Software keeps ad deals on the level

Feb 11, 2002  •  Post A Comment

Subscribing to the philosophy that fixing an advertising deal in the middle of the contract is better than repairing it at the end, several cable networks have begun to implement an advertising management software program that should allow them to project the number of impressions an ad will deliver and track whether that forecast exceeds or falls below expectations during the course of the ad’s run.
Comedy Central, A&E Television Networks and Oxygen Media have signed on to use the new Stewardship software from Management Science Associates of Pittsburgh. The software is designed to predict whether a network will deliver the number of impressions guaranteed in an advertising contract, and it in turn allows the cable networks to make mid-course corrections or adjustments to those deals.
The software module, designed to work on a stand-alone basis or as part of MSA’s Gabriel ad traffic and billing system, is the next-generation version of MSA’s DOS-based software product called M-Track.
By looking at the status of a deal every day as well as ratings data, a network can see if it is underdelivering the contracts and needs to add audience deficiency units ( additional ads to make up for the lost impressions). In turn, if the network learns that it will overdeliver, it can recapture future spots and sell them to other advertisers, said Phil Antonson, director of sales and business development at MSA.
“It allows them to make more efficient use of their inventory. The more efficient use they make of it, the more money they make,” he said.
Without a system like this that tracks the delivery of an advertising deal, networks need to analyze data from so-called “post-buy reports” at the end of the month or the quarter and then schedule audience deficiency units, which may often run later than when an advertiser wants the spots to appear. Also under that scenario, a network is unable to resell ads if it overdelivered during the quarter.
“If at the end of the quarter you overdeliver, you lose the potential money you could have made selling those ads at a nice rate,” said Dan Le Roy, VP of advertising operations for Oxygen Media. “If we have a large ratings increase, we can pull back recaps that we had for ADUs. If you overdeliver, you leave money on the table.”
Oxygen is scheduled to launch the system by early next month, before Nielsen begins to measure the cable outlet for the first time in the middle of this year. “We want to have this in place well before we have ratings, so we can be responsible to our advertisers,” Mr. Le Roy said.
Comedy Central plans to run MSA’s Stewardship software starting March 1 and test it for six months alongside the “homegrown” software it has been using for inventory forecasting over the last few years, said Long Ellis, VP of sales planning and operations for the network. While useful, the Microsoft Excel-based in-house system is labor-intensive, requires a week or more of set-up time each quarter and is not as automated as Stewardship, Mr. Ellis said.
Still, having such a system over the past few years has been immensely beneficial in managing ad contracts, he said. If a network is measured by Nielsen and offers guarantees to its advertisers, then not knowing where the inventory forecasts stand at any given moment can result in a lot of angry advertisers, he said.
“It’s very dangerous for networks not to have an idea of ratings liability,” he said. “It’s too late at the end of the quarter.”
A&E Television Networks implemented the Stewardship system last fall as a replacement for M-Track. The advantage of the new system is that one can view the inventory every day as opposed to every week, and it forecasts inventory on a per-show basis rather than by daypart, said Mona Tropeano, VP of sales administration for A&E Television Networks.
All three networks use MSA’s Gabriel system and chose Stewardship in part because it integrates easily into their existing systems. In addition, MSA is considered the company of record when it comes to providing third-party post-buy reports to cable networks, which in turn give those reports to advertising agencies at the end of each quarter.
MSA integrates data from Nielsen and 49 cable networks to produce its reports.