MKT 500 Week 7 Scenario: Selecting Advertising Media and Determining Advertising Budgets Slide # Scene # Narration Slide 1 Scene 1 [Ed, Samantha – Ed’s Office] Ed and Samantha meet in the morning to discuss the next steps in the tablet PC launch. MKT_7_1_Samantha-1: Good morning, Ed. How are you doing today? MKT_7_1_Ed-1: Good morning, I’m doing quite well. Actually, I just left Carl’s office. He and I were discussing the next steps in our tablet launch. MKT_7_1_Samantha-2: Oh, really? What should we focus on next? MKT_7_1_Ed-2: Now that we have our strategy for managing our tablet’s pricing and distribution channels, we need to examine the media we are going to use to advertise the new tablets and the type of budget we are going to establish for advertising. MKT_7_1_Samantha-3: Yes, these are all important issues that need to be addressed prior to launch. To make prudent decisions concerning media selection, an understanding of the strengths and weaknesses of each media type is needed, and we have to keep in mind our integrated marketing communications, or IMC, as well as other mix variables, so that we send a consistent message about our product. This does not mean that the advertising will be identical across all media. Different media should offer supplemental and complementary information. MKT_7_1_Ed-3: You’re absolutely right, Samantha. We can use social media as our main media for advertising the new tablets. This would be consistent with our target market objectives. First, though, we should address the criteria for examining strengths and weaknesses of various media. The criteria used for examining strengths and weaknesses of the various media are cost, reach, frequency, how targeted it is, and ad content. The media we should consider are TV, Radio, Newspapers, Magazines, Billboard, Web, and Direct mail. Here is a summary of each type of media. Slide 2 Interaction Hover your mouse over the images of traditional and non-traditional media to learn more about the strengths and weaknesses of each. TV Strengths: reach, ability to demonstrate the product, and its vividness & ability to convey emotion are the greatest of any medium. It is also fairly strong at providing information. Weaknesses: not very targeted, low on frequency, weakest in terms of cost (by far the most expensive medium). Radio Strengths: able to convey vividness and emotion, relatively inexpensive (much less so than TV), adequate reach, frequency, and somewhat targeted. Weaknesses: less able to convey information, limited ability to provide product demonstrations. Newspapers Strengths: relatively inexpensive (much less so than TV), able to provide adequate amounts of information. Weaknesses: lack of reach, frequency, less targeted, relatively unable to demonstrate the product, lack of vividness & emotion. Magazines Strengths: among the best in reach, fairly targeted (not the best, not the worst), among the best at conveying information. Wea ...

1. MKT 500 Week 7 Scenario: Selecting Advertising Media and
Determining Advertising Budgets
Slide #
Scene #
Narration
Slide 1
Scene 1
[Ed, Samantha – Ed’s Office]
Ed and Samantha meet in the morning to discuss the next steps
in the tablet PC launch.
MKT_7_1_Samantha-1: Good morning, Ed. How are you doing
today?
MKT_7_1_Ed-1: Good morning, I’m doing quite well. Actually,
I just left Carl’s office. He and I were discussing the next steps
in our tablet launch.
MKT_7_1_Samantha-2: Oh, really? What should we focus on
next?
MKT_7_1_Ed-2: Now that we have our strategy for managing
our tablet’s pricing and distribution channels, we need to
examine the media we are going to use to advertise the new
tablets and the type of budget we are going to establish for
advertising.
MKT_7_1_Samantha-3: Yes, these are all important issues that
need to be addressed prior to launch. To make prudent decisions
concerning media selection, an understanding of the strengths
and weaknesses of each media type is needed, and we have to
keep in mind our integrated marketing communications, or IMC,

