Advertising Challenge

How advertising agencies buy space

One of the most important functions of advertising today is still buying advertising space. Although the definition of space has expanded passed the frontiers of traditional mass media, a lot of money is still invested in television or newspaper advertising as we can see from the following table. In fact, these two media account for more than half of all advertising expenditure, and more than four times as much as online advertising.

Media or channel planners, as the space merchants are known today, make decisions based on data that is collected from the Australian viewing public such as you and me. Here’s an example...

Based on the share of the Top 25 television programs from February to April 2007, 68% of all people 16-39 and 48% of all grocery buyers with children watch Channel 10. However, Channel 7 is the most popular station overall with 52% of all people tuning in. Popular shows such as Biggest Loser, Big Brother, House and Rove on Channel 10 and Ugly Betty, Grey’s Anatomy, Desperate Housewives and Dancing with the Stars on Channel 7 reach millions of viewers each week.

This helps media planners decide which show their commercial should run on.

Top Advertisers

You’re probably very familiar with the people who spend the most money on advertising in Australia. Many are our largest retailers like Coles Myer, Harvey Norman and Woolworths. Of course, we would expect our largest manufacturers like Nestle/L’Oreal, Procter and Gamble, Toyota and General Motors to be there as well. But you may be surprised to find out that one of the largest advertisers in Australia is the Federal Government, usually the second largest advertiser in Australia and sometimes even the largest in an election year such as 2007! Many of the state governments like the Victorian Government, the NSW Government and the Queensland Government also round out the top ten largest advertisers in Australia.