You have been asked to create a Media Plan in promoting a movie given the following information from the TGI Colombia Study.

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1 UPVCC Advertising Class, 1/28/2010 CASE : MEDIA PLANNING FOR 2009 MOVIE You have been asked to create a Media Plan in promoting a movie given the following information from the TGI Colombia Study. The TGI Colombia study is a consumer survey of 7,035 persons in Colombia conducted by IBOPE Columbia during The study covers demographics, media and product usage from a population of 12,493,000 persons between the ages of 12 to 64 years old. A very traditional approach would be to define a target group in terms of demographics. The most common demographic variables are those that are related to age, sex and socioeconomic class. If we want to target people who go to movies, then a typical definition would be persons between the ages of 16 to 34 years old from high/middle socioeconomic class. The age qualification is motivated by observing that the typical audience in a cinema tends to fall into that age range. The socio-economic qualification is motivated by the consideration of the price of movie tickets relative to earnings. According to the TGI Colombia study, 3,929,000 (or 31.4%) of the survey universe are persons 16 to 34 years old from the upper/middle socio-economic classes. However, there is a suspicion of imperfection about this definition. On one hand, one does not believe that all movie-goers are between the ages of 16 and 34 years old. On the other hand, one does not believe that all persons between the ages of 16 and 34 years old are movie-goers. By virtue of the fact that movie-attendance behavior is measured in the TGI Colombia study, we can analyze the efficacy of the age/sex/socio-economic definition. On one hand, of the 3,929,000 persons between the ages 16 and 34 years old from the high/middle socio-economic classes, 1,245,000 (or 32%) of them went to the movies in the last six months. If we compare this against the 22% (2,782,000 out of 12,493,000) movie-attendance rate in the general population, this is higher. But the fact remains that 68% of this target group did not go to the movies in the last six months. On the other hand, of the 2,782,000 persons who went to the movies in the last six months, 1,245,000 (or 45%) are between the ages of 16 and 34 years old from the high/middle socio-economic classes. If we compare this against the 31% (3,929,000 out of 12,493,000) incidence in the general population, this is higher. But the fact remains that 55% of movie goers do not fall into this target group. The choice of using a definition based only upon age/sex/socio-economic class is dictated by a historical lack of movie-attendance information in media planning/buying databases. Given that we have the TGI Colombia study, the more natural target definition should be

2 based upon movie attendance itself. Furthermore, with this rich database, we can introduce some refinements as well. One of the axioms in marketing is that a small proportion of the population may account for a large share of the consumption. Sometimes, this is referred to as the rule % of the people account for 80% of the consumption. Now this rule is unlikely to work in an exact quantitative sense across all product categories. Thus, while one can increase daily coffee consumption dramatically, one cannot be expected to use hair coloring products several times a day. Thus, the exact numerical value for this rule should be evaluated on a case-by-case basis. For the movie attendance situation, the TGI Colombia study provides frequency information. Those people who attended movies within the past six months were also asked if they went to the movies once or more per week, 2 or 3 times per week, once a month, once every two or three months or less often. We can then construct the following worksheet: Frequency of Movie-going Once or more per week Two or three times per month Number of times per month Number of persons Number of persontimes per month (=tickets) , , ,000 1,197,000 Once a month , ,000 Once every 2 to 3 months , ,000 Less frequently ,000 0 TOTAL 2,782,000 2,972,000 (source: TGI Colombia, IBOPE Colombia) Thus, if we count up just the number of persons who attend movies once or more per month, we have (156, , ,000) = 1,316,000 persons (or 47% of all movie goers) who account for (702, ,197, ,000) = 2,580,000 person-times (or 87% of all person-times). Thus, about half of the people account for almost 90% of all movie tickets sold. Thus, one logical target that can be derived from the TGI Colombia study is persons who attend movies at least once a month. From here, we can build a media plan around these people. Here are some facts about them: Of the 1,316,000 persons in the target group, 651,000 (=50%) are between the ages of 16 and 34 from upper/middle socio-economic classes. These 1,316,000 persons account for 87% of all movie tickets sold. This study contains a vast amount of information about the usage of media vehicles which can serve as advertising media. The media behavior for these people are sometimes radically different from the general population or the