2. as well as other mix variables, so that we send a consistent
message about our product. This does not mean that the
advertising will be identical across all media. Different media
should offer supplemental and complementary information.
MKT_7_1_Ed-3: You’re absolutely right, Samantha. We can use
social media as our main media for advertising the new tablets.
This would be consistent with our target market objectives.
First, though, we should address the criteria for examining
strengths and weaknesses of various media.
The criteria used for examining strengths and weaknesses of the
various media are cost, reach, frequency, how targeted it is, and
ad content.
The media we should consider are TV, Radio, Newspapers,
Magazines, Billboard, Web, and Direct mail. Here is a summary
of each type of media.
Slide 2
Interaction
Hover your mouse over the images of traditional and non-
traditional media to learn more about the strengths and
weaknesses of each.
TV
Strengths: reach, ability to demonstrate the product, and its
vividness & ability to convey emotion are the greatest of any
medium. It is also fairly strong at providing information.
Weaknesses: not very targeted, low on frequency, weakest in
terms of cost (by far the most expensive medium).
Radio
Strengths: able to convey vividness and emotion, relatively
inexpensive (much less so than TV), adequate reach, frequency,
and somewhat targeted.
Weaknesses: less able to convey information, limited ability to
provide product demonstrations.

3. Newspapers
Strengths: relatively inexpensive (much less so than TV), able
to provide adequate amounts of information.
Weaknesses: lack of reach, frequency, less targeted, relatively
unable to demonstrate the product, lack of vividness & emotion.
Magazines
Strengths: among the best in reach, fairly targeted (not the best,
not the worst), among the best at conveying information.
Weaknesses: relatively expensive, lacks frequency (weekly,
monthly, quarterly), lacks ability to demonstrate the product.
Billboard
Strengths: among the least expensive, near the highest in terms
of frequency.
Weaknesses: not targeted, mediocre reach, provides minimal
information, unable to demonstrate product, lacks vividness and
emotion.
Social media and the Web
Strengths: least expensive (along with direct mail), high levels
of reach, frequency, information, able to demonstrate the
product, and targeted.
Weaknesses: can lack vividness & emotion.
Direct mail
Strengths: least expensive (along with Web), most highly
targeted, able to provide the most information, high levels of
reach and frequency.
Weaknesses: not able to demonstrate the product, lacks
vividness and emotion.

4. MKT_7_1_Ed-4: Hover your mouse over the images of
traditional and non-traditional media to learn more about the
strengths and weaknesses of each.
TV(heading not narrated)
MKT_7_1_Ed-4_A: Strengths: Television’s ability to reach
consumers, ability to demonstrate the product, , vividness, and
ability to convey emotion are the greatest of any medium. It is
also fairly strong at providing information.
MKT_7_1_Ed-4_B: Weaknesses: TV is not very targeted, is
low on frequency, and is weakest in terms of cost. It is by far
the most expensive medium.
Radio (heading not narrated)
MKT_7_1_Ed-4_C: Strengths: Radio is able to convey vividness
and emotion, is relatively inexpensive as compared to TV, has
adequate reach and frequency, and is somewhat targeted.
MKT_7_1_Ed-4_D: Weaknesses: Radio is less able to convey
information and has a limited ability to provide product
demonstrations.
Newspapers (heading not narrated)
MKT_7_1_Ed-4_E: Strengths: Newspapers are relatively
inexpensive as compared to TV, and are able to provide
adequate amounts of information.
MKT_7_1_Ed-4_F: Weaknesses: Newspapers may have a lack
of reach and frequency, may be less targeted, are relatively
unable to demonstrate the product, and lack vividness and
emotion.
Magazines (heading not narrated)
MKT_7_1_Ed-4_G: Strengths: Magazines are among the best
media in terms of reach, are fairly targeted (not the best, not the

5. worst), and are among the best at conveying information.
MKT_7_1_Ed-4_H: Weaknesses: Magazines are relatively
expensive, lack frequency because they are only published
weekly, monthly, or quarterly, and lack the ability to
demonstrate the product.
Billboard (heading not narrated)
MKT_7_1_Ed-4_I: Strengths: Billboards are inexpensive and
are near the highest of media in terms of frequency.
MKT_7_1_Ed-4_J: Weaknesses: Billboards are not targeted,
provide mediocre reach and minimal information, are unable to
demonstrate a product, and lack vividness and emotion.
Social Media and the Web (heading not narrated)
MKT_7_1_Ed-4_K: Strengths: These types of media are very
inexpensive, deliver high levels of reach, frequency, and
information, are able to demonstrate the product, and are
targeted.
MKT_7_1_Ed-4_L: Weaknesses: Social media and web-based
advertising may lack vividness and emotion.
Direct mail (heading not narrated)
MKT_7_1_Ed-4_M: Strengths: Mail is inexpensive, the most
highly targeted of all media, is able to provide the most
information, and has high levels of reach and frequency.
MKT_7_1_Ed-4_N: Weaknesses: Mail is not able to
demonstrate the product, and also lacks vividness and emotion.
Slide 3
Scene 1, cont.
[Ed, Samantha – Ed’s Office]

