Media management : a casebook approach [3rd ed] 9781410608956, 1410608956

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Media management : a casebook approach [3rd ed]
 9781410608956, 1410608956

Table of contents :
Content: Managerial decision making --
Leadership and the workforce --
Motivation --
The global structure of media organizations --
Technology and the future --
Regulation and self-regulation --
Planning --
Market analysis --
Marketing and research --
Budgeting and decision making.

Citation preview

Third E dition

Media Management A Casebook Approach Jan LeBlanc Wlci

time FIC. 5.2.

------------------H ow newspaper change occurs.

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o f b u s i n e s s / p r o d u c t o b je c t iv e s a n d “ define th e ir b u s i n e s s ’ id en tity w ith in w h a t ­ e v e r fu tu re c o m e s ” ( B r o w n & E is e n h a r d t, 1998, p. 148). T h is is n o t th e s a m e as stra te g y o r the v i s i o n a r y ’s too l o r p lan fo r e x e c u t in g the v isio n. N o r is it the s a m e as se e in g the fu ture; e v e n the m e d ia o p e r a t io n s th at u sed v id e o t e x t in th e 1980s w e re p ro b a b l y u n a w a r e th e y w e re w o r k in g o n the f o r e r u n n e r o f the Internet. M a n a g e r s c re a te v is io n s not o u t o f thin air, b u t th r o u g h m e t h o d ic a l ly th in k in g a b o u t the future and e valu a tin g the w a n ts and need s o f the o rg a n i z a ti o n ’s client g ro u p s (N a n u s, 1992). M a n a g e r s m u st acq u ire o r d ev e lo p stru ctures and pro cesses to in itiate an d fo s te r v is io n (S y lv ie & W it h e r s p o o n , 2 0 0 2 ). R e c a ll the illustra tion o f T h e N e w Y o rk T im e s o n lin e o p e ra tio n . R e q u iri n g u se rs to e le c tro n ic a lly r e g i s ­ ter a ll o w e d the o rg a n i z a ti o n to c reate a c o n ti n u o u s flow o f in f o r m a t io n a b o u t u s e r ha bits, in te rests, an d w a n ts , c re a t in g an in s ta n t re s e a rc h an d d e v e l o p m e n t ( R & D ) too l ( N e w m a n , 2 0 0 2 ). T h is to ol e n a b le d T im e s m a n a g e r s to g e n e ra t e data an d s e r v e d as a d y n a m i c s o u r c e o f c o n s t a n t f e e d b a c k , w h ic h m o s t op en s y s te m s h a v e in c o m m o n (K a tz & K a h n , 1978). T h e T im e s o n li n e m a n a g e m e n t te am u sed the f e e d b a c k to b ra i n s to r m p r o d u c t p o s s ib ilitie s a n d c o n ti n u a ll y e x p lo r e the o n ­ line m e d i u m ’s p o te n tia l to se r v e r e a d e r an d a d v e rt is e r interests. V is io n b e c a m e a n atu ra l, in te g ra l p a rt o f m a n a g i n g , e n a b lin g m a n a g e r s to “ w in to m o r r o w to d a y ” ( B r o w n & E is e n h a r d t, 1998, pp. 1 2 7 - 1 2 9 ) . T h e ab ility to c o n s ta n tly as s e s s and e v a lu a te the p r o d u c t p e rm it te d the o n lin e m a n a g e r s to ta ke stra te g ic , c o rr e c tiv e a ction. B rand

A w areness.

Enhanced,

te c h n o l o g ic a l ly

d riv e n

products

re q u ire

m e d ia m a n a g e r s to u n d e rs ta n d th ey h a v e a n ic h e and an id e n tity to m a i n ta i n and e x p a n d . T h is w o rk s s e v e r a l w a y s . F o r e x a m p l e , lo cal b r o a d c a s te rs h a v e lim ite d re s o u rc e s w ith w h ic h to c o v e r and g e n e ra t e n e w s . W h e r e a s a ty p ic a l sm a ll-c ity n e w s p a p e r h a s o n e j o u r n a l i s t p e r e v e r y 1,000 cir c u la tio n , a c o r r e s p o n d in g lo cal T V s ta tio n m i g h t h a v e o n e fifth th at n u m b e r . A s a result, T V n e w s d ir e c to r s c o n ­ sta n tly s earch fo r w a y s to s u p p l e m e n t local re p o r tin g . O n e s o u r c e is th e s t a ti o n ’s affiliated n e tw o rk , w h ic h d aily p ro v i d e s se v e ra l h u n d r e d s to ries to local affiliates v ia satellite t e c h n o l o g y . A lo ca l statio n ca n e x p a n d its n e w s c a s t , a p p e a ri n g to h a v e its o w n re g io n a l, n atio n a l, an d in te rn a tio n a l c o r r e s p o n d e n ts (B a rk in , 2 0 0 1 ), th u s e x t e n d i n g its b ra n d . T h e In te rn e t a ll o w e d all tr a d itio n a l m a s s m e d i a to im p l e m e n t th is b r a n d e x ­ te n s io n . M o s t W e b sites o f local n e w s p a p e r s , rad io, an d T V sta tio n s e m p h a s iz e certain distin ctiv e ty pes o f c o n te n t (Lin & Jeffres, 2001 ). R adio fo c u se s on statio n/ b r a n d i n g p ro m o ti o n ; T V sites e m p h a s i z e the s a m e , p lu s fe a tu re e -m a il, fe e d b a c k , an d se a rc h d e v ic e s , m a k i n g t h e m s e l v e s into m u l ti s o u r c e re p o s ito r ie s. N e w s p a p e r sites h ig h l ig h t c o m m u n i t y se rv ic e , a d v e rtisin g , a n d n e w s service s. F u tu r e m e d i a m a n a g e r s (o r at least th o s e d riv e n by te c h n o l o g y - s e n s it iv e p r o d ­ ucts) m u s t learn and gain a d v a n ta g e from the p rev io u s e x p e rie n c e and current b ra n d in g o f the trad itio nal p rod uc t. F o r e x a m p le , w h e n v ideo rental stores started re p la c in g V H S - f o r m a t v id eo tap ed films w ith films on digital vid eo d iscs (D V D s ),

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the stores w ere not sim p ly trying to c atch up to in creasin g sales o f D V D players. T h e y w ere le arning from their e x p erien ce with vid eo c u sto m ers as to w h at c o n ­ stitutes a c o m fo rta b le v iew in g e x p e rie n c e (E m lin g , 2002). T h a t sort o f thinking he lped E .W . Scrip ps Co., traditionally v iew ed as a n e w s p a p e r c o m p a n y , to b ran ch into cab le T V and start H o m e & G a rd en T elevisio n N e tw o rk s (H G T V ). H G T V ’s success led to the d e v e lo p m e n t o f the F o od N e tw o rk and the D o It Y o u rse lf netw o rk (M o ses, 2000). In su m m a ry , a b ra n d -c o n sc io u s m ed ia m a n a g e r m ak es the future hap p en th ro u g h a new tech no lo gica lly driven prod uct, thus e n ergizes the existing b u sin ess (B ro w n & E isen hardt, 1998).

S u p e r i o r S u p e r v is in g . Finally, te c hn olo gy as p ro d u c t forces ch a n g e s in the w a y m a n a g e rs h an d le e m p lo y e e s, especially in the co m in g era o f c o n v e rg e n c e (and e xp erim en tatio n ). C o o p e ratio n is required w h en m ed ia c o n v e rg e to pro d u ce a collab orativ e, c ro s s-p ro m o tio n al product. A nation al study o f p h oto editors and W e b directors o f n ew sp ap ers that publish on lin e and p a p e r edition s found virtu ­ ally no c o m m u n ic a tio n or c o ord ina ted co v e rag e plan (Z avo in a & R eichert, 2000). M a n a g ers like to talk a b o u t synergy, b ut C h ic a g o Tribune ed itor H o w ard T y n e r (D c d in s k y , 2 000 , p. 4 5 ) noted it is e asier said than done: Y o u h av e to b e h a r d - n o s e d a b o u t it. Y o u 'l l run into a situ atio n w h e r e the print p e o p l e c o m e up w ith an idea for a c a b le s h o w , a nd t h e y ’ll g e t th eir n o se s o u t o f jo i n t w h e n the c a b le g u y s c o m e b a c k an d say, “T h a t ’s a really d u m b idea a n d will n e v e r w o r k . ” B u t the p r in t g u y s will sa y , “ H o w can they tell m e ? ” P rin t p e o p l e are no t T V p e o p l e a n d v i c e v ersa, and e a c h lo o k s at it in a d if fe r e n t w ay .

C o n v e rg e n c e often tr anslates into m o re w ork fo r the c on verge e. H o w d oes a n ew s d irector persu ad e her rep orters to sw itch from the no rm al n e w s cycle to a day o f habitual online up datin g, several cable n ew s ap p ea ran ce s , sharing story in form atio n w ith print reporters, and p ro du cin g their o w n stories for the last b ro adc ast? E ach 2 -m in ute s e g m e n t on the local TV n ew s takes a n e w s p a p e r re ­ p orter a w a y from his reg u lar w o rk 2 to 5 ho urs a w eek (R abasca, 2001). C o v in g to n (1 99 7) studied fou r T V stations op eratin g in a tec hn olo gic ally challeng ing m arket. S uccessful m a n a g e rs noted their s u b o r d in a te s ’ e x p erien ce s with the p ro d u c t a nd fou nd that w h at su b o rd in a te s le arned tra nsfo rm ed them and helped the product. F o r e x am p le, ex p erie n c ed repo rters and a nch ors w ere given in creased respo nsibility so th ey did no t feel c au g h t in a d ead -e n d jo b. S u p e rv is­ ing and re w ard in g them required m a n a g e rs to use in no vativ e a p p ro a ch es to m o t i­ vation and ev alua tion. K anter (20 01 ) said the Internet transfo rm e d c o m p a n i e s ’ internal, h u m a n aspects. S u ccessfu l W e b firms ad o p ted the notion o f co m m u n ity as an internal, o rgan izin g fram ew o rk. D eep b o n d s d ev elo p e d a m o n g em p lo y e e s, w ho generally exhibited a w illin gn ess to do m ore b ecau se they w ere inspired by the c o m p a n y ’s ideals and c ollectively felt respo nsible to serve “ in the cause o f a g reater g o o d ” (K anter, 2 00 1, p. 98).

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O t h e r M a n a g e ria l Im pacts O p e n s y s te m th e o r y te a c h e s th at m a n a g e r s m u s t e v a lu a te w ith in th e c o n te x t o f the o p e ra t in g e n v ir o n m e n t . C o n t e x t o ften in d irec tly s h a p e s th e te c h n o l o g y via m a n a g e m e n t p e r c e p t io n s a b o u t c o m p e t it io n , m a r k e t sh are, a n d legal r e g u la tio n s , as w e ll as the o r g a n i z a t i o n ’s in tern al e n v ir o n m e n t . T h e s e im p a c ts re s u lt in c h a n g e , w h ic h v aries w ith th e situatio n. L e v e l o f C o n tr o l.

T e c h n o l o g y c h a n g e s the n a tu re o f the m a n a g e r ’s w o rk .

Iro n ic a lly , m a n y c o m p a n i e s a d o p t te c h n o l o g ie s to g ain g re a t e r c o n tro l o v e r a v a ­ riety o f facto rs, in c lu d in g o p e ra tio n s , the b u d g e t, the m a r k e t, e m p l o y e e b e h a v io r , o r p r o d u c t d is trib u tio n . A lth o u g h m a n a g e r s o ften see th e t e c h n o l o g y as ste erin g the p ro c e s s , it d o e s n o t a lw a y s w o r k that w a y b e c a u s e te c h n o l o g y h as d e sira b le o r u n d e s i ra b le c o n s e q u e n c e s . F o r e x a m p le , ju s t as c o m p u te riz a tio n g iv e s a m a n a g e r m o r e tim e and control o v e r d e a d lin e s an d c o p y sta n d ard s, it m a y m a k e him o v e rre lia n t on c o m p u te rs. H e loses s o m e con tro l o v e r his ability to w o rk w h en the c o m p u te rs crash o r electricity fails. A c o m p a n y that ch e rish e s such con tro l will e x p e rie n c e resistan ce from e m ­ p lo y e es w h o d rea d the inevitable n e w -a n d - i m p r o v e d versio n o f the tech n o lo g y . W h e n a s m a ll p u b lic rela tio n s a g e n c y a d d s te l e c o n f e r e n c in g ca p a b ility , the e m p l o y e e s g ain r o u tin e a c c e s s to r e g u l a r tr a in in g w ith o u t tra v e lin g . T h e y a c q u ir e a d v a n c e d sk ills— le a r n in g sk ills the a g e n c y m a n a g e r a lo n e o n c e k n e w . T h is r e p ­ r e s e n ts a loss to the m a n a g e r , w h o r e l in q u i s h e s sole c o n tr o l o f th o s e skill areas. S h e n o w m u s t p la c e in c r e a s i n g trust in h e r s ta ff— a fa ct tha t m a y p r o m p t s o m e c o n t r o l- m in d e d e x e c u t iv e s to p a u se . F u n c tio n a l A d ju stm en t.