3 traditional age/sex/socio-economic target. For example, in response to the question, Do you regularly listen to radio in a private transport?, we have these responses: All persons between the ages of Persons in upper/middle socio-economic classes Persons who attend movies at least once a month % listen to radio in private transport 19% 21% 39% (source: TGI Colombia, IBOPE Colombia) According to a study of persons between the ages of 12 to 64 years old, conducted in Panama City, the overall usage levels of six major media are: 97.9% watched broadcast television 90.7% listened to radio 58.7% read newspapers 46.7% read magazines 25.6% watched cable/satellite television 19.9% used the Internet In a consumer survey of the same age bracket (12 and 64 years old) we asked respondents to rate their attention to advertisements in various media on a five-scale, with 5 meaning always. From this survey, here are the percentages of people who give the highest rating of 5 to each medium. Attention Levels to Different Media by Persons % 17.1% 9.8% 8.1% 6.4% Attention Levels to Different Media by Internet Users (past 30 days) 27.6% 13.9% 11.8% 9.4% 18.6% As pointed out in different studies, there are differences between people who use Internet for entertainment versus for informational purposes. Given their different goals, it is conceivable that they might have different attitudes towards advertising. The following two tables show the attentional levels for these two groups of Internet users.

4 Attention Levels to Different Media by Entertainment-seeking Internet Users (past 30 days) 20.2% 8.2% 9.4% 7.9% 21.5% Attention Levels to Different Media by Information-seeking Internet Users (past 30 days) 27.7% 15.0% 11.6% 10.2% 19.8% In the case of the entertainment-seeking Internet users, we actually see that the Internet is the medium that commands the most attention from them! We also analyze the results of a study of business travelers. In the first graph, we have charted the indices of the business travelers versus the general population for television viewing in general by the half-hour during the weekday (Monday through Friday). An index of 100 would imply the same viewing rates. An index greater than 100 would imply that the percentage of business travelers watching television is greater than the percentage among the general population, thus conferring greater efficiency. From this graph, as one might have guessed for this group, the working hours are the most inefficient for reaching business travelers; in fact, the best opportunities during the weekday is when they get up in the morning and after they reach home at night. (Source: TGI Argentina Study, IBOPE Argentina)

5 In the second graph, we have charted the indices of the business travelers versus the general population for radio listening in general by the half-hour during the weekday (Monday through Friday). As with television viewing, the working hours are the most inefficient for reaching business travelers. Again, the early morning and late evening give the best opportunities. Comparing the two graphs, we note that there is a phase difference in the morning. More specifically, 6am-7am is a good time to reach them as they wake up, eat breakfast and get dressed, while watching television; 7am-8am is a good time to reach them as they travel to work with the radio on. (Source: TGI Argentina Study, IBOPE Argentina) These two graphs serve to illustrate how media planning may work. In practice, the process extends to many more media types and vehicles, including (and not limited to) television dayparts, television programs, broadcast television networks, cable/satellite television networks, radio dayparts, radio programs, radio stations, newspaper titles, newspaper sections, newspaper magazines, newspaper inserts, magazine titles, airline inflight magazines, Internet advertising and all sorts of outdoor advertising displays. To compete for advertising budgets, the media have to position themselves to advantage. For some media, one can in fact speak of built-in characteristics for their audiences. In another study, among these respondents, 45% of them are magazine readers, 45% are newspaper readers, 33% are cable/satellite television viewers and 16% are internet users. Therefore, these four media do not have the near universal penetration of broadcast television and radio. In the next figure, we show the media usage levels separately for the top two socioeconomic levels (Level A = top 10% and Level B = next 20%), managers, professionals and college graduates. For each demographic group, the media usage levels are much higher than the total population. This type of pattern can be found on a country-bycountry basis, whether in Latin America or elsewhere.

6 (source: TGI Latina ) These patterns of media usage can be said to be built-in or intrinsic because a selfselection process is in operation. Print readership is obviously tied in with socioeconomic level (=ability to purchase), education (=ability to read) and occupation (=professional needs). Cable/satellite television is tied in with socio-economic level since subscription television is costly. And internet usage is tied in with computer access and literacy. For these four media, these built-in characteristics make it easy to position their advantages. At the most basic level, the media usage by demographic groups reinforces what should be commonsense. Therefore, these four media find it easy as an industry to argue their case for their 'fair' share of advertising expenditures. Furthermore, these patterns are inherited by individual products and services. In the next chart, we show the situations for a number of products and services. For each and every product/service, the media usage level is significantly higher than in the general population. The three pieces of the equation --- [demographic characteristics], [media usage] and [product usage] --- are in fact inextricably linked together. (source: TGI Latina )