6. (Display formula)
GRP = Reach x Frequency
.10 x 112,000,000 = 11,200,000
.072 x 112,000,000 = 8,064,000
MKT_7_1_Samantha-4: Wow, that is a lot to consider. How can
we choose a media that will create awareness at our launch and
still stay within our budget? You mentioned the terms “reach”
and “frequency“ - Tell me more how these metrics will be used
to determine the ad budget.
MKT_7_1_Ed-5: In order to determine the advertising budget
using the method based upon strategic goals, an exposure goal
should be set. This requires an understanding of how
advertising exposures are measured. An exposure goal is based
in GRPs, or Gross Ratings Points. A good exposure goal for our
launch would be one hundred GRP’s.
MKT_7_1_Samantha-5: How do we go about achieving that
goal?
MKT_7_1_Ed-6: Let’s start with reach. Reach is the percentage
of the target audience seeing an ad at least once. The goal is to
expose as many members of the target audience as possible to
the ad, using media that is most cost-efficient for finding the
target audience.
Next, we should consider frequency. Frequency is the average
number of times the target audience sees the ad within a
specified time period. The number of exposures is based upon
the marketing and advertising goals. For a goal of awareness,
fewer exposures would likely be needed than if the goal is
persuasion. Unfamiliar and complex products would probably
need more exposures than well-known, simple products.
MKT_7_1_Samantha-6: Okay. I’m following you. Are those the
only items we need to consider for achieving our exposure goal?

7. MKT_7_1_Ed-7: Not quite. Lastly, we can combine these to
come up with GRPs. In terms of television, a ratings point is a
measure of viewership of a particular television program. One
single television ratings point is equal to one percent of
households with TVs.
MKT_7_1_Samantha-7: Hmmm, could you maybe give me an
example to clarify that point a little?
MKT_7_1_Ed-8: Sure. Let’s say that there are an estimated one
hundred nine point six million television households in the
United States. Thus, a single national household ratings point
represents one percent or one million ninety-six thousand
households for a TV season.
GRP is the total of all rating points for an advertising campaign.
MKT_7_1_Samantha-8: How do you calculate GRP?
MKT_7_1_Ed-9: Good question! GRP is equal to reach times
frequency.
(Display formula)
Let’s say there are one hundred twelve million homes measured
in the United States. A show with a rating of ten would mean
that eleven point two TVs are tuned to that show. A seven point
two rating for a show would mean that eight point zero six four
million TVs were tuned to the show. You get the idea.
Actually, I have a short video that I think will be very helpful in
explaining this concept.
Slide 4
MBTV: Rating Points, Reach & Frequency
http://www.youtube.com/watch?v=gxuokqMv2rg

8. Slide 5
Scene 1, cont.
[Ed, Samantha – Ed’s Office]
MKT_7_1_Samantha-9: Thanks for that video, Ed. Now I
understand why reach and frequency are so important for our
tablet’s advertising campaign. How can we use this information
to help us determine our advertising budget?
MKT_7_1_Ed-10: We would use this information to determine
the level of TV exposure for our tablet. A high GRP provide
Golds Reling a very strong TV exposure level during our initial
launch.
MKT_7_1_Samantha-10: Ed, this sounds complicated. Reach?
Frequency? GRP’s? Is there an easier way to create our
advertising budget?
MKT_7_1_Ed-11: Yes, but we can crunch the media numbers
using the formulas for GRP’s and present them to Carl this
afternoon. Moving on to the ad budget, here are the three
choices we can present to Carl.
One - Calculate the advertising budget as a percentage of last
year’s sales.
Two - Spend approximately what we believe is parity with
competitors.
Three - Use our strategic advertising goal, and work backward
to calculate necessary expenditures.
MKT_7_1_Samantha-11: Sounds good - what details can we
present to Carl?
MKT_7_1_Ed-12: The first method is easy. The only challenge
would be determining the value of the actual percentage. Most