O th e r m a n a g e r ia l f u n c t io n s su ch as staffing, o r g a ­

niz ing , and m o t iv a t in g also e x p e r i e n c e the s a m e ty p e s o f c h a n g e s d i s c u s s e d e a r ­ lier. N o w h e r e is this m o r e e v id e n t th a n in the c a se o f the W e b , w h e r e the o n s l a u g h t o f o n lin e p u b li c a ti o n s ta u g h t m a n a g e r s to r e th in k th e ir m a n a g e r ia l a c ­ tion s to m a k e th e ir W e b sites viab le. In g e n e ra l, a m a n a g e r staffs by d e te r m i n in g h u m a n re s o u rc e ne ed s: re c ru itin g , sele c tin g , an d tr a in in g e m p l o y e e s . T h e W e b c o m p e l s the m a n a g e r to recruit, s elect, an d train e m p l o y e e s to u se the W e b , the e a se o f w h ic h d e p e n d s on the te c h n o l o g y an d c o m p a n y ’s p e rs o n n e l. N e w s p a p e r m a n a g e r s f o u n d th a t W e b staffing v aries w id e ly d e p e n d in g on the s i t e ’s m is s io n a n d the n e w s p a p e r ’s c u r ­ re n t W e b e x p ertise . C o n s i d e r o n e e d ito r w h o s e s m a ll -to w n d a ily starte d a W e b p a g e w h e n print e dition s t a ff lev els w e re d o w n . T h e r e w e re no c o m p e t e n t local W e b w riters, so the e d ito r r e c r u ite d sta ffe rs o n lin e to in te rv ie w s u b je c ts b y p h o n e an d c o m m u n i ­ cate w ith the n e w s p a p e r m a n a g e r s by In tern et. O n lin e s to ries w e r e h a n d le d a b o u t the s a m e w a y as p rin t sto ries, w ith m o s t b e in g fe a tu re -o r ie n te d , tre n d -ty p e p ie c e s. T h e re p o r te rs e x p la i n e d th e ir r e l a ti o n s h ip w ith the n e w s p a p e r to th eir

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so u rc e s. A n e d ito r a s s ig n in g a story n otified local s o u r c e s th a t an o n lin e r e p o r te r m a y call. P ro b l e m s e n s u e d fr o m a lack o f c o o rd i n a ti o n o f o n lin e a s s ig n m e n t s ; no o n e k n e w w h ic h o n lin e w rit e r w a s w o r k in g on w h ic h story. T h e n e w s p a p e r c re a te d an o n lin e e d it o r p o sitio n to c o n f e r w ith the re p o r te rs , m a k e a s s ig n m e n t s , a n d p r o ­ m o te th e ir c o p y in d aily n e w s b u d g e t m e e tin g s . T h e r e also w a s low o n lin e r e ­ p o rte r m o r a le r e g a r d in g s o u r c e a cc e ss . “ P e o p le d o no t call m e b a c k , b e c a u s e it is lo n g d i s ta n c e ,” o n e o n lin e r e p o r te r sa id. “ T h e y c a n ’t u n d e r s ta n d h o w s o m e b o d y th o u s a n d s o f m iles a w a y c o u ld be w ritin g a sto ry fo r th e (lo cal) p a p e r .” A d ju s t m e n t s f o l lo w e d b e c a u s e o f m a n a g e m e n t ’s initial v iew o f th e te c h n o l ­ o gy . M a n y m a n a g e r s see the W e b an d o th e r te c h n o l o g ie s fro m the p e rs p e c ti v e o f “ W h a t can it d o f o r u s ? ” r a t h e r than “ W h a t ca n it d o to u s ? ” T h e c o m p a n y ’s go als , o b je c tiv e s , an d p la n s often p r e d a te e q u i p m e n t p u r c h a s e s an d u su a lly fo l­ low e c o n o m i c r a t h e r th an m a n a g e r ia l c o n s i d e ra t io n s . A n e f f e c tiv e m e d i a m a n ­ a g e r a d ju s ts in a tim e ly fashio n.

EXTERNAL IM P A C T Technology's Im p a c t on M arkets N o w t e c h n o l o g y ’s e ff e c ts on e x te r n a l e n v i r o n m e n t s are d is c u s s e d . F irst the e f ­ fe cts o f o n e su ch e x te r n a l f a c t o r— m a r k e t s — are d is c u s s e d . R e c a ll th a t te c h n o l ­ o g y is u su a lly v ie w e d as a to ol o r m e a n s to w a r d s o m e e n d . M e d i a m a n a g e r s b a s ic a lly see t e c h n o l o g y as a w a y to c h a n g e o r c re ate a m a r k e t, b u t th a t c h a n g e can v ary. C o m p etitio n .

T e c h n o l o g y often a ll o w s en try into a m a r k e t th a t m o s t w o u ld

h a v e th o u g h t c lo s e d . F o r e x a m p l e , in the late 1990s, the sm a lle r, less c o m p e t it iv e w ire l e s s c a b le T V in d u s try b e g a n to u se dig ital c o m p r e s s i o n to b e tt e r c o m p e t e w ith w ire d c o u n te r p a rt s . D ig ita l c o m p r e s s i o n a llo w s c a b le o p e r a t o r s to j a m m o r e c h a n n e l s into less s p a c e fo r the s a m e p ric e as c o n v e n ti o n a l w ire d c a b le T V . T h is o p p o r t u n it y w a s e n h a n c e d b e c a u s e m a n y c ab le o p e r a t o r s w e re slow to d ig itally e q u ip th e ir m a r k e ts , a lr e a d y p r o n e to s ig n al o u ta g e s . A d d the e x is tin g in te re s t by re g io n a l t e l e p h o n e c o m p a n i e s an d the c a b le m a r k e t s e e m e d p o is e d fo r drastic change. S im ila rly , the In te rn e t c h a n g e d m a r k e t c o n c e p t io n s fo r e le c tro n ic n e w s p a p e r s . N o l o n g e r d o e s a n e w s p a p e r in S an Jo s e h a v e the safe, re la tiv e m o n o p o l y o f its p rin t e d itio n w h e n it starts an o n lin e v e rs io n . T h e e le c tro n ic e d itio n a llo w s T a i w a n e s e n e w s p a p e r s to c o m p e t e w ith the S an Jo s e p a p e r in the a d v e rtis in g and in f o rm a t io n m a r k e ts for the large C h i n e s e a n d C h i n e s e - A m e r i c a n a u d ie n c e (C h y i & S y lv ie , 1998).

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Y e t t e c h n o l o g y can be so e x p e n s i v e tha t th e p rice d riv e s s o m e c o m p a n i e s o ut o f b u sin e ss. T o see h o w t e c h n o l o g y can d im in i s h c o m p e t it io n , c o m p a r e tw o c o m p e t i n g lo cal T V s ta tio n s in a m a r k e t. A s s u m e the le a d in g statio n e n h a n c e s its p ro d u c t (an d m a r k e t s h are) by in v e s tin g s e v e r a l m illio n d o lla rs in c a p ita l i m ­ p r o v e m e n ts , su ch as a new an d re n o v a t e d s tu d io , n e w c a m e r a s , new s o u n d e q u ip m e n t, an d a satellite n e w s g a th e r in g m o b i le van . T h e result is a clea re r, c ri s p e r p ic tu re w ith b e tte r v id e o fo o ta g e , m o r e c o lo r fu l b a c k g r o u n d g ra p h ic s , and b e tt e r fa cilities f o r p r o d u c i n g h ig h - q u a li ty local c o m m e r c i a l s . T h a t lead s to m o r e v ie w e rs , w h ic h in tu rn re a p s m o r e a d v e rtise rs, h i g h e r a d v e rtis in g rates, and m o r e p re s tig e. U n le s s the c o m p e t i n g s tatio n h as a larg e r e s e rv e fu n d o r a g o o d line o f c re d it w ith lo c al b a n k s , it m a y n e v e r re c o v e r. A s i m i la r e v e n t h a p p e n e d in the late

1 980s d u e to a n e w n e w s p a p e r ’s

s u b s c rip t io n -c o l le c t io n m e th o d s . T h e St. L o u is S u n — an u p sta rt, ta b lo id c o m p e t i ­ tor to the in c u m b e n t St. L o u is P o s t - D i s p a t c h — a tt e m p t e d to g e n e ra te s u b s c rib e r s u sin g a p a y - i n - a d v a n c e b illin g m e t h o d . It relied on n e w s s t a n d o r sin g le -c o p y sales te c h n i q u e s . U p to th en , St. L o u is r e s id e n ts pa id for the n e w s p a p e r afte r d e ­ liv ery , b u t T h e S u n ' s s i n g le -c o p y sales fell sh o rt o f e x p e c t a tio n s an d the p a p e r failed afte r 7 m o n t h s ( M u e lle r , 1997). M a r k e t B oundaries.

T h e Internet defies definition du e to its ability to carry

text, au dio , and video. A d v ertisers w a n t to k n o w w h o is re c e iv in g th eir m e s sa g e s an d how . T h e y ask: W h e n yo u view th e C a b le N e w s N e tw o rk ( C N N ) W e b site and read a story, are you w a tc h in g T V o r surfing the w e b ? If you find y o u r favorite radio sta tio n ’s W e b site, are you listening to radio, surfing the w e b , or bo th ? A s m e d ia t e c h n o l o g ie s c o n v e r g e , c o m p a n i e s e n te r m a r k e ts w ith g re a t e r ease a n d th e ir p r o d u c t s p ro v i d e a d e q u a t e s u b s titu te s f o r e a c h o th er. T h is e n c o u r a g e s m a r k e t b lu r rin g , j u s t as the d e v e l o p m e n t o f ra d io an d film i n c r e a s e d c o m p e t it io n for e n te r ta i n m e n t a n d the rise o f c ab le an d l o w - p o w e r T V s ta tio n s d e li v e re d the s a m e p r o d u c t as b r o a d c a s t sta tio n s ( P o w e rs , 1990). O n ly by d if fe re n tia tin g th eir p ro d u c ts can th e se m e d i a c reate m o r e d is tin c t m ark ets. R e v e n u e A l t e r n a ti v e s .

C o m p a n i e s try ing to w e a th e r e c o n o m i c d o w n tu r n s

o ften a tt e m p t to d iv e r s if y ; ne w te c h n o l o g ie s m a k e the d ec is io n s o m e w h a t e a sie r and m o r e a ttrac tiv e (e.g., K a n te r, 2 0 0 1 ). T h is c h a p te r d is c u s s e d the In te rn e t at leng th b e c a u s e it h a s so m a n y p o ss ib ilitie s an d the p o te n tia l fo r so m u c h im p act. F o r e x a m p l e , n e w s p a p e r s fo rm allia n c e s an d u se a d v e rtis in g s p o n s o rs a n d /o r s u b s c rip t io n s to g e n e ra t e r e v e n u e from th e ir W e b sites (P u ritz, 1996). A lth o u g h m a n y m e d i a c re a t e d a W e b p re s e n c e , th e re is d o u b t a b o u t the p o te n tia l to raise re v e n u e , e s p e c ia lly as an e le c tro n ic n e w s p a p e r ( C a m e r o n et al., 1997). M a n a g e r s k n o w h is to ry is littered w ith fin an cial te c h n o l o g ic a l failu re s, su ch as beta v id e o r e c o r d e rs and m a n y v id e o t e x t e x p e ri m e n t s . Y e t p o te n tia lly lu c r a tiv e v e n tu r e s exist. T h e future d e v e l o p m e n t o f d ig ital T V , w h ic h fe a tu re s p ic tu re s o f h i g h e r r e s o lu ti o n and c larity, a ll o w s the s i m u l ta n e o u s

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tra n sm issio n o f n ew s, sports, an d financial statistics an d so ftw are. T h e sale o f highdefinition T V s ( H D T V s ) will flourish as stations, n e tw o rk s , and p ro g r a m stu dios sw itch to the new d igital stan dard. S tations can air several add itio nal b ro ad ca s ts usin g the h ig h e r p ro d u c tio n stan dard, w h ich translates into m o re profits. In sho rt, the lim it o n r e v e n u e p o te n tia l o f ne w te c h n o l o g ie s is p rim a rily d e ­ p e n d e n t on the in n o v a tio n a n d b r a n d i n g a w a r e n e s s o f the m a n a g e r. In the m id1990s,

B la c k

E n te r t a in m e n t T e le v i s io n

enhanced

its b r a n d i n g

m issio n

of

b e c o m i n g “ the p r e e m i n e n t p r o v i d e r o f b la c k e n t e r t a i n m e n t ” b y ta k in g profits fro m its c a b lc T V b e g in n i n g s and p a rla y in g th e m into f o u r c a b le c h a n n e l s , an o n ­ line se rv ic e , a m a g a z in e , a m o n t h ly n e w s p a p e r in sert, an d a c h a in o f th e m e r e s ta u ra n ts. A lso w itn e s s the c ra f tin e s s o f the p e rs o n w h o b o u g h t v id e o fo o ta g e from British firm s w h o run su rv e illa n c e c a m e r a s (e.g., fire in s u ra n c e c o m p a n i e s , sec u rity firms, and v a rio u s g o v e r n m e n t a g e n c ie s). E x c e rp ts w e re e d ite d a n d c o m ­ p iled into a u th en tic, g ra p h ic scen es o f u n k n o w in g c o u p le s , cre atin g o n e o f the m o s t p o p u la r v id e o ta p e s in Britain. T h e m e s sa g e : T e c h n o lo g y e n h a n c e s profit. C o n s u m e r B eh a vio r.

