quick Overview <ul><li>Who is this guy? </li></ul><ul><li>Media landscape  </li></ul><ul><li>The Class </li></ul><ul><li>T...
Who is this guy? <ul><li>I ’ m just like you </li></ul><ul><li>Undergrad  </li></ul><ul><li>6 years in Media </li></ul><ul...
The Media Landscape <ul><li>Traditional or Legacy  </li></ul><ul><ul><li>Newspaper/Magazines </li></ul></ul><ul><ul><li>Te...
The Media Landscape <ul><ul><li>Television </li></ul></ul>
The Media Landscape <ul><ul><li>Non-Traditional/New Media </li></ul></ul><ul><ul><ul><li>Out of Home & Digital OOH </li></...
The Class <ul><li>“ Pricing is the moment of truth - all of marketing comes to focus in the pricing decision ”  Corey 1962...
The Class <ul><li>Where do we fit in to the four current practices </li></ul><ul><ul><ul><li>Cost-based, Customer-driven, ...
The Class <ul><li>Customer-driven </li></ul><ul><ul><li>Supply and Demand </li></ul></ul><ul><ul><li>Negotiation  </li></u...
The Class <ul><li>Competition-driven </li></ul><ul><ul><li>Monopoly  </li></ul></ul><ul><ul><li>Oligopoly </li></ul></ul><...
The Class <ul><li>Russian Proverb: There are two fools in the market. One does not charge enough. The other charges too mu...
The Class <ul><li>Psychology in pricing </li></ul><ul><ul><li>Newspaper pricing & perceived value </li></ul></ul><ul><ul><...
The Class <ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><ul><li>Segmentation </li></ul></ul></ul></ul><ul><u...
The Class <ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><ul><li>Buyer location  </li></ul></ul></ul></ul><ul...
The Class <ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><li>Yield </li></ul></ul></ul><ul><ul><ul><ul><li>Wh...
The Class <ul><li>Channels </li></ul><ul><ul><li>Direct </li></ul></ul><ul><ul><li>Agency </li></ul></ul><ul><ul><li>adbid...
Traditional Examples <ul><li>Newspaper </li></ul><ul><ul><li>WTP </li></ul></ul><ul><ul><li>Price Discrimination </li></ul...
Traditional Examples <ul><li>Newspaper </li></ul><ul><ul><li>Rate Card </li></ul></ul>
Traditional Examples <ul><li>Television </li></ul><ul><ul><li>WTP </li></ul></ul><ul><ul><li>Time & Volume </li></ul></ul>...
Traditional  Examples <ul><li>Television </li></ul><ul><ul><li>Rate Card </li></ul></ul>
Traditional Examples <ul><li>Radio </li></ul><ul><ul><li>WTP </li></ul></ul><ul><ul><ul><li>S&D, Sales Volume, Demographic...
Traditional  Examples <ul><li>Radio </li></ul><ul><ul><li>Rate Card </li></ul></ul>
<ul><li>Radio </li></ul><ul><ul><li>Submision </li></ul></ul>Traditional Examples
Non-Traditional <ul><li>Out of Home & Digital OOH </li></ul><ul><ul><li>S&D, Seasonality, Volume, Number of Markets, Demog...
Non-Traditional <ul><li>Creative variations </li></ul>
Non-Traditional <ul><li>Creative variations </li></ul>
Non-Traditional <ul><li>Creative variations </li></ul>
Non-Traditional <ul><li>Digital </li></ul><ul><ul><li>Metrics and Analytics  </li></ul></ul><ul><ul><li>CPM, CPC, CPA, CPL...
Non-Traditional <ul><li>Digital </li></ul><ul><ul><li>Rate Card  </li></ul></ul>
Non-Traditional <ul><li>Digital </li></ul><ul><ul><li>Targeting = pricing in $CPM </li></ul></ul><ul><ul><ul><li>Mass Impu...
Non-Traditional <ul><li>Digital </li></ul><ul><ul><ul><li>So where is digital media pricing going? </li></ul></ul></ul><ul...
 
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Pricing in Media

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Here is a presentation that I gave to an MBA class at the UBC Sauder School of Business. Let me know if you have any questions .

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Transcript of "Pricing in Media"

