Agencies

Manage Client Expectations on Cost of Entry

Underscore Marketing's Tom Hespos on The MakegoodOver the course of my career, I’ve worked for clients with many different degrees of experience with media.  I’ve had clients who came from the agency side and ran their own in-house agencies (and who had more media experience than me), and I’ve had clients who were new to the job with no experience using advertising.  Generally, though, a typical client has a hands-off approach to paid media and has some very basic preconceptions about what it costs to put together an ad campaign.

Some of those preconceptions might include:

 

  1. A sense of which media are good for which kinds of messaging challenges.  They might be carrying around ideas that radio is generally good for building frequency or that digital is good for reaching niche audiences.
  2. A basic understanding of the cost of entry for supporting a product or service with paid media.  That might be in the form of “Don’t consider television unless you have $X to spend” or “An OOH campaign in the top 10 DMAs will cost a minimum of $Y.”
  3. An idea of what the working media and agency fee mix should be for an entry-level campaign.

I’ve seen countless articles written about how to challenge preconceptions in #1 and #3.  But I haven’t seen much written about #2, and some of those preconceptions require revision, especially as digital technology lowers the cost of entry for advertisers.

The preconceptions about cost of entry can come from a simple notion, like the idea that one wouldn’t want to give a product print support unless the brand can afford to place at least a 6X schedule in a handful of targeted magazines.  On the digital side, it can come from the buy minimums sales reps impose on advertisers – on a per-site basis, those buy minimums might be $10K/month.  When advertisers have smaller budgets, they tend to defer to these mental shortcuts and fail to consider paid media because they don’t think they have enough money to support it.

But what happens when digital technologies provide new ways to reduce the cost of entry?  Here are some examples:

  • Buying digital display on the ad exchanges, coupled with a contextual or conceptual engine that informs buy/no buy decisions, can get highly relevant inventory on an impression-by-impression basis.  The cost of entry is less dictated by buy minimums and more by audience size and the reach/frequency that can be achieved over time on the sites an advertiser can reach through programmatic buying.
  • Buying digital OOH lowers the commitment levels needed for an effective campaign.  Instead of multi-month commitments to billboards costing tens or hundreds of thousands of dollars, think buying a day or a week of taxi or hotel lobby screens.  The technology allows advertisers to quickly get in or out of market and still have a significant impact.
  • Working with media selling partners to repurpose existing creative assets can save a lot of money that would ordinarily need to be earmarked for a creative agency.  Especially when dealing with new, innovative or native ad formats, media partners will often have creative services people on staff who can provide creative as added value to the media buy.  This decreases cost of entry yet further.

When you start to think about the lower limit of campaign sizes being dictated by reach and frequency instead of buy minimums or creative agency fees, you begin to realize that you may have clients walking around with incorrect assumptions about what it takes to support their products with paid media.

So get out there and correct those assumptions, so that you can open the realm of possibilities for your advertising clients.

Tom Hespos is a contributor at The Makegood and Founder and Chief Media Officer at Underscore Marketing, a boutique firm that creates and manages digital marketing programs.
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