N e w te c h n o l o g y c h a n g e s m e d i a c o n s u m p t i o n h a b its

an d b e h a v io r s . C o n s u m e r s c h a n g e d fro m r e a d i n g n e w s to w a tc h in g it w h e n T V w a s in tro d u c e d ( F u lle rto n , 1988). T h e W e b a ll o w e d c o n s u m e r s to in te ra c t w ith the site h o st o r the in f o rm a t io n by r e trie v in g an d s e n d i n g m e s s a g e s . B e fo re , the c o n s u m e r w a s s im p ly a p a s s iv e li s t e n e r /v i e w e r /r e a d e r o f in f o rm a tio n . N o w c o n ­ s u m e r s d o n ot h a v e to w a it until the e v e n in g n e w s c a s t f o r the c u rr e n t w e a t h e r or sh o r t-te rm fo rec ast. T h e y n e ed o n ly find the lo cal w e a th e r m a p on th e W e b or tu n e in to c ab le T V ’s W e a t h e r C h a n n e l. C a b le an d satellite te c h n o l o g y p ro v id e m o r e v ie w in g c h o ic e s so v ie w e r s b e c a m e m o r e s e le ctiv e in w h a t th e y w a tc h . T h e re s u lt is e v i d e n t in the ty p es o f c h a n n e l s a v a ila b le : H B O , C in e m a x , an d S h o w ­ tim e (fe a tu re film s); E S P N (s p o rts ); V H - 1 , T N N , an d M T V (m u s ic ) ; L ife t im e ( w o m e n ’s is su e s); D is n e y an d N ic k e lo d e o n ( c h i l d r e n ’s p r o g r a m m i n g ) ; an d P ayT V (s p e c ia l e v e n ts ), to n a m e a few . M edia

firm s

p a rtic u la rly

like

te c h n o l o g ic a l ly

encouraged

feedback.

A

C h ic a g o T V statio n p la c e d an u n m a n n e d c a m e r a in a k io s k at a n e a rb y s h o p p in g m all, a llo w in g c o n s u m e r s to c o m m e n t a b o u t a n y th in g the statio n p ro d u c e s . V ie w e rs can see t h e m s e l v e s d u rin g n e w s c a s t s o r on the s t a ti o n ’s W e b site. V ir t u ­ ally all n e w s p a p e r W e b sites p ro v id e e ith e r r e p o r te r s ’ o r e d i t o r s ’ e-m a il a d ­ d resses; s o m e p ro v id e o n lin e c h a t fo r u m s , w h e re read ers d is c u ss n e w s an d issues ( G u b m a n & G ree r, 1997). S u c h d e v ic e s are w o rk in g : A s u rv ey fo u n d In tern et use in c re a se d o v e r tim e a m o n g the s a m e g r o u p o f re s p o n d e n ts (L in d s tro m , 1997). A d v e r t i s i n g a n d P r o m o t i o n S t r a te g i e s , M e t h o d , a n d C o n te n t .

Rem em ber

the V C R ? V ie w e r s c o u ld fast fo r w a rd p a s t c o m m e r c i a l s in r e c o r d e d p r o g r a m s , in e ff e c t lo sing the a d ’s a u d ie n c e . T h is led s o m e a d v e rtis e rs to s w itc h to sho rter, m o r e c re a tiv e c o m m e r c i a ls to attrac t v i e w e r s ’ atte n tio n b e fo r e th ey d e c id e to fast f o r w a rd . D V D s h a v e e n h a n c e d this featu re.

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117

N e w t e c h n o l o g ie s fo r c e a d v e r t i s e r s ’ h a n d s , b u t also allo w th e m to be m o r e s e ­ lective a b o u t th e ir a u d ie n c e s . A d v e rti s e rs c o n s t a n tl y s e a r c h fo r n ew w a y s to ta r ­ g et specific a u d ie n c e s u sin g specific m e s s a g e s . M a n y te c h n o l o g ie s m a k e this easier. F o r in s ta n c e , p u s h te c h n o l o g y sen d s W e b c o n te n t to u s e r s ’ c o m p u t e r s , ra th e r th an u s e r s ’ ty p in g in W e b a d d r e s s e s t h e m s e l v e s , g iv in g u se r s w h a t they w a n t, w h e n th ey w a n t it. S im ila rly , the s u p e r V C R th r e a te n s to d e s tro y the c u r ­ ren t a d v e rtis in g m o d e l in the b r o a d c a s t in d u s try . T h e d e v ic e a ll o w s v ie w e rs to r e c o r d p r o g r a m m i n g as w ell as s earch and find the kin d o f b r o a d c a s t p r o g r a m s th ey like. T h is m a y d im in ish the n e t w o r k s ’ cap a b ility to e n su r e a n ew p r o g r a m ’s su c c e s s by p la c in g it in a p ri m e -t im e p eriod . S u c h s c h e d u lin g c re a te d artifices like s w e e p s m o n t h s , w h e n p a rtic u larly attractiv e p r o g r a m s are b r o a d c a s t to attract large a u d ie n c e s, in c re a sin g v ie w e rs h ip and a llo w in g n e tw o rk s to set ad v ertisin g rates. T h e s u p e r V C R th rea ten s th at entire trad ition al a p p ro a c h (L e w is, 2 0 00 ). A d v e r ti s in g on the W e b p r o v e d p ro b l e m a t ic fo r m a n y m e d ia . S o m e q u e stio n w h e th e r W e b ad s are as re c o g n i z a b le a n d m e m o r a b l e as p rin t ad v e rtisin g ( S u n d a r et al., 19 9 7 ). W e b a u d ie n c e m e a s u r e m e n t la ck s s t a n d a rd iz a tio n , m a k i n g a u d ie n c e m e a s u r e m e n t an d thu s a ttractin g a d v e rtis e rs m o r e difficult. O n the positiv e side, b e cau se o f the In te rn et’s in h eren t ta rgeting efficiencies, pro d u cers o f so m e specialized sites tried to create classified adv ertising nich es (e.g., in car buy in g and selling, real estate listings o r e m p l o y m e n t services, or to use e x ­ isting b ran d s and spin th e m o f f into sites o f their o w n ; N e w m a n , 2002). O th ers such as the regional Bell o p era ting c o m p a n ie s also h a v e or plan sim ilar v ehicles to siphon o ff part o f the local a dv ertisin g market. A key driving force is national a d ­ vertisers intent on re aching g e o g rap h ically targeted au d ien c es using tech n o lo g y fil­ ters th at c o m p e n s a te fo r the lack o f fo cu s e d co n ten t to b uy (C h y i & S y lv ie, 1998).

SUMMARY T o s u m m a r i z e , te c h n o l o g y has in te rn a l and e x te r n a l im p a c ts . M a n a g e r s h a v e to u n d e rs ta n d th a t t e c h n o l o g y d e m a n d s a d ju s tm e n t. T h e y m u s t be s e n s itiv e as to h o w an d w h e n to m a n a g e . A m e d ia m a n a g e r ’s j o b is to tu rn th e te c h n o l o g y to the c o m p a n y ’s a d v a n ta g e . T h is c h a p te r e x a m i n e d m a n a g e r ia l a p p r o a c h e s to te c h n o l ­ o gy , the p ro c e s s o f h o w a c o m p a n y u se s o r a d o p ts te c h n o l o g y , an d h o w te c h n o l ­ o g y m a y a ff e c t m e d i a o rg a n i z a ti o n s an d th eir m a r k e ts. T h e stru c tu r a l, t e c h n o l o g ic a l - t a s k , and s o c i o te c h n i c a l a p p r o a c h e s are each r o o te d in a sligh tly d if fe re n t m a n a g e r ia l o rie n ta tio n . E a c h h a s its a d v a n ta g e s and d is a d v a n ta g e s . M o s t m o d e r n - d a y m a n a g e r s u se s o m e form o f the so c io te c h n ic a l a p p ro a c h . A m e d i a c o m p a n y a d o p ts a te c h n o l o g y fo r its o w n p a rtic u la r re a s o n s. T h e n it in tro d u c e s the te c h n o l o g y to e m p l o y e e s , w h o in te ra c t in v a rio u s w a y s w ith the te c h n o l o g y d e p e n d in g o n the e m p l o y e e an d n a tu r e o f the task in v o lv e d . T h e n m a n a g e m e n t p e r c e p t io n s a n d e m p l o y e e re a c tio n s p r o m p t a p e rio d o f a d ­ ju s t m e n t , u ltim a te ly le a d in g to a d o p tio n o r r e je c tio n o f th e te c h n o lo g y .

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CHAP T E R 5

FIG. 5.3.

H ow technology affects media managers.

A s a result, the te c h n o l o g y affe c ts m a n a g e ria l f u n c t io n s , in c l u d in g p la n n in g , o rg a n i z in g , staffing, m o t iv a t in g , a n d c o n tr o ll in g o p e r a t io n s (s e e Fig. 5.3). O v e r ­ all te c h n o l o g y c a u s e s a m e d i a m a n a g e r to m a n a g e in an a t m o s p h e r e o f c o n s t a n t c h a n g e an d a d ju s tm e n t. H o w an d w h e n a m a n a g e r acts h a s g re a t im p a c t on the c o m p a n y ’s future.

Case 5.1 Convergence Blues

A s e x e c u tiv e editor, Jo e C h e v a li e r runs the n e w s ro o m o f T h e D a ily G r i n d , the lone n e w s p a p e r (circulation 7 5 ,0 0 0 ) in M a tlo c k , a tow n o f a b o u t 2 00 ,00 0. The G r in d h as ju s t jo i n e d a ven tu re w ith local T V station W O O O to c ro s s -p ro m o te each o t h e r ’s n e w s p rod uct. It is the first day th at Jo e will go live on W O O O ’s 5 p.m . n e w sc a st w ith a repo rt on the c it y ’s light rail r e f e re n d u m . Earlier, Jo e w ro te a light rail story for the n ex t m o r n i n g ’s G r in d and G rin d O n lin e , the p a p e r ’s W e b site, but W O O O p ro d u c e rs a sk ed Joe to p ro v id e insights in a short, o n -a ir c hat w ith a n c h o r ­ m a n Pete L o o n e y . A fte r the d is c u ssio n , L o o n e y re m in d s the a u d ie n c e to lo ok for J o e ’s story “ in t o m o r r o w ’s D a ily G r in d and e-m ail Jo e and let him k n o w w h a t you th in k .” Joe forgets to tell L o o n e y that to m o rro w Jo e starts his vacation. A w e e k later, Jo e c a m e b a c k to w o rk w ith a feeling o f fo r e b o d in g . H e k n e w he w o u ld h a v e to n s o f e -m a il m e s s a g e s to d e a l w ith — s o m e h a rs h ly , s o m e d ip l o m a t ic a l ly , o th e r s q u ic k ly . A f te r a q u ic k , s h o c k e d lo o k at the m e s s a g e s , Jo e left his c o m p u t e r to see h o w the n e w v e n tu r e h a d p ro g r e sse d .

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119

C irc u la tio n an d ra tin g s re p o r ts s u g g e s t a sm all b o u n c e in atte n tio n fo r the v en tu re . W O O O ’s ra tin g s are u p a b o u t 0 .9 % c o m p a r e d w ith a y e a r ag o, w h ile its 10 p .m . n e w s c a s t c o n ti n u e s to ru n s e c o n d . T h e G r i n d ’s daily c ir c u la tio n ro se a b o u t 0 .5 % o v e r the w e e k (to 7 5 ,4 5 6 ), an d S u n d a y c ir c u la tio n d r o p p e d from 1 5 0 ,0 7 4 to 149,68 7. A t G r in d O n lin e , m e a n w h il e , p a g e v ie w s w e re up 10% c o m ­ p a re d w ith last m o n th . Jo e w a s m o r e c o n c e r n e d a b o u t w h a t h e h e a rd . D o r o th y D o d s o n , the c o p y c h ie f, said c o p y e d ito rs w o r k in g o n the floor rig ht o v e r the T V n e w s r o o m “h a v e h ad to go o u t a n d b u y s o m e d a m n e a r p l u g s ! ” R a y m o n d T r a h a n , a 1 0 -y c ar v e t ­ e ran at W O O O b e fo r e he sta rte d at T h e G r i n d 3 y e a rs ag o, is r e s p o n s ib l e for lo ca tin g to p ics th a t w o rk on T V , o n lin e , and in the p a p er. H e also h a s to p e r ­ s u ad e e v e r y o n e to w o rk to g e th e r. “ I t ’s like h e rd i n g c a ts , ” T r a h a n told Jo e. “ I feel like the m a n a g e r o f the C u b s try in g to c o a x all m y r i g h t- h a n d e d b a tte rs to s w itc h -h it. T h e y j u s t w a n t to p lay th e ir g a m e and g e t p a id .” L o o n e y also h a d c o m p l a i n e d to T r a h a n th at G r i n d re p o r te rs “ l o o k e d like hell. B lue je a n s an d ties w ith k e tc h u p stain s d o n ’t lo o k all that g o o d ” on c a m e ra . T o b o o t, T r a h a n h a d h a d to r e m in d se v e ra l re p o r te rs to e x p e c t an d p lan for o n -a ir shifts, a s w ell as h a v e tw o se rio u s c o n v e r s a ti o n s w ith M c C o y M e t o y e r, L o o n e y ’s b oss an d W O O O n e w s d ire c to r, to “ g iv e m o r e a tte n tio n to the p ro j e c t.” F in a lly , G rin d O n lin e w a s lo b b y i n g T r a h a n fo r m o r e c o p y as w ell, e sp e c ia lly v id e o . Y et o n lin e c o n te n t e d ito r A m e l i a L a C o u r p riv a te ly c o n fid e d to T r a h a n that, “T h is p a c e is k illin g us; m y s t a f f ’s a s k in g h o w m u c h e x tr a t h e y ’re g o in g to g et paid an d I k e e p stallin g t h e m . ” M e a n w h i l e J o e ’s e -m a il tally h a d r e a c h e d 2 5 7 , m u c h o f it fr o m stran gers. T h a t total is a b o u t six ti m e s w h a t he n o rm a ll y r e c e i v e s in a da y. Jo e w a n te d to h e a r fr o m e v e r y b o d y in his n e w s r o o m a n d W O O O ’s, as w ell as fr o m the c o m ­ m u n i ty a b o u t the n e w v en tu re . H e is g la d the p u b lic has a h u n g e r for g re a t e r c o n ­ ta c t to jo u r n a li s ts , b u t he is n ot h a p p y a b o u t the w a y th in g s are w o r k in g o u t w ith W O O O . H is p u b lis h e r, L a c a d ia S e v c ri n , w a n ts a p r o g r e s s r e p o r t in 2 days.