9. companies begin with their past numbers or an estimate of the
industry norm, and then adjust. If a company’s marketing goal
is merely to maintain brand share, then roughly the percentage
that it and its competitors spent the previous year should
suffice. If a company has done something newsworthy with the
brand, an increase in advertising monies is in order to get the
word out; and if a company is seeking to milk the brand and
redirect funds to its other brands, the percentage would be
adjusted slightly downward.
MKT_7_1_Samantha-12: I understand. What about the second
method we could present to Carl?
MKT_7_1_Ed-13: Well, the second method is also relatively
easy. There are media service providers, such as Schonfeld,
Saibooks, or Nielsen, who keep tabs of how much companies in
various industries tend to spend. If every competitor spent
approximately the same percentage on advertising, then their
market shares would be proportional to their ad spending
shares. I don’t think this will be the case in our situation. Apple
has been around longer than Golds Reling and most likely has a
huge advertising budget.
MKT_7_1_Samantha-13: What about the third method?
MKT_7_1_Ed-14: The last approach is to be more strategic and
treat advertising expenditures as an investment, with the
expectations that an investment should return sales and profits.
This approach is somewhat challenging because advertising
effects are difficult to measure and are often intended to
produce long-term effects. To set an ad budget, a company
needs to understand how advertising exposures are measured,
then set its exposure goal, and then estimate how much to spend
to achieve that goal.
MKT_7_1_Samantha-14: Hmm, I believe we should go with a
combination of methods two and three. This way we can get a

10. better handle on what Apple, Google, HP, Kindle and others are
spending on their advertising in the domestic and international
markets for their tablets.
MKT_7_1_Ed-15: I agree. I’m thinking that TV and social
media will be our best media choices.
MKT_7_1_Samantha-15: That sounds like a good idea. The high
GRP’s accrued through TV advertising will provide great
exposure for the new tablets. Integrating this with social media
should provide great results.
MKT_7_1_Ed-16: This is all excellent information. Let’s put it
together in a cohesive package that we can share with Carl.
Slide 6
Scene 2
[Ed, Samantha, Carl – Conference Room]
Ed, Samantha, and Carl meet in the conference room to discuss
the advertising aspects of the product launch.
MKT_7_2_Carl-1: Good afternoon, Ed and Samantha. I saw you
both looking very busy in Ed’s office earlier. I’m looking
forward to hearing the information that you two have put
together for advertising our tablet.
MKT500_7_2_Samantha-1: Yes, Ed and I have been very busy.
What we discovered causes us to ask three questions.
MKT_7_2_Carl-2: And what would those be?
MKT500_7_2_Samantha-2: To run a successful ad campaign for
Golds Reling, we need to consider these three key questions.
Slide 7
Interaction
Click the tabs to learn more about the three media questions that
a company should answer when running advertising promotional

11. campaigns.
What
A) How much do we spend?
There are three main ways to determine this.
1) Base the budget as a percentage of last year’s sales
2) Spend about the same as competitors
3) Spend what is necessary to meet the advertising goal
B) When do we spend?
When to advertise is an important consideration. There are three
different types of schedules a company can choose.
1) A continuous schedule has a fairly regular ad exposure.
2) With an occasional schedule, the ad comes on from time to
time.
3) With a seasonal ad, the strategy focuses on advertising before
an event, such as Christmas, Memorial Day, etcetera.
C) Which media do we use as channels of our communications?
There are many media available to advertise on: TV, radio,
magazine, newspaper, billboard.
The strategy of Integrated Marketing Communications (IMC)
should be used to decide what media to use. IMC is a company
communicating a consistent message across all media outlets.
This includes the traditional media mentioned above (TV, radio,
etc.), product placements, personal selling, direct selling,