  1. 1. Pricing in Media May 7 th , 2009 <ul><li>Ian Cruickshank </li></ul>
  2. 2. Quick Overview <ul><li>Who is this guy? </li></ul><ul><li>Media landscape </li></ul><ul><li>The Class </li></ul><ul><li>Traditional Examples </li></ul><ul><li>Non-Traditional Examples </li></ul><ul><li>35 Min + 15 for Questions </li></ul>
  3. 3. Who is this guy? <ul><li>I ’ m just like you </li></ul><ul><li>Undergrad </li></ul><ul><li>6 years in Media </li></ul><ul><li>Radio Guy </li></ul><ul><li>... moved to print? </li></ul><ul><ul><li>Don ’ t worry - Digital </li></ul></ul>
  4. 4. The Media Landscape <ul><li>Traditional or Legacy </li></ul><ul><ul><li>Newspaper/Magazines </li></ul></ul><ul><ul><li>Television </li></ul></ul><ul><ul><li>Radio </li></ul></ul>
  5. 5. The Media Landscape <ul><ul><li>Television </li></ul></ul>
  6. 6. The Media Landscape <ul><ul><li>Non-Traditional/New Media </li></ul></ul><ul><ul><ul><li>Out of Home & Digital OOH </li></ul></ul></ul><ul><ul><ul><li>Digital </li></ul></ul></ul><ul><ul><ul><ul><li>Online Display </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Online Search </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Mobile </li></ul></ul></ul></ul>
  7. 7. The Class <ul><li>“ Pricing is the moment of truth - all of marketing comes to focus in the pricing decision ” Corey 1962 </li></ul>
  8. 8. The Class <ul><li>Where do we fit in to the four current practices </li></ul><ul><ul><ul><li>Cost-based, Customer-driven, Competition-driven, Value-based </li></ul></ul></ul><ul><li>Customer and Competition-driven </li></ul>General Media Pricing
  9. 9. The Class <ul><li>Customer-driven </li></ul><ul><ul><li>Supply and Demand </li></ul></ul><ul><ul><li>Negotiation </li></ul></ul><ul><ul><li>Budget </li></ul></ul><ul><ul><li>National vs. Local Retail </li></ul></ul>
  10. 10. The Class <ul><li>Competition-driven </li></ul><ul><ul><li>Monopoly </li></ul></ul><ul><ul><li>Oligopoly </li></ul></ul><ul><ul><li>Competition </li></ul></ul><ul><ul><li>Cannibalization </li></ul></ul>
  11. 11. The Class <ul><li>Russian Proverb: There are two fools in the market. One does not charge enough. The other charges too much. </li></ul><ul><li>Or the competition doesn't charge enough... </li></ul><ul><li>DON ’ T LEAVE MONEY ON THE TABLE!! </li></ul>
  12. 12. The Class <ul><li>Psychology in pricing </li></ul><ul><ul><li>Newspaper pricing & perceived value </li></ul></ul><ul><ul><ul><li>“ It ’ s time for the Newspaper Industry to Die ” </li></ul></ul></ul><ul><li>Yet Circulation is still Strong in Canada </li></ul>
  13. 13. The Class <ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><ul><li>Segmentation </li></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Local vs. National </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Direct vs. Agency </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Consumer type & Industry </li></ul></ul></ul></ul></ul>
  14. 14. The Class <ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><ul><li>Buyer location </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Time of purchase </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Quantity/Volume </li></ul></ul></ul></ul><ul><ul><li>Bundling </li></ul></ul>
  15. 15. The Class <ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><li>Yield </li></ul></ul></ul><ul><ul><ul><ul><li>Which Media? </li></ul></ul></ul></ul>Perishable products with fixed capacity Variations in WTP and arrival purchasing time
  16. 16. The Class <ul><li>Channels </li></ul><ul><ul><li>Direct </li></ul></ul><ul><ul><li>Agency </li></ul></ul><ul><ul><li>adbid.ca </li></ul></ul><ul><ul><ul><li>Channel conflict? </li></ul></ul></ul>
  17. 17. Traditional Examples <ul><li>Newspaper </li></ul><ul><ul><li>WTP </li></ul></ul><ul><ul><li>Price Discrimination </li></ul></ul><ul><ul><ul><li>Time & Volume </li></ul></ul></ul><ul><ul><li>Value perception vs. effectiveness </li></ul></ul>
  18. 18. Traditional Examples <ul><li>Newspaper </li></ul><ul><ul><li>Rate Card </li></ul></ul>
  19. 19. Traditional Examples <ul><li>Television </li></ul><ul><ul><li>WTP </li></ul></ul><ul><ul><li>Time & Volume </li></ul></ul><ul><ul><li>CPM/GRP </li></ul></ul>
  20. 20. Traditional Examples <ul><li>Television </li></ul><ul><ul><li>Rate Card </li></ul></ul>
  21. 21. Traditional Examples <ul><li>Radio </li></ul><ul><ul><li>WTP </li></ul></ul><ul><ul><ul><li>S&D, Sales Volume, Demographic, Ratings </li></ul></ul></ul><ul><ul><li>CPM/GRP </li></ul></ul>
  22. 22. Traditional Examples <ul><li>Radio </li></ul><ul><ul><li>Rate Card </li></ul></ul>
  23. 23. <ul><li>Radio </li></ul><ul><ul><li>Submision </li></ul></ul>Traditional Examples
  24. 24. Non-Traditional <ul><li>Out of Home & Digital OOH </li></ul><ul><ul><li>S&D, Seasonality, Volume, Number of Markets, Demographic </li></ul></ul><ul><ul><li>Creative variations </li></ul></ul>
  25. 25. Non-Traditional <ul><li>Creative variations </li></ul>
  26. 26. Non-Traditional <ul><li>Creative variations </li></ul>
  27. 27. Non-Traditional <ul><li>Creative variations </li></ul>
  28. 28. Non-Traditional <ul><li>Digital </li></ul><ul><ul><li>Metrics and Analytics </li></ul></ul><ul><ul><li>CPM, CPC, CPA, CPL, CPT... </li></ul></ul><ul><ul><li>Trackable/traceable </li></ul></ul>
  29. 29. Non-Traditional <ul><li>Digital </li></ul><ul><ul><li>Rate Card </li></ul></ul>
  30. 30. Non-Traditional <ul><li>Digital </li></ul><ul><ul><li>Targeting = pricing in $CPM </li></ul></ul><ul><ul><ul><li>Mass Impulse Buy < $1.00 </li></ul></ul></ul><ul><ul><ul><li>Demographic = $5.00 </li></ul></ul></ul><ul><ul><ul><li>Psychographic = $7.00 - 10.00 </li></ul></ul></ul><ul><ul><ul><li>Contextual = $15.00 - $25.00 </li></ul></ul></ul><ul><ul><ul><li>Behavioral = $40.00 - 80.00+ </li></ul></ul></ul>
  31. 31. Non-Traditional <ul><li>Digital </li></ul><ul><ul><ul><li>So where is digital media pricing going? </li></ul></ul></ul><ul><ul><ul><li>The new job of a media company is to be a Data company </li></ul></ul></ul><ul><ul><ul><li>Information is pricing power </li></ul></ul></ul>
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