A S S IG N M E N T 1. In w h a t sta g e o f the c o n v e r g e n c e a d o p ti o n p ro c e s s is T h e G r i n d ? E -m a il a d o p ti o n ? B a s e d on y o u r in te rp re ta tio n o f J o e ’s fe e lin g s, at w h ic h stag e for e a ch d o e s Jo e w a n t to r e tu rn ? W h ic h a p p r o a c h to a d o p tio n d o e s J o e seem to e m b o d y o n e a c h te c h n o l o g y ? 2. W h a t m a n a g e m e n t c h a n g e s is J o e e x p e r i e n c in g o r likely to e x p e r i e n c e ? W h a t fu n c tio n a l a d ju s tm e n ts w ill Jo e h a v e to m a k e ? 3. R e s e a r c h c o n v e r g e n c e a n d d e v e lo p a list o f a lte rn a tiv e s fo r J o e to c o n ­ sider. W h a t n e w r e v e n u e s t re a m s m i g h t be c r e a te d in the p ro c e s s ? 4. W h a t can Joe do to i m p ro v e the jo u r n a lis tic q u ality o f T he G r in d and s i m u l ­ ta n e o u s ly m a k e the n e w s m o r e m a r k e ta b l e fo r G rin d O n lin e an d W O O O ? 5. W h a t s h o u l d Jo e d o a b o u t his e - m a il d il e m m a ?

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CHAP T E R 5

Case 5.2 The Case of the Technology of Choice

You

are the n e w s d irecto r o f K P U N , a s m a ll -m a r k e t (7 5 ,0 0 0 h o u se h o ld s),

netw ork-affiliated T V station. Y o u r three rivals— K O N E , K F U N , and K T U N — have 2 5 % , 2 2 % , and 29% o f the overall view ership, respectively, leaving you with 24% . F o r ye ars , K P U N w a s k n o w n as the h a rd - h ittin g , n e w s - o r i e n te d sta tion , with o c c a s i o n a l to p - n o tc h in v e s tig a tiv e p ie c e s, p o p u la r a n c h o rs , an d a g o o d sp o rts staff. Y o u r v ie w e r s ten d to be sligh tly m o r e e d u c a t e d than a v e ra g e . K O N E , y o u r n e a re s t c o m p e t it o r , airs m o r e tab lo id - lik e p ie c e s , e m o t io n a l te a r je r k e r sto ries, and

se n s a tio n a l

“ g o t c h a ” j o u r n a li s m .

M e a n w h il e ,

KFUN

and

KTUN

tak e

m id d le -o f-th e -ro a d a p p ro a c h e s in n ew s, but feature o u tsta n d in g w e a th e r cov erag e. K T U N ’s e d g e is its hig hly p o p u la r an ch o rs , w h o d o a lot o f c o m m u n it y p r o m o ­ tio n al w o rk w h ile e m p h a s iz i n g n atio n a l an d in te rn a tio n a l n e w s on the air. K F U N o p ts fo r a b a la n c e in local, n atio n a l, an d in te rn a tio n a l n e w s , b ut m a k e s u p fo r it by h e a v ily p r o m o t i n g its total p a c k a g e . E a c h station has a W e b p r e s e n c e , m a in ly as p ro m o ti o n a l v eh ic le s for o n -a ir c o n te n t o r as m e c h a n is m s to give v ie w e rs a d d i ­ tional, n o n sta tio n -g e n e ra te d in fo rm a tio n . T h e sites ty p ic ally c o n ta in the w e a th e r rep orts an d rad ar (u p d a te d h o u rly ) as w ell as ea ch story (in tex t form ) fro m that d a y ’s n e w sc a sts. T h e o n ly o th e r visu als are m a p s , charts, an d still ph o to s. Y o u r station G M j u s t in f o r m e d yo u th a t y o u r b u d g e t w o u ld in c r e a se 8% o v e r this y e ar. Y o u e x p e c t it to in c r e a s e a g ain the f o l lo w in g year. A b o u t tw o th ird s o f a n y in c r e a se y o u r e c e iv e w ill be u se d to u p g r a d e e q u i p m e n t a n d /o r facilities, but a m a n d a t e c o m e s w ith the ex tr a m o n e y . T h e G M w a n ts an in c r e a s e to s e c o n d or e v e n first p la c e in the ra tin g s g iv e n the c lo s e n e s s o f the c o m p e t it io n . Y o u reply that an 8% b u d g e t in c r e a s e is n o t m u c h to go o n, b u t she say s it is c o m p a r a b l e to w h a t c o m p e t i n g local n e w s r o o m s are gettin g . W h il e r e v e n u e s h a v e g r o w n , co sts h a v e k e p t p ace , so th ere is no h o p e o f h irin g a d d itio n a l jo u r n a li s ts . Y o u m u s t use c u r r e n t e m p l o y e e s m o r e effic ien tly to p r o d u c e s o m e th i n g d is tin c tiv e tha t will put y o u at o r n e a r th e top. Y o u d e c id e to sh o p fo r a n e w n e w s r o o m sy s te m . A f te r re a d in g in d u s try p u b l i ­ c a tio n s an d g iv i n g th e situ atio n m u c h th o u g h t , y o u n a rr o w y o u r c h o ic e s to the fo llo w in g : 1. A w ire serv ice p ro d u c tio n sy s tem : • A d r a g - a n d - d r o p in t e r f a c e th a t m o st likely will be a d o p t e d by m a j o r U.S. TV o r g a n i z a t i o n s b y m id -y e a r . It u se s a briefin g b u tto n to re trie v e i n f o r ­ m a tio n . T h e r e p o r te r ty p e s in o r h ig h lig h ts a w o rd an d in s ta n tly a c c e s s e s a c a ta lo g u e o f related m aterial, in c lu d in g w ire stories, p ictures, so un d clips, an d m ap s. It also can retrieve th u m b n a il v ideo im a g e s and feature links to p la y b a c k and m a c h in e co ntrol for ro bo tic c a m e ra s, still stores, p ro m p te rs , c h a ra c te r g ene rato rs, an d c a p tio n in g sy s tem s . T ra in in g on in ­ stallations has b een su rp rising ly sim p le, v e n d o rs say. T h e sy stem can be

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in teg rated w ith the w ire s e r v ic e ’s total N e w s F o c u s p ro du ct. T h e y early fee o f N e w s F o c u s is b ased on m a r k e t size, w h ic h is a b o u t $ 9 ,0 0 0 fo r K P U N . 2. A m u ltita s k , s ta n d - a lo n e sy s te m : • A p r o d u c t th a t touts itse lf a s a “ lens to t r a n s m i t t e r ” te c h n o lo g y , a l ­ t h o u g h still n ot h ig h ly a d o p t e d by o th e r sta tio n s . T h e s y s te m is d e s i g n e d to h a n d le te x t c o m p o s it io n , a u d io an d v id e o b ro w s i n g , an d W e b p u b l i s h ­ ing. A s n e w s fee d s c o m e in, the s y s te m sto res th e m in lo w re s o lu tio n on a s e r v e r an d in full r e s o lu tio n o n tape. T h e u s e r ca n th en b r o w s e the lo w r e s o lu tio n v id e o an d c o m p o s e an ed it d e c is io n list th at he can th e n use in a ta p e - to - ta p e suite. W it h w o rk s t a tio n , s e r v e r so f tw a re , an d b r o w s e s e rv er, p ric e can v a ry fr o m $ 2 5 ,0 0 0 to $ 1 0 0 , 0 0 0 d e p e n d i n g o n w h a t the c u s t o m e r w a n ts to a c c o m p lis h . 3. A p o w e r f u l u p g r a d e o f a sy ste m K P U N a lr e a d y has: • T his sy stem u se s a d a t a b a s e to t r a c k s crip ts , e -m a il, w ire s , a n d a r c h i v a l d a t a ; a ll o w s d ir e c t a c c e s s to I n t e r n e t file e x c h a n g e ; a n d is the next g e n ­ e r a t i o n o f a p o p u l a r sy stem u se d n a ti o n w i d e . It will n o t ed it v id e o , b ut a ll o w s the u se r to v ie w v id e o sto red on the v id e o s e r v e r and a d ju s t the start an d e n d p o in t s f o r p la y b a c k , w h ic h c o m e s in h a n d y fo r q u ic k cuts. T h is s y s te m can be in te rfa c e d w ith a lm o s t an y o t h e r sy s te m . T h e c ore s o f tw a re co sts a b o u t $ 1 5 0 p e r w o r k s t a tio n se at fo r th e s e r v e rs an d $ 4 0 0 p e r se a t fo r the d a ta b a s e so f tw a re ; the so f tw a re c o sts a b o u t $ 4 ,0 0 0 . T h e sea t p rices are e x p e c t e d to fall after the first 10 or 15 clien ts. 4. A n u p g r a d e o f a j o u r n a li s t w o rk s t a tio n p ro d u ct: • T his p r o d u c t h a s a n a d d i t i o n a l W eb p u b li s h e r a p p l i c a t i o n a n d a b a c k u p s e r v e r; it is m a d e by a c o m p a n y with a g o o d r e p u t a t i o n a n d th a t offers a n in t e g r a t e d system , o f w h ic h this p r o d u c t is a p a r t . T h e s e r v e r a llo w s re p o r te rs to p e r f o r m c u ts -o n ly e d itin g an d fe a tu re s an u n d e r m o n i t o r d i s ­ p la y tha t s h o w s the sto ry slug an d the p i e c e ’s r u n n i n g tim e. T h e v e n d o r sells the sy s te m as a p a c k a g e w ith its lo cal area n e tw o r k b r o w s e r, w h ich c o n v e r t s fin ish ed v id e o clip s to lo w -r e s o lu tio n files an d m a k e s th em av a ila b le to an y n o n c d it in g s tatio n (i n c lu d i n g p r o d u c e r s a n d n e w s d i r e c ­ to rs) on the n e tw o rk . A fo u r - c h a n n e l m o d e l co sts a b o u t $ 1 0 0 ,0 0 0 , and the w o rk s t a tio n s run $ 2 0 , 0 0 0 apie c e.

A S S IG N M E N T 1. C h o o s e o n e o f the fo u r o p ti o n s a n d m a k e a c o n v in c i n g c a se for it to the G M . W h y w o u ld the o p tio n y o u c h o o s e be a b e tte r alte rn a tiv e than the o th e r o p tio n s ? 2. W h ic h t e c h n o l o g y w o u ld m o s t h e lp K P U N v a u lt into the lo cal ra tin g s le ad ? W h i c h w o u ld be least likely to h e lp ? W h y ?

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3. D e v e lo p a p ro je c te d b u d g e t o f the p rio r o p ti o n s an d the p o s s ib le s p i n - o f f c o sts th ey m a y p ro m p t. D o a c o s t s - b e n e f i t s a n a ly s is c h a r t an d p r e s e n t the find ing s to the clas s, w h ic h w ill act as y o u r G M . 4. S h o u ld a s m a ll T V s tatio n b o th e r to u p g r a d e its W e b p re s e n c e ? Is it co ste f f e c tiv e g iv en c o m p u t e r a d o p ti o n rates in s m a ll m a r k e ts ? S h o u ld c o m p e ­ tition d riv e or d ir e c t tha t e n tr y ? W h a t are the a d o p tio n ra m ific a tio n s o f c re a tin g an in te ra c tiv e W e b p a g e fo r a T V sta tio n ? W o u l d it be an i m ­ p r o v e m e n t o v e r the f o u r o p ti o n s a lr e a d y u n d e r c o n s i d e r a t io n ? H o w w o u ld it c h a n g e a n e w s d i r e c t o r ’s j o b ? W h a t k in d s o f W e b site se rv ic e s a n d /o r c o n te n t w o u ld e n a b le K P U N to se t its e lf a p a rt fr o m c o m p e t it o r s ?

Case 5.3 Problems in PR

T h e M a r k V. L o o n e y C e n t e r fo r E d u c a ti o n ( L C E ) face s a p ro b l e m f o u n d acro s s the c o u n tr y : h o w to in te g ra te c o n s t a n tl y a d v a n c i n g te c h n o l o g y an d e le c tro n ic c o m m u n i c a t i o n into its n e w s a nd in f o r m a t io n s e r v ic e re s p o n s ib ilitie s . T h e L C E first w e n t o n lin e a few y e a rs a g o , b u t its site w a s r u d i m e n t a r y at best b e c a u s e its t w o - h e a d e d m i s s i o n — to h e lp im p r o v e r e a d i n g a n d l a n g u a g e arts p e r f o r m a n c e in th e s t a t e ’s p u b lic s c h o o l s — m a d e c o m m u n i c a t i o n difficult. G ig B y te, the L C E ’s c o m m u n i c a t i o n s c o m p u t e r s y s te m s a d m i n is tra t o r, w a s ta le n te d , W e b s a v v y , and h ig h ly e n e rg e tic . H o w e v e r , he w a s c o n s t a n tl y at h is w its end in tr y in g to g e t the c e n t e r ’s in te rn a l d e p a r t m e n t s to c o o r d i n a te th e ir sites. T h e L C E starte d 15 y e a rs a g o t h a n k s to a h u g e g r a n t fro m the L o o n e y fa m ily . T h e L C E u se d the g ra n t (an d o th e r s fr o m p riv a te a n d p u b lic f u n d e r s ) to a c h ie v e its m i s s i o n . H o w e v e r , o r g a n i z a ti o n a ll y , the L C E w a s a bit ch a o tic . It w a s sta ffed by f o u r d iv isio n s: (a) a re s e a rc h g ro u p th a t f o c u s e d on th e o r e tic a l and p ra ctica l issues in re a d in g and l a n g u a g e arts; (b) a l a n g u a g e arts g r o u p th at c o n d u c te d c o n s u ltin g an d s e m in a r s a c ro s s the state fo r s c h o o ls an d s c h o o l districts; (c) a p ro d u c t d iv is io n th a t d e v e lo p e d r e a d in g a n d l a n g u a g e a rts-rc la tc d m a te ria ls (p o s ters , in s tru c tio n a l kits, h a n d b o o k s , etc.) fo r te a c h e rs ; an d (d) a c o m m u n i c a ­ tions d iv is io n th a t m a i n ta i n e d eac h d i v i s i o n ’s W e b sites, as w ell as p ro d u c i n g L C E p u b li c a ti o n s su c h as an o rg a n i z a ti o n a l n e w s le t te r an d h a n d li n g L C E p u b lic r elatio n s. All d iv is io n s w e re o v e rs e e n b y the L C E d i r e c t o r ’s office, h e a d e d by M a g n e y T i s m , a w e l l - k n o w n s c h o l a r an d e n tr e p re n e u ri a l th i n k e r in re a d in g and l a n g u a g e arts w h o left the d a y - t o - d a y o p e r a t io n s to h e r a ss o c ia te , C h a im A b le. T h e c e n te r is an affiliated th ink tank o f a local un iversity . L C E ’s fu n d in g h is ­ tory an d visio n are such th at e a c h d iv isio n , w ith the e x c e p tio n o f c o m m u n ic a t io n s , o p e ra te d s o m e w h a t a u to n o m o u s l y , c o m i n g t o g e t h e r on ly at the b e h e s t o f T ism , w h o s e e m s to e m b o d y the c e n t e r ’s m issio n and is, fo r all effects, its soul. B y te is the n e w e s t staffer; he w o rk s fo r c o m m u n ic a t io n s h e a d C h a y n e Ja g e n t, w h o has

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the u n e n v ia b le task o f try ing to k e e p track o f w h a t e a c h d iv isio n d o e s w h ile h a v ­ ing no a u th o rity o v e r the div isio n s. C h a y n e is o ften fr u strated th a t C h a im w ill not tack le the L C E ’s d is o rg a n iz a tio n w o e s headfirst, c h o o s in g in ste ad to c o n c e n tra te on p o licy m a tte rs and rela tio n sh ip s w ith c u rr e n t a n d p o ss ib le fu n d ers. C h a y n e is e s p ec ially u p set b e c a u s e the la ck o f o rg a n iz a tio n m a k e s his j o b m o r e difficult. G ig is fee ling C h a y n e ’s p ain . G ig often lo o k s at the c e n t e r ’s W e b site and s e e s d is a rra y . E a c h d iv isio n h a s its o w n W e b s ta ffer w h o p ro d u c e s c o n te n t. G ig h a s tried to w o rk w ith th e s e staffers, b u t h as b e e n u n s u c c e s s f u l in g e ttin g th e m to a d o p t a c o m m o n v is io n and a p p r o a c h . E a c h d iv is io n site u ses d if fe re n t g ra p h ic s , o rg a n i z a ti o n a l styles, a n d w ritin g styles, m a k i n g e a c h site u n iq u e ; th e ir o n ly c o m m o n th r e a d is that th ey all link to the m a i n L C E site, m a i n ta i n e d in m o d e r n , e fficien t fa s h io n by G ig . Still G ig o nly h as s e c o n d - h a n d in f o rm a t io n a b o u t w h a t g o e s on in th o s e d iv is io n s , o ften fin ding th in g s o u t th r o u g h the n e w s le t te r , w h ich is p r o d u c e d by fello w c o m m u n i c a t i o n s s taffer H a c k R ider. F a ilu re to un ify all sites h u rts L C E ’s r e p u ta tio n an d im p e d e s its ability to d i s ­ s e m in a t e a c o n s i s te n t im a g e . S e v e ra l c o m p u t e r p ro b l e m s h a v e a risen , in c lu d in g s e r v e r b a c k u p an d p r o b l e m s w h e re th e n e tw o r k h a d to b e tak en d o w n . U su ally G ig f o u n d a q u ic k b u t te m p o r a r y so lu tio n . In th e last 2 y e a rs , the o ffice sp en t a b o u t $ 2 0 ,0 0 0 fo r n ew c o m p u t e r s , p rin ters, so f tw a re , an d w irin g . H o w e v e r , o n ly $ 2 ,0 0 0 is b u d g e te d fo r te c h n ic a l s u p p o r t th is y e ar, and a s y s te m s a n a ly s t line item w a s p e r m a n e n tl y d e le te d fro m the c e n t e r ’s b u d g e t. L a st w e e k , M a g n e y e s ta b lis h e d an ad h o c W e b te a m c o m p r is e d o f b u d g e t h ead D oll A rs, C h a i m , G ig , C h a y n e , a n d the h e a d o f th e o th e r d iv isio n s. M a g n e y is m iffe d that the L C E ’s i m a g e is re la tiv e ly u n k n o w n o u ts id e o f the u n iv e r sity , te a c h e rs , a n d p rin c ip a ls. “W e d o n ’t g e t o u r d u e ,” M a g n e y said. “T h e W e b site n e e d s a n o v e rh a u l. I w a n t to see us an d the s t u ff w e do o n the n e w s . ” N o o n e in the L C E h a s fo r m a l p u b lic r e la tio n s train in g. T h e c e n t e r ’s o rig in a l h o m e p a g e did n o t in c lu d e a r e v is e d m i s s i o n s t a te m e n t fo r the office, a lt h o u g h o n e h a s b een in the d e v e l o p m e n t sta g e sin ce the c e n te r c h a n g e d its n a m e 3 y e a r s ag o. T h e site c o n ta i n s no in f o rm a tio n a b o u t the L C E ’s m i s s i o n o r g o als , n o r an y e x p la n a tio n as to h o w its d iv is io n s w o rk . T h e r e is no li nk fo r the g e n e r a l p u b lic , m u c h less fo r the n e w s m e d i a . T h e c e n te r s e n d s all its re le a s e s th r o u g h the u n i v e r s i t y ’s o v e r w o r k e d and u n d e rs ta ff e d p u b lic rela tio n s office, w h ic h ra re ly , if at all, to uts the c e n te r on the u n iv e r s it y ’s m ain W e b site. Y o u — a fa c u lty m e m b e r o f the u n iv e r s it y ’s m a n a g e m e n t d e p a r t m e n t — h a v e b e e n a s k e d to serv e as a c o n s u l ta n t to h elp s o l v e the p ro b le m .

A S S IG N M E N T 1. W h a t kind o f strategic planning should the cen ter do in regard to this pro b lem ? 2. W h a t s h o u ld b e d o n e a b o u t the a g e n c y ’s o n lin e p r e s e n c e ? S h o u ld it c o n ­ tin u e o r be te r m i n a te d ? W h y or w h y no t?

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3. S h o u ld the ad hoc te am be restructured ? S ho uld the team be resp on sib le fo r the s ite ’s con stru ctio n and conten t? W h o should be resp on sible fo r u p ­ dating and m ain tainin g the site? 4. H o w can the ag en cy m a k e the best use o f its cu rren t reso urces in solving this p ro b le m ? W h a t sho uld be red o n e to rebuild staff c on fid ence in the site and in its on lin e capab ilities? H o w im p ortan t is the a g e n c y ’s m ission to the W e b site d ev e lo p m e n t?

C H A P T E R

6 R and

S

e g u l a t io n elf

-R

e g u l a t io n

L aw s affecting the m ed ia c hang e constantly. T his chap ter dis cusses how laws affecting m edia firms have chan ged and instances w hen legal advice should be sought. The best, m ost basic w ay to m an ag e legal issues is to u nderstand the laws. L aw s m ore pertinent to m edia m a n a g e m e n t are introduced. T h e goal o f this c h a p ­ ter is to outline a few ex am p le s o f practices and principles that all m edia m a n ­ agers must apply to avoid legal problem s. S o m e online resources are identified. T his ch ap te r is not intended to be a c o m p re h e n siv e discussion o f all areas o f law that m ight affect m ed ia firms. H o w e v e r, it highlights a few areas o f c o n te m ­ porary interest and focuses on the prevention and response to legal actions. R e ad ­ ers interested in a specific legal area (e.g., libel, privacy, etc.) should review the appropriate legal resources (such as the 2 002 A P Slylebook a n d B riefing on M ed ia L a w [G oldstein, 2002], M a s s C o m m u n ic a tio n L a w in a N u tsh ell [Carter, D ee, & Z u c k m a n , 2000], First A m e n d m e n t L a w in a N u tsh ell [Barron & D ienes, 2000], Internet Law f o r the B u sin ess L a w y e r [Reiter, B lum enfeld, & B oulding, 2001], Intellectual P ro p erty a n d U nfair C om petition in a N utshell [M cM anis, 2000], I n ­ tellectual P roperty-P atents, Tradem arks, a n d C op yrig h t in a N utshe ll [M iller & D avis, 2000], and M a s s C o m m u n ica tio n L aw : C ases a n d C o m m e n t [G illm or, B arron, & Sim on, 19981.

THE C H A N G IN G NATURE OF LAWS AFFECTING THE M E D IA M e d ia m a n a g e rs m u s t ex pect th at the m e dia industry la nd scap e will ch an g e d ra ­ m atically and regularly in the future. T h e y will m a k e d ec ision s pitting the b u si­ ness interests o f their o w n e rs ag ainst the public interest. R ece n t even ts d e m o n s tra te ho w laws, rules, and regu lation s affectin g the m e d ia ch a n g e often. F or e x a m p le , the T e le c o m m u n ic a tio n s A ct o f 1996 c h a n g e d the bro adcast, cable, and telep ho ny industries by elim in atin g o r ch an g in g radio and TV station o w n e rsh ip limits, e x tend in g b ro ad cas t license term s, sim plifyin g the license 125

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r e n e w a l p ro c e s s , d e re g u l a ti n g c a b le rates, a n d in c r e a s in g fines fo r o b s c e n ity . By 1997, the S u p r e m e C o u r t s tru ck d o w n a p ro v is io n o f the T e l e c o m m u n i c a t i o n s A ct. T h e C o m m u n i c a t i o n s D e c e n c y A c t o f 1996 h a d im p o s e d c ri m i n a l p e n a ltie s fo r tr a n s m ittin g in d e c e n t o r p ate n tly o f f e n s iv e m a te ria l o v e r c o m p u t e r n e tw o rk s to m i n o r s (C h ild s , 1997; M a u r o , 1997). S e c tio n 2 0 2 (h ) o f the T e l e c o m m u n i c a t i o n s A c t o f 1996 r e q u ire s the F e d e ra l C o m m u n i c a t i o n s C o m m i s s i o n ( F C C ) to re v ie w its m e d i a o w n e r s h i p rules e v e ry 2 y e a rs ( w w w . f c c . g o v / m b / p o l i c y / o w n . h t m l ). (A n o u tlin e o f e x is tin g ru le s can be f o u n d at the F C C ’s W e b site [w w w . f c c . g o v / o w n e r s h i p ] a n d the M e d i a A c c e s s P r o j e c t ’s

W eb

site

[w w w . m e c i i a a c c e s s .o r g / p r o g r a m s / d iv e r s it y ].)

O w n e r s h ip

ru les are a m a j o r in d u s try c o n c e r n b e c a u s e r e l a x in g th em w o u ld allo w m e d i a c o m p a n i e s to b u y a v a rie ty o f m e d i a o u tle ts an d g ain e c o n o m i e s o f scale in n e w s o p e ra t io n s , fo r e x a m p l e . Y e t h a v in g a lim ite d n u m b e r o f m e d i a o w n e r s c o u ld r e ­ su lt in too few c o m p a n i e s c o n tr o ll in g the flow o f in f o r m a t io n , in c lu d in g n e w s an d e n te r ta i n m e n t , th us h a m p e r i n g the ro b u s t m a r k e tp l a c e o f id eas (H ic k e y ,

2 0 0 2 ). T h e o w n e r s h i p rule s “h a v e b een at the c e n te r o f a legal an d political fire s to rm ” ( D r e a z e n , 2 0 0 2 , p. A 2 ). T h e F C C is u n d e r t a k in g a w i d e - r a n g in g r e ­ v ie w o f th e m a j o r o w n e r s h i p ru les in c lu d in g : (a) the T V o w n e r s h i p lim it, w h e r e b y o n e b r o a d c a s t e r ’s statio n s c a n n o t r e a c h m o r e th an 35 % o f U .S . v ie w e rs ; (b) the T V d u o p o ly rule, w h ic h lim its the n u m b e r o f sta tio n s a c o m p a n y can o w n in th e s a m e m a r k e t; (c) the c ro s s - o w n e r s h i p rules, w h ic h lim its o w n e r s h i p o f ra d io an d T V sta tio n s, as w ell as n e w s p a p e r s and T V statio ns in a sin g le m a r k e t; an d (d) the d u a l- n e tw o r k rule, w h ic h p ro h ib its c o m p a n i e s fr o m o w n in g m o r e th an o n e o f the f o u r m a j o r n e tw o r k s (D r e a z e n , 2 0 0 2 ; H a lo n e n , 2 0 0 2 a , 2 0 0 2 b ). T h e S u p r e m e C o u r t ru le d in A s s o c i a t e d P r e s s v. U.S. ( 1 9 4 5 ) th a t th e w id e s t p o s s ib le d i s s e m i n a ti o n o f in f o r m a t io n fro m d iv e r s e an d o p p o s i n g s o u r c e s w a s c e n tra l to p ub lic w e lfa r e . H ic k e y ( 2 0 0 2 ) said if m e d i a o w n e r s h i p rules arc e l i m i ­ n ated o r r e la x e d fu rth e r, f e w e r c o m p a n i e s c o u ld c o n tr o l the c o n t e n t o f n e w s and e n te r ta i n m e n t p ro g r a m m i n g . T h e M e d i a A c c e s s P ro j e c t ( w w w . m e d i a a c c e s s . o r g ) ide ntified the re s u lts o f ra d io c o n s o l id a t io n afte r the p a s s a g e o f the T e l e c o m m u ­ n ic a tio n s A c t o f 1996. T h e n u m b e r o f ra d io o w n e r s d e c li n e d 2 5 % b y 2 0 0 1 . In 1996, W e s t i n g h o u s e o w n e d 85 s ta tio n s an d w a s the la r g e s t ra d io o w n e r. By 2 0 0 1 , C le a r C h a n n e l w a s th e la rg e st o w n e r w ith a b o u t 1,200 statio ns. In a few ye ars , in d iv id u a l o w n e r s c o u ld o w n 4 ,0 0 0 sta tio n s o r m o re . H ic k e y ( 2 0 0 2 ) id en tified p o ten tia l p r o b l e m s w ith j o i n t o w n e r s h i p o f n e w s p a ­ p e rs an d T V s ta tio n s in the s a m e m a r k e t. T h e n u m b e r o f i n d e p e n d e n t n e w s p a p e r o w n e r s w o u ld likely d e c re a s e , re d u c i n g the n u m b e r o f d iv e r s e n e w s vo ices. T h e s e jo i n tl y o w n e d n e w s p a p e r s and sta tio n s c o u ld be u n lik e ly to in v e s tig a te ea c h o th e r, se lf-c e n s o rin g t h e m s e l v e s to p ro t e c t th e ir o w n e r s ’ in terests. H ic k e y ( 2 0 0 2 ) said c o v e r a g e o f m e r g e r is su es is in a d e q u a te b e c a u s e the c o m p a n i e s that w ill profit fro m

d e re g u l a ti o n o w n n e w s o rg a n i z a ti o n s . H e

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identified the w o r s t - c a s e sc e n a r io th a t c o u ld stem fro m e li m i n a ti n g m e d ia o w n e r ­ ship rules: . . . s o m e t r a n s n a t i o n a l c o m p a n y th a t k n o w s little a n d c a r e s less a b o u t y o u r c o m ­ m u n i t y , a n d w h o s e m a i n a l l e g i a n c e is to its s t o c k h o l d e r s a n d a d v e r t i s e r s , w i l l o w n y o u r lo c a l d a i l y a n d w e e k l y n e w s p a p e r s , all y o u r t e l e v i s i o n an d r a d i o s t a ti o n s , th e c a b l e s y s t e m , th e I n t e r n e t s e r v i c e p r o v i d e r , s e v e r a l o f th e n a t i o n a l n e t w o r k s th at s e r v e y o u , y o u r lo c a l v i d e o s t o r e s a n d m o v i e h o u s e s , m a n y o f th e m a g a z i n e s an d b o o k s y o u r e a d , a n d all o f the s p o r t s t e a m s in y o u r a r e a . T h a t w o u l d a l l o w e n d l e s s c r o s s - p r o m o t i o n s o f th e o w n e r ’s in t e r e s t s , a n d p r o b a b l y v e r y little h a r d n e w s a b o u t a n y t h i n g h a v i n g n e g a t i v e i m p a c t o n a d v e r t i s e r s o r o n th e c o m p a n y itself. E v e r y ­ th i n g y o u r e a d o r s e e , e v e r y o p i n i o n , e v e r y i m a g e , a n d e v e r y j o t o f i n f o r m a t i o n w o u l d a r r i v e t h r o u g h o n e c o r p o r a t e filter (p. 54).

O w n e r s , p u b lish e rs , a n d g e n e r a l or sta tion m a n a g e r s , as w e ll as e d ito rs, n e w s d ire c to rs, an d re p o r te rs , m u s t e x p e c t to face th o r n y d e c is io n s re g a r d in g o w n e r ­ ship issues. M a n a g e r ia l d e c is io n s that s u p p o r t a d iv e rsifie d in f o rm a t io n m a r k e t ­ p lac e c o u ld re s u lt in difficult, p o te n tia lly jo b - th r e a te n in g , an d lega lly c o m p l e x c o n s e q u e n c e s . Y e t the fu tu re o f a s tro n g , i n d e p e n d e n t, and free p ress is at stake.

GENERAL AREAS OF LEGAL C O N C E R N Antitrust T h e S u p r e m e C o u r t a ffirm ed in A s s o c i a t e d P r e s s v. U n ite d S ta te s ( 1 9 4 5 ) th a t a n ­ titru st la w s a p p ly to the m e d ia . T h e N e w s p a p e r P r e s e rv a ti o n A c t ( N P A ) o f 1970 g iv e s c e rta in d aily n e w s p a p e r s a lim ited e x e m p t io n fr o m a n titru st law s. T w o n e w s p a p e r s w ith in a m a r k e t m a y fo rm a j o i n t o p e r a t in g a g r e e m e n t ( J O A ) w h e n o n e is in p ro b a b l e d a n g e r o f finan cial failure . In 2 0 0 1 , a b o u t 1 y e a r a fte r T h e D e n v e r P o st an d R o c k y M o u n t a in N e w s m e r g e d their b u s i n e s s o p e ra t io n s , the N e w s n a r r o w e d its lo sses 3 4 % to S I 5.9 m illio n . T h e N e w s h a d lost $24.1 m illio n in 2 0 0 0 (A c c o la , 2 0 0 2 ). U n d e r a J O A , the n e w s p a p e r s ’ a d v e rtis in g , c ir c u la tio n , p ro d u c t io n , a n d a d ­ m in is tra tiv e d e p a r t m e n t s are m e r g e d , w h e re a s th e ir e d ito ria l d e p a r t m e n t s are k e p t s e p a ra te. P r o p o s e d J O A s m u s t be a p p r o v e d b y the U .S . A tto r n e y G e n e ra l, a lth o u g h a d m i n is tra t iv e h e a ri n g s are o fte n h eld b e fo r e a d e c is io n is m a d e . R e a d ­ ers in te re ste d in a d d itio n a l in f o rm a t io n on a n titru st m i g h t re a d G ill m o r , B a rro n , an d S im o n (1 9 9 8 ) an d L a c y an d S im o n (1 9 9 2 ).

Libel C a rte r, D e e, an d Z u c k m a n ( 2 0 0 0 ) said libel and s l a n d e r are the p u b lic a tio n by o n e p e rs o n o f a d e f a m a to r y s t a te m e n t th at iden tifies the p e rs o n d e f a m e d and is

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m a d e to th at p e rs o n an d at least o n e o t h e r in d iv id u a l, w h o re a s o n a b ly u n d e rs ta n d th a t th e s t a te m e n t is d e f a m a to r y . D e f a m a t o r y s ta te m e n ts injure the r e p u ta tio n or c re a te an ill o p in i o n o f an o rg a n i z a ti o n o r liv ing p e rs o n , an d th ey e x p o s e on e to p u b lic s h a m e , rid ic u le , a n d /o r hatred . D e f a m a t o r y s ta te m e n ts in c lu d e w o r d s like m u r d e r e r , c h e a t , o r thief. T y p ic a l d e f a m a ti o n c a te g o rie s are d is h o n e s ty , b e in g a c c u s e d o f a c ri m e , e n g a g in g in i m ­ m o ra l b e h a v io r , p r o f e s s i o n a l in c o m p e te n c e o r m is c o n d u c t , fin ancial i r r e s p o n s i­ bility, o r e n g a g i n g in ch ild o r s u b s ta n c e a b u se . T r a d e libel in c lu d e s m a k i n g d is p a r a g in g s ta te m e n ts a b o u t a p r o d u c t o r se rv ice . D e f a m a t i o n is g e n e ra l ly g o v ­ e rn e d b y state law s, b u t is s u b j e c t to the lim ita tio n s im p o s e d b y the F irst A m e n d ­ m e n t ( B a rr o n & D ie n e s , 2 0 0 0 ; C a rte r, D e e , & Z u c k m a n , 2 0 0 0 ; G o ld s t e in , 2 0 0 2 ; fo r a m o r e d e ta ile d e x p la n a tio n o f libel, c o n s u l t G ill m o r , B a rro n , & S im o n [ 19 9 8 1 o r the m o s t r e c e n t A P S ty le b o o k ). L ib el in c lu d e s m o r e p e r m a n e n t ty p e s o f c o m m u n i c a t i o n s , suc h as p rin te d m a ­ terial, p h o to g r a p h s , p a in t in g s , m o tio n p ic tu re s, an d s ig n b o a r d s , w h e r e a s s la n d e r in c lu d e s less ta n g ib le f o r m s like the s p o k e n w o rd , g e s tu re s , an d sign la n g u a g e . T h e o n ly c o m p l e te an d u n c o n d it io n a l d e f e n s e to a libel civil a c tio n is tha t the fa cts stated are p r o v a b l y true. A s e c o n d d e fe n s e is a b s o l u te or q u alified p riv ileg e. A b s o l u t e p r i v il e g e m e a n s th a t c e rta in p e o p le in c e rta in c i r c u m s t a n c e s ca n m a k e lib e lo u s c o m m e n t s w ith o u t fe a r o f b e in g su ed . T h e s e in c lu d e m o s t p u b lic re c o r d s and o fficial p ro c e e d i n g s , ju d i c ia l p ro c e e d i n g s , an d le g islativ e p ro c e e d i n g s . T o w in a libel c a se , a p u b li c official o r figure m u s t p r o v e a c tu a l m a lic e o r th a t the re p o r te r or e d it o r a cte d w ith re c k le s s d is re g a rd or k n e w th e p u b li s h e d facts w e re false. A p riv a te p e rs o n m u s t s h o w th a t th e r e p o r te r o r e d ito r w a s n e g li g e n t o r did n ot act w ith d u e d il ig e n c e (C a rte r, D e e , & Z u c k m a n , 2 0 0 0 ). M c K e e (2 0 0 2 ) said n a m e - c a ll in g , s o p h o m o r ic c o m m e n t s , a n d /o r c o m m e n t s m a d e in b a d taste are not n e c e s s a rily libel w h e n d is c u s s i n g an issu e o f p u b lic in ­ terest. T w o m o r n in g ta lk -s h o w h o sts and th eir p r o d u c e r ri b b e d an e m p l o y e e o f a n o th e r sta tion w h o w a s an u n s u c c e s s f u l c o n te s ta n t on the T V s h o w , “ W h o W a n ts to M a r r y a M u l t i m i lli o n a ir e ? ” S h e w a s r i d ic u le d fo r c o m p e t in g w ith 50 o th e r w o m e n fo r a $ 3 5 ,0 0 0 w e d d in g ring, a n ew car, a n d the c h a n c e to m a r ry a c o m p l e te stra n g e r. T h e h o sts c a lle d the c o n te s ta n t a c h ic k e n b u t t y big s k a n k , and l o c a l l o s e r , b u t th e s e c o m m e n t s w e re n o t f o u n d to c o n s titu te libel. Still, p ru d e n t m e d i a m a n a g e r s m u s t c o n s i d e r w h e th e r to e n c o u r a g e e m p l o y e e s to p u b lis h or b r o a d c a s t th ese k in d s o f c o m m e n t s . P o te n tia lly s e r io u s p r o b l e m s m a y arise r e g a r d in g libel an d o n lin e p u b lic a tio n in the futu re. O n lin e p u b li s h e rs c o u ld b e s u e d fo r d e f a m a ti o n a n y w h e r e an o n lin e article is read. A s e r io u s c h illin g e ffe ct m a y re s u lt as p u b li s h e rs m i g h t a v o id p o s tin g m a te ria l th a t c o u ld p o te n tia lly o ff e n d s o m e o n e on th eir W e b sites. M e d i a m a n a g e r s m a y h a v e to c h e c k th e libel sta tu te s in v a rio u s lo calities b e fo r e p u b ­ lishing stories o n lin e tha t c o u ld p o te n tia lly d e f a m e p e o p le in th o s e areas. F u r ­ ther, U .S . c o u rts are g e n e ra l ly v ie w e d as m o r e p ro t e c ti v e o f free s p e e c h righ ts th a n c o u rts in o th e r n atio n s. A n y m e d i a o u tlet tha t p u b li s h e s m a te ria l p o te n tia lly

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h a r m in g the r e p u t a ti o n o f a n o n -U .S . c itiz e n s h o u ld h a v e its c o u n s e l r e v ie w libel an d d e f a m a ti o n law s in th at p e r s o n ’s nation b e fo r e p u b li c a ti o n ( K a p la n , 2 0 0 2 ). A d v is e re p o r te rs a n d e d ito rs th a t the p la in tiff in a libel c a se w ill in q u ire a b o u t th e ir state o f m in d w h e n tr y in g to p ro v e th ey w e re r e c k l e s s o r k n e w w h a t they w e re p u b li s h i n g w a s false. T e ll e m p l o y e e s to k e e p m e m o s in th e ir files d e m o n ­ stra tin g h o w care w a s ta k e n and w h y th e y b e li e v e d the sto ry w a s fair an d a c c u ­ rate. H a v e at least o n e n e w s r o o m s u p e r v is o r k e e p c u r r e n t on state an d fed eral libel d e v e lo p m e n ts . In s tru c t re p o r te rs to k e e p c a re fu l n o te s , h a v e m o r e th an o n e s o u r c e a n d /o r o b ta in s u p p o r tin g d o c u m e n t s fo r p o te n tia lly lib e lo u s sta te m e n ts , a n d o b ta in the a p p ro p r ia te c o u r t d o c u m e n t s (s u ch as c o m p l a in t s , c e a s e - a n d d e sist o rd e rs, a n d j u d g m e n t s ) w h e n a lle g a tio n s are m a d e . R e p e a t w o r d s like a l ­ le g e d a n d a lle g a tio n in a sto ry w h e n leg al a c tio n is p e n d in g . A v o id p u b li s h i n g a sto ry b a s e d on an o f f ic ia l’s in te n t to c h a r g e o r in v e s tig a te . It m a y b e b e tt e r to w a it until c h a rg e s are filed. F in ally , h a v e a l a w y e r r e v ie w p o te n tia lly lib elo u s stories b e fo r e p u b lic a tio n (G il lm o r et al., 1998; G o ld s t e in , 2 0 0 2 ). A lth o u g h p r u d e n c e a n d c a re m a k e g o o d s e n s e , a lw a y s c o n s i d e r w h e t h e r the pu blic in te rest is b e st s e rv ed b y p u b lic a tio n o r b ro a d c a s t. L a w y e r s m a y ev a lu a te the c o st o f a la w su it ra th e r than its c h a n c e s fo r su c c e s s o r w h e th e r se lf-c e n s o rsh ip se r v e s the p u b lic . A m e d i a m a n a g e r m a y h a v e to ta ke a stan d a g a in s t a fr iv o lo u s la w s u it in te n d e d to d is c o u r a g e free sp e e c h .

Privacy T h e rig h t o f p ri v a c y e n c o m p a s s e s the rig h t to live o n e ’s p riv a te life fre e fro m p u b lic ity ( K e e to n , 1984). P riv a c y en titles an in d i v id u a l to p r e v e n t the use o f or in te rfe re n c e w ith p e r s o n a l an d in tim a te a s p e c ts o f life. S u c h in v a s io n s p r e s u m ­ ab ly h a v e a n e g a tiv e e ff e c t on a p e r s o n ’s p s y c h o l o g ic a l w e ll- b e in g (G illm o r, B a rro n , & S im o n , 1998). C a rte r, D ec, and Z u c k m a n ( 2 0 0 0 ) id entified the f o u r a s p e c ts o f p riv acy: (a) a p p ro p r ia t io n o f a n o th e r p e r s o n ’s n a m e o r lik e n e ss, (b) u n re a s o n a b le in t ru ­ sion on a n o th e r p e r s o n ’s se c lu s io n , (c) p la c in g a n o th e r p e rs o n in a false light b e ­ fo re the p u b lic , a n d (d) u n r e a s o n a b le p u b lic ity a b o u t a n o th e r p e r s o n ’s p rivate life. T h e rig ht to p riv a c y is f o r fe ite d w h e n a p e rs o n is v o lu n ta rily or in v o lu n ta r ily in v o l v e d in a n e w s e v e n t. A j o u r n a l i s t is ty p ic a lly p ro t e c te d w h e n w ritin g a b o u t s o m e o n e in v o l v e d in a m a t te r o f le g itim a te p u b lic interest. Y e t u n re a s o n a b le p u b lic a tio n o f m a te ria l w ith no c u r r e n t n e w s w o r th i n e s s tha t r e v e a ls e m b a r r a s s ­ ing p riv a te facts is ty p ic a lly u n p ro te c te d . N e w s m a n a g e r s s h o u ld e x e rc i s e care, d is c re tio n , an d g o o d taste w h e n c o n s i d e r in g w h e th e r to p u b lis h a story on a p riv a te p e rs o n . C a rte r, D e e , and Z u c k m a n ( 2 0 0 0 ) said fe d e ra l law p ro h ib its the in t e r c e p ­ tion o f c o n v e r s a ti o n s c a rrie d o v e r a w ire an d n o n w ir e c o n v e r s a ti o n s w h e r e p r i­ v a c y is e x p e c t e d . In 1994, this p ro t e c ti o n w a s e x te n d e d to c e ll u la r and w ire le ss

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c o m m u n ic a t io n . F e d e r a l law p ro h ib its u n a u th o r iz e d a c c e s s o r ta m p e r i n g w ith in ­ f o r m a ti o n s to ra g e facilities fo r e le c tro n ic c o m m u n i c a t i o n s se rv ice s. Jo u r n a lis ts w h o w ire ta p a p h o n e c o n v e r s a ti o n , b u g a ro o m w h e re a m e e t in g is held , o r a c ­ c e ss a p riv a te p h o n e m a il s y s te m m a y be liable. A m a n a g e r s h o u ld be fa m il ia r w ith state p ri v a c y law s, e n s u r e th at at le a s t o n e n e w s r o o m s u p e r v is o r k e e p s up w ith fed eral and state p ri v a c y statu es, an d e d u ­ cate e d ito rs an d re p o r te rs a b o u t th em . In s o m e sta tes, it is legal fo r re p o r te rs to c o n c e a l a u d io t a p e r e c o r d e rs w h e n ta lk in g to n e w s s o u r c e s , y e t o t h e r states o u t ­ law c o n c e a l e d a u d io r e c o r d in g . It is illegal to u se a h id d e n v id e o c a m e r a to r e c o r d p e o p le w ith o u t th e ir c o n s e n t in s o m e states (C arter, D ee, & Z u c k m a n ,

2000 ). T h e u se o f c o m p u t e r i z e d r e c o r d s an d In te rn e t a c c e s s a p p e a r s likely to i n t e n ­ sify the c o n flic t b e tw e e n o p e n a c c e s s to r e c o r d s an d in d iv id u a l p riv a c y . D elta a n d M a t s u u r a ( 2 0 0 2 ) said an y firm th at c a p tu r e s an d u se s p e rs o n a l d a ta r e g a r d in g In te rn e t u sers o r th eir a c tiv itie s s h o u l d d is c lo s e h o w th o se d a ta w o u ld be u se d in a d v a n c e . F ir m s s h o u l d d e v e lo p c le a r p e rs o n a l d ata, c o n s u m e r c o m m u n i c a t i o n s , an d d is c lo s u r e p ri v a c y p o licies. E n s u r e th a t o n c e the p o lic ie s are i m p le m e n te d , th ey are a p p lie d r i g o ro u s l y an d d is c lo s e d c o n s i s te n t ly w ith all legal r e q u i r e ­ m e n ts. R e q u ire a v alid le g a l o r d e r b e fo r e c u s t o m e r in f o rm a tio n is d is c lo s e d and n o tify c u s t o m e r s o f su c h o rd e r s b e fo re d is c lo s i n g th e ir d ata. T h a t a llo w s c u s ­ t o m e rs to c h a ll e n g e the re le a se o f in f o rm a t io n b e fo r e it oc cu rs. P ro te c tin g p riv a c y ra ises sp e c ia l c o n c e r n s fo r m a r k e te r s o r o th ers ta r g e tin g or c r e a tin g W e b p a g e s for c h ild re n on the In tern et. T h e C h i l d r e n ’s O n lin e P riv a c y P ro te c tio n A c t r e q u ire s th o s e w h o k n o w i n g l y c o ll e c t p e rs o n a l in f o rm a t io n fro m c h ild re n y o u n g e r th an 13 y e a rs o ld to o b ta in verifia b le c o n s e n t fr o m th e c h i l d ’s p a re n t o r g u a r d i a n an d p ro v i d e an o n -lin e d e s c r ip tio n o f its p ri v a c y p o lic ie s an d p ra c tic e s b e fo r e c o lle c tin g th at in f o rm a t io n . D e lta and M a t s u u r a ( 2 0 0 2 see p. A p p . 1 - 2 ) said su ch p ri v a c y p o lic ie s m u s t, at m i n i m u m , id e n tify the ty p e s o f in f o rm a tio n to b e c o lle c te d , d e s c r ib e h o w th a t in f o rm a t io n w ill be u sed , a n d id en tify all third p artie s w h o h a v e a c c e s s to tha t in f o rm a t io n . ( M o r e i n f o r m a ­ tion an d I n te rn e t links on p ro te c tin g the p riv a c y o f c h ild re n arc f o u n d in the R e g ­ u la to ry an d S e lf - R e g u la t o r y E le c tro n ic R e s o u r c e s se c tio n at the en d o f this c h a p te r.)

PREVENTIN G LEGAL PROBLEMS T h e r e are g e n e ra l p rin c ip le s a n d p ro c e d u r e s th a t m e d i a m a n a g e r s ca n institu te to m i n im iz e leg al p r o b l e m s . G e n e r a ll y all c o m m u n i c a t i o n s an d a g r e e m e n t s a m o n g s u p e r v is o r s , e m p l o y e e s , an d th o se o u ts id e th e o rg a n i z a ti o n s h o u ld be d o c u ­ m e n te d . T h e fo l lo w in g sectio n on p e r f o r m a n c e e v a lu a tio n p r o v i d e s d o c u m e n t a ­ tio n g u id e l in e s th a t c a n be a d a p te d an d a p p lie d to o t h e r areas.