12. product design, and packaging.
MKT500_7_2_Samantha-3: Click the tabs to learn more about
the three media questions that a company should answer when
running advertising promotional campaigns.
What
MKT500_7_2_Samantha-4_A: How much do we spend?
There are three main ways to determine this:
One - Base the budget as a percentage of last year’s sales
Two - Spend about the same as competitors
Three - Spend what is necessary to meet the advertising goal
MKT500_7_2_Samantha-4_B: When do we spend?
When to advertise is an important consideration. There are three
different types of schedules a company can choose.
One - A continuous schedule has a fairly regular ad exposure.
Two - With an occasional schedule, the ad comes on from time
to time.
Three - With a seasonal ad, the strategy focuses on advertising
before an event, such as Christmas or Memorial Day.
MKT500_7_2_Samantha-4_C: Which media do we use as
channels of communications?
There are many media available to advertise on: TV, radio,
magazine, newspaper, and billboard are among the most
popular.
The strategy of Integrated Marketing Communications, or IMC,
will help us decide what media to use. IMC refers to the
practice of a company communicating a consistent message
across all media outlets.

13. This includes the traditional media mentioned previously, such
as TV or radio, product placements, personal selling, direct
selling, product design, and packaging.
Slide 8
Scene 2, cont.
[Ed, Samantha, Carl – Conference Room]
MKT500_7_2_Samantha-5: Ed and I feel that we have the media
question answered, and we will work diligently to complete the
reach, frequency, and GRP’s, which will help in budgeting. This
will provide a more systematic method for answering the other
two questions and setting our advertising budget.
MKT_7_2_Carl-3: And what ideas have you come up with
regarding advertising media for our tablet?
MKT500_7_2_Samantha-6: We need to investigate a variety of
advertising media in addition to TV and social media, which we
have already discussed. These should include radio, magazine,
newspaper, outdoor, web, and direct mail. Eventually, we want
our integrated marketing communications to extend beyond
traditional advertising to include personal selling, public
relations, publicity, product placement, sponsorships,
promotion, and social media.
MKT500_7_2_Ed-1: To ensure that we are spending our money
wisely, the key is to coordinate the different IMC elements
selected and to have consistency in message among them.
Measuring effectiveness becomes difficult across the many
different elements, but measuring recall, attitudes, click rates,
and response rates from communications such as direct mail,
coupons, and rebates will be useful.

14. MKT_7_2_Carl-4: This is very impressive. I am in agreement
with the advertising media strategy you have recommended.
Golds Reling is in good hands with both of you in charge of this
launch. Before you leave, let’s recap a few of the key takeaways
that we covered today.
Slide 9
Check Your Understanding
Match the term with the correct description.
Reach - the percentage of the target audience seeing an ad at
least once
Frequency - the average number of times the target audience
sees the ad within a specified time period
GRP - the total of all rating points for an advertising campaign
IMC – A consistent message the company communicates about
its product or service across all media outlets
Slide 10
Scene 3
[Ed, Samantha – Hallway]
MKT500_7_3_Samantha-1: Wow, we really covered a lot of
ground today with our advertising plans. We have many media
options available to us for advertising, so we really need to be
sure our integrated marketing communications are consistent
across all media we choose.
MKT500_7_3_Ed-1: You’re absolutely right, Samantha. We
also have an e-Activity and the weekly threaded discussion on
advertising and setting advertising budgets, where we can
discuss this further. See you next week!
"Advertising Media and Integrated Marketing Communications
(IMC)" Please respond to the following:.
1. From the scenario, distinguish between two to three (2-3)
different types of advertising media available for the new
product launch. Provide two (2) suggestions for the marketing

15. intern that will help her to create an advertising budget.
2. From the e-Activity, create a new advertising message for a
company of your choice using Attention, Interest, Desire, and
Action (AIDA). Determine the fundamental manner in which
you will measure the effectiveness of the advertising message
and how it aligns with corporate strategy (e-Activity: Use the
Internet to research the current advertising message(s) for a
company of your choice. Be prepared to discuss)