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Could CPA Replace CPP on Traditional Media Buys—and What If It Does?

May 28, 2016

From time to time, I’m asked to give presentations on changing media trends to ad agencies. A few weeks ago, I presented our Radio on the Move study on in-car audio listening to a major Canadian agency. A couple of radio reps had joined me for the meeting. As we were packing up our gear, the senior media planner threw us for a bit of a loop.

 

As impressed as she was that radio listening is still holding up in the car, she felt that the big reason that radio is struggling to get on the big ad buys is not an issue of listening, but the way it’s sold. 

 

In her view, traditional media is simply not dealing in the right currency. While the traditional media still sell on CPP (or cost-per-point), her clients are shifting to CPA (or cost-per-action). They’ve been trained by digital media to expect that they can track the effectiveness of every dollar spent. (Never mind that digital has its own ROI issues.)  And her clients are becoming increasingly reluctant to spend any ad dollars that don’t deliver the same accountability. They want to pay for actions, not for airtime, ad space, ears or eyeballs. And, by the way, the clients she was referring to weren’t selling miracle creams or vegetable slicers—these were big brands, products and services that don’t lend themselves to direct response ads. 

 

Talk about a splash of cold water. What do we do with our investment in audience measurement if audience size doesn’t matter? How do we measure actions on every major buy? What actions? An increase in awareness or brand favourability? Are we going to have to gamble our ad inventory on the effectiveness of the creative developed by the agency and/or the client? 

 

It just doesn’t seem fair. But then again disruption rarely does. 

 

As one of the reps most adroitly said as we were heading down the elevator: “How many things can you buy today that are sold the same way they were 20 or 30 years ago?”

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Could CPA Replace CPP on Traditional Media Buys—and What If It Does?

May 28, 2016

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