Ad Sales

A major source of revenue generated by television networks comes from adsales. (still looking for a rough percentage of how much)                                    The ad sales department traditionally consists of the actual sales force including employees at the assistant level, Sales Planners, Account Executives, Sales Manager, Vice President and President. Other departments that fall under sales or work directly with the sales team are Pricing and Planning who manages inventory, Sales Coordination who places units in programs and creates on air logs, Commercial Administration who is responsible for inserting the spot, getting it on air and running it by the correct guidelines of the advertiser, Standards and Practices will review spots to ensure they are appropraite to air and Integrated Sales who work on added value, features and specific sponsorships.

How it works

The currency used most in TV ad sales is a CPM. The CPM represents the price that it cost to reach one thousand viewers. It is calculated by taking the total cost of a campaign divIded by the total impressions delivered in the campaign schedule for example $100,000/5,000,000 = $20.00 CPM. Deals and CPM's are negotiaited during the annual televison upfront time period starting in May. The media buying agencies who represent the actual advertisers will register budgets with various networks in hopes to guarantee a certain amount of impressions for a desired demographic. Proposals are made and negotiated between buyers and account executives in May for the upcoming year. Networks usually sell 80% of their inventory in advance during this upfront period and the other 20 is sold in the scatter market which tends to be closer to the actual airing of programs and also comes at a premium since the inventory is limited by that time. Networks need to make yearly budgets which are created by reviewing available inventory to sell, projected sell out levels, a networks distribution, and estimated ratings.

Integrated Sales and On-Air Promotions

Money comes from parent department budget. 

MTV Networks, on-air promotions can fall under programming OR marketing, depends on channel.  On-air design usually falls under marketing and works closely with the off-air design/print departments. 

Turner Broadcasting (Cartoon Network, Boomerang, TCM, TBS, TNT, CNNetc) – Creative Services is a separate department with its own budget working in close co-operation with Programming and Marketing. 

ROI = higher ratings? 

Research department can determine which campaigns work best 

Distinguish between quantitative and qualitative research 

Use of Focus Groups 

Maybe we should consider having a separate page to dicuss the role of research?

One of the most fundamental questions is "Does on-air promotion work?" Research over the years clearly indocates that it does. Here are two links to some research results demonstrating the effectiveness on on-air promo campaigns: http://www.simulmedia.com/2009/07/yes-on-air-promotions-work/ and http://findarticles.com/p/articles/mi_m6836/is_4_47/ai_n25080269/?tag=content;col1 (this is an academic article examining audience targeting but it has a good bibliography of other research on the impact of "promotion frequency, distance, construction, clutter and placement".

Other internal benchmarks: awareness, intent to view, reach/frequency/GRPs.... executive praise

Integrated Marketing

i)       How does the business work: who sells what to whom and how is the money made?

ii)    What constitutes a target “margin” or ROI? Is this a profitable enterprise?

iii) Patterns of financing for production projects (including raising venture capital, foundation funding, government funding, advances on distribution, commercial projects, etc.)

iv)   How is success measured in this segment?

(1) By ratings?

(2) Box office?

(3) Sales?

(4) Critical Praise?

(5) Market share?

v)      Industry Benchmarks: reports, studies, organizations that regularly report on a field. For instance, search the Department of Labor.