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P erform ance M a n a g e m e n t and Evaluation O n e o f the first th in g s a new m a n a g e r m u s t d o is d is c o v e r w h e th e r e m p l o y e e s k n o w h o w th e i r p e r f o r m a n c e is m e a s u re d . It is im p o r t a n t to r e m e m b e r th a t any d o c u m e n t a m a n a g e r p r e p a r e s a b o u t an e m p l o y e e c o u ld p o te n tia lly be u se d as e v id e n c e in a trial. Z a c h a r y ( 2 0 0 0 ) said p e r f o r m a n c e e v a lu a tio n s c o u ld le ad to w r o n g f u l d is c h a rg e , libel, d e f a m a ti o n , d is c r im in a t io n , a n d /o r in te n tio n a l inflic­ tion o f e m o t io n a l d is tre s s law su its. R e g u la r, fo rm a l c o m m u n i c a t i o n from s u p e r v is o r s w ith th e ir e m p l o y e e s a b o u t p e r f o r m a n c e is s im p ly g o o d b u s i n e s s p ra ctice . D o c u m e n ti n g p e r f o r m a n c e p r o b ­ le m s u sin g f a c tu a l in f o rm a t io n s u p p o r ts a f i r m ’s le g itim a te , n o n d is c r im in a t o r y r e a s o n s fo r re w a r d i n g , d is c ip lin in g , o r firing an e m p l o y e e . T r y to s t a n d a rd iz e p e r f o r m a n c e c rite ria an d m e a s u r e m e n t a c ro s s the o rg a n i z a ti o n , if p o ss ib le , to e n ­ ab le c o m p a r i s o n s b e tw e e n e m p l o y e e s in v a rio u s d e p a r t m e n t s an d d e m o n s tr a t e th a t s t a n d a rd s an d p ro c e d u r e s are a p p lie d c o n s i s te n t ly (F e n tin , 2 0 0 2 ; H o w to A lig n , 2 0 0 2 ; H o w to R e m a k e , 2 0 0 2 ; T w o W a y s , 2 0 0 2 ; Z a c h a r y , 2 0 00 ). N o tify e m p l o y e e s a n d e d u c a t e th e m a b o u t h o w to p re p a r e fo r e v a lu a tio n s lo ng b e fo r e th ey o c c u r. D e v e lo p o rg a n i z a ti o n a l g o a ls , a ll o w i n g m a n a g e r s , s u p e r ­ v isors, and e m p l o y e e s to p a rtic ip a te in setting th e m . M e e t w ith y o u r e m p l o y e e s to d is c u s s the w ritten g o a ls , p e r f o r m a n c e m e a s u r e m e n ts , an d d e a d li n e s o f e v a l u ­ a tion s. E x p la in w h a t r e w a r d s m a y be g iv e n fo r e x c e p t io n a l p e r f o r m a n c e an d the p e n a ltie s fo r u n s a tis f a c to r y p e r f o r m a n c e . W h e n fin alized , c o m m u n i c a t e g o a ls to s u p e r v is o r s and e m p l o y e e s an d in c o r p o ra t e th em into p e r f o r m a n c e e v a lu a tio n s (H o w to A lig n , 2 0 0 2 ). T h is m a x i m i z e s the li k e lih o o d o f a c h ie v in g o rg a n i z a ti o n a l g o a ls and p ro v i d e s o b je c t iv e p e r f o r m a n c e criteria th a t a p p ly e q u a lly to all em ployees. G iv e e v e r y e m p l o y e e a c o p y o f the in s tru c tio n s an d f o r m s u se d to e v a lu a te th e ir p e r f o r m a n c e . In c lu d e in w ritin g tha t there are no v alid oral e m p l o y e e a g r e e ­ m e n ts in all a p p li c a ti o n fo r m s , e m p l o y e e m a n u a l s , a n d W e b sites ( T h o m p s o n , 2 0 0 2 ). T h a t w a y m a n a g e r s an d e m p l o y e e s k n o w th a t p r o m is e s m a d e v e rb a lly are n o t b in d in g . P o st all f o r m s , m a n u a l s , an d e m p l o y m e n t d o c u m e n t s o n th e c o m ­ p a n y ’s W e b site an d in fo rm all e m p l o y e e s w h e n an y re v isio n s are m a d e . E m ­ p lo y e e s s h o u ld n ot b e s u r p ris e d w h e n n e w criteria are u se d o r new m a n a g e r s w ith n ew e x p e c t a tio n s e v a lu a te th e m ( T w o W a y s , 2 0 0 2 ). C o n d u c t fo r m a l, w ritte n e v a lu a tio n s o f all e m p l o y e e s a n n u a ll y on o b je c tiv e criteria s u c h as th eir a bility to p e rf o rm e ss e n tia l j o b skills. S tate su ch e x p e c t a ­ tion s c le a rly an d d ire c tly on p e r f o r m a n c e e v a lu a tio n fo r m s . C o n s i d e r in c lu d in g f e e d b a c k from m a n a g e r s a s w ell as e m p l o y e e s ’ p e e rs a n d s t a f f (F e n tin , 2 0 0 2 ; H in k le , H e n s le y , S h a n o r, & M a r tin , 2 0 0 2 ; H o w to A lig n , 2 0 0 2 ; H o w to R e m a k e , 2 0 0 2 ; T w o W a y s , 2 0 02 ). U se specific m e a s u r e s w ith specific c rite ria to a v o id the halo e f f e c t o f g iv in g h ig h e v a lu a tio n s o verall to fa v o rite e m p l o y e e s or th o s e w h o p e rf o rm w ell on ly in a few a re a s (H o w to R e m a k e , 2 0 0 2 ). In c lu d e se v e ra l m e a s u r e m e n t o p tio n s on

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e v a lu a tio n f o r m s su c h as o u ts ta n d in g , very g o o d , g o o d , n e e d s im p r o v e m e n t, u n ­ s a tisfa c to r y , n o t o b s e r v e d , an d n o t a p p li c a b le . A m a n a g e r ratin g a r e p o r t e r ’s p e r ­ f o r m a n c e c o u ld ra te e a c h o f the fo llo w in g j o b d u ties a n d skills u sin g th ese o p tio n s: (a) sto ry a c c u ra c y ; (b) ability to m e e t d e a d li n e s ; (c) n e w s g a th e r in g skills; (d) ability to s u g g e s t an d d e v e lo p story id eas; (e) ab ility to d e v e lo p s o u r c e s ; ( f ) level o f a w a r e n e s s an d k n o w l e d g e o f th e a s s ig n e d b e a t an d c o m m u ­ nity; (g) b re a d th o f c o v e r a g e , in c lu d in g c o v e r a g e o f m in o ritie s a n d m in o rity v ie w p o in t s ; (h) w ritin g skills, in c lu d in g sto ry o r g a n i z a ti o n , im p o r t a n c e , style, an d w o r d se le c tio n ; (i) ability to c o m m u n i c a t e an d w o rk w ith the p u b lic , s u p e r v i­ s o rs, an d o t h e r s t a f f m e m b e r s ; ( j ) ab ility to r e s p o n d to c o n s t ru c ti v e critic ism or f e e d b a c k ; a n d (k) o v e ra ll p e r f o r m a n c e ( i n c lu d in g o th e r r e l e v a n t fa cto rs, a c c o m ­ p li s h m e n ts , o r a re a s for i m p r o v e m e n t n o t c o v e r e d in a th r o u g h k). U s in g m e a ­ s u r e m e n t o p tio n s to rate p e r f o r m a n c e a llo w s m a n a g e r s to d is tin g u is h o b je c tiv e ly b e tw e e n e m p l o y e e s p e r f o r m i n g at the h ig h e s t, sa tis f a c to r y , an d u n s a tis f a c to r y levels as w ell as th o s e p e r f o r m i n g at the h ig h e s t levels o n s o m e task s, b u t u n s a t­ isfacto rily at o t h e r ta s k s (F e n tin , 2 0 0 2 ; S k o le r , A b b o tt, & P re sse r, 2 0 0 2 ; T w o T o o ls , 2 0 0 2). S k o le r , A b b o tt, an d P r e s s e r ( 2 0 0 2 ) said to u p d a te j o b d e s c r ip ti o n s an n u a lly . A s k specific q u e s t io n s to d e v e lo p n ew d e s c r ip ti o n s lik e (H o w to R e m a k e , 2 0 0 2 ; T w o T o o ls , 2 0 0 2 ): (a) W h y w a s the j o b c r e a t e d ? (b) H o w s h o u l d a p e rs o n d o in g this j o b sp e n d his o r h e r ti m e ? (c) W h a t are the three m o s t im p o r t a n t d u tie s o f this p o s i ti o n ? (d) W h a t d o e s it ta k e to su c c e e d at this j o b ? an d (e) W h a t is the e a sie st w a y to d e t e r m i n e w h e t h e r th is j o b is d o n e w ell? T h e n d e v e lo p a p r e l im in a ry jo b d e s c r ip tio n , a ll o w i n g all a f f e c te d e m p l o y e e s an d s u p e r v is o r s to a g re e or d is a g re e w ith the list o f jo b d u ties a n d s u g g e s t r e v i ­ sio n s in w ritin g . H a v e all a p p r o p r ia t e s u p e r v is o r s an d e m p l o y e e s a c k n o w le d g e in w ritin g th at th e y re v i e w e d a n d r e c e i v e d the final jo b d e s c r ip tio n a fte r it is a p ­ p ro v e d . T h is e d u c a t e s all p a rtie s a b o u t j o b d u tie s, h e lp s p r e v e n t in a c c u ra te i m ­ p r e s s io n s a b o u t w h a t a j o b en tails, an d assists e m p l o y e e s an d s u p e r v is o r s in d e a lin g w ith d is p u te s o v e r j o b d u tie s d u rin g or a fte r p e r f o r m a n c e e v a lu a tio n s (H in k le , H e n s le y , S h a n o r , & M a r tin , 2 0 0 2 ). M a n a g e r s s h o u ld p ro v i d e specific c o m m e n t s an d e x a m p l e s in p e r f o r m a n c e r e v ie w s . S tate p e r f o r m a n c e a c c u ra t e ly , c le a rly , and c o n c is e ly b e c a u s e it is in e v e r y o n e ’s b e s t in te re s t to d o so (F e n tin , 2 0 0 2 ; S k o le r , A b b o tt, & P re s se r, 2 0 0 2 ). M a n a g e r s m i g h t d e c id e on a central m e s s a g e fo r the e v a lu a tio n and then s u p p o r t th a t a p p ra is a l w h e n c o m p l e ti n g the e v a lu a tio n fo rm . P ro v id e o b je c tiv e , q u a n ti fi­ ab le, an d fa ctu al in f o rm a t io n . In c lu d e d e s c r ip ti o n s o f in c id e n ts in p e r f o r m a n c e e v a lu a tio n s w h e r e e m p l o y e e s acte d a b o v e o r b e lo w e x p e c t a tio n s to a v o id s u b j e c ­ tive j u d g m e n t s b a s e d on p e rs o n a lit y o r s y m p a th y ra th e r th an p e r f o r m a n c e (H o w to R e m a k e , 2 0 0 2 ; T w o T o o ls , 2 002 ). If an e v a lu a tio n r e v e a ls tha t an e m p l o y e e lac k s n e c e s s a ry j o b skills, p ro v i d e an d d o c u m e n t tr a in in g in th o s e skills. D o c u m e n t and o ffe r c o n ti n u o u s f e e d ­ b a c k to e v e r y e m p l o y e e w h o p e r f o r m s b e lo w e x p e c t a tio n s . A ls o c o n s i d e r h ow

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e m p l o y e e s a c h ie v e d resu lts. F o r e x a m p l e , if o n e a c c o u n t e x e c u t iv e su r p a s s e s sales g o a ls u sin g u n e th ic a l, in a p p r o p ria te , o r c o u n te r p r o d u c t iv e m e t h o d s , d o not r e w a r d the b e h a v io r ( H o w to A lig n , 2 0 0 2 ). T r e a t p e r f o r m a n c e p ro b l e m s c o n s is te n tly a c ro s s e v a lu a tio n s to a v o id d i s c r i m ­ in a tio n c la im s . F o r e x a m p l e , if tw o e m p l o y e e s a re o ften tard y , d o c u m e n t and a d ­ d re s s ta r d in e s s the s a m e w a y in b o th e v a lu a tio n s . C o n s is te n c y in e v a lu a tio n h elp s p ro te c t a firm fro m w ro n g fu l d is c h a rg e actio n s (H in k le, H e n s le y , S h a n o r, & M a r tin , 2 0 0 2 ; H o w to A lig n , 2 0 0 2 ; H o w to R e m a k e , 2 0 0 2 ; S k o lc r, A b b o tt, & P re s sc r, 2 0 0 2 ; T w o T o o ls , 2 0 0 2 ). Id ea lly , a p e r f o r m a n c e e v a lu a tio n e n a b le s a m a n a g e r to set g o a ls fo r the e m ­ p lo y e e to a c c o m p lis h b e fo r e the n e x t re v ie w . T h e s e g o a ls c o u ld in c lu d e p r o b ­ lem s, o r b e l o w - p a r p e r f o r m a n c e to e li m i n a te , as w ell a s a c c o m p l i s h m e n t s to a c h ie v e . In c lu d e a w ritten a c k n o w l e d g m e n t s ig n e d b y the e m p l o y e e and s u p e r v i­ s o r to w o rk to w a r d th o se g o a ls . A llo w the e m p l o y e e to sign a d if fe re n t form a c ­ k n o w l e d g i n g d is a g r e e m e n t w ith the e v a lu a tio n a n d /o r g oals. G iv e the dissatisfied e m p l o y e e an o p p o r t u n it y to r e s p o n d . T h is is fair to e m p l o y e e s an d p r e v e n t s a late r c laim that the y w e re u n a w a r e o f the e v a lu a tio n (H in k le , H e n s le y , S h a n o r, & M a r tin , 2 0 0 2 ; S k o le r, A b b o tt, & P re s se r, 2 0 0 2 ).

T raining M anagers to Con d uct P erform ance Evaluations A n o t h e r im p o r t a n t a s p e c t o f p e r f o r m a n c e e v a lu a tio n is to e ff e c tiv e ly train m a n ­ a g e rs h o w to c o n d u c t th em . H in k le , H e n s le y , S h a n o r, an d M a r tin ( 2 0 0 2 ) and S k o le r , A b b o tt, a nd P r e s s e r (2 0 0 2 ) said e m p l o y e r s s h o u ld p ro v id e c le a r in s tr u c ­ tion s to p e r f o r m a n c e e v a lu a to rs , tra in th e m to e li m i n a te b ias, an d m o n i t o r the p r o c e s s w h ile e v a lu a tio n s o c c u r. P e r f o r m a n c e a p p ra i s a l tr a in in g u su a lly tak es a b o u t a d a y an d i n c l u d e s v a ri o u s p ra c tic e e x e rc i s e s o n the ty p ic a l e v a lu a tio n e rro rs th at m a n a g e r s m a k e . P ro v id e cle a r, w rit te n in s tru c tio n s e x p la i n in g the p u r ­ p o se and im p o r t a n c e o f e v a lu a tio n s , a c c e p t a b le w o r k b e h a v io r s , res u lts to be e x ­ p e c te d fo r e a c h e m p l o y e e , an d w h y th ey s h o u ld be fair, h o n e st, an d a c cu rate. E m p h a s i z e firm ly a n d r e p e a t e d ly d u rin g tr a in in g th at s t e re o ty p i n g o r b ias is n ot to lera ted . In c lu d e in f o rm a t io n a b o u t d e a lin g w ith p o te n tia l w ro n g fu l te r m in a tio n o r e q u a l e m p l o y m e n t o p p o r t u n it y p r o b l e m s . T ra in all m a n