Relying on Attributable CPS vs. CPM for Media Buying
17 November 2015 • tvsquared

For years, TV agencies have negotiated discounted rates and value-add for clients. You’d know these firms were doing a good job for your company by negotiating a reduced CPM (cost per mille). And while getting a discount is great, does it mean anything if the advertising is not achieving the desired objectives?

Traditionally, TV media buying has been buying an untargeted, mass audience – not an individual, but rather a large number of eyeballs. You’re buying gender and age group and that’s about it. When advertisers set success metrics for TV, they are often around these gross-rating points (GPRs) and have nothing to do with response.

Rather than relying on CPM, advertisers need to start planning and optimizing their campaigns based on attributable CPS (cost per sale). This encompasses not just a target audience, but what drives results within that audience. It measures advertising success based on the actions generated.

Think about it this way: the same TV show that attracts an advertiser’s ideal demographic could perform very differently depending on day, time or network. Planning based on CPM might get you in front of that audience, but planning based on CPS will get you in front of the right people within that group at the most optimal time for response.

With attributable CPS, the WAY you buy media might not change, but you can buy more efficiently by getting a better sense of what’s working and what’s not on the same day a spot airs. This type of data allows you to attribute back to the appropriate networks and dayparts that are driving traffic. Better understanding your CPS also optimizes your spend by buying the right things.

Leveraging a combination of same-day and historic performance data (much of which advertisers are already sitting on) puts you in front of your target demographic at a time when they are most likely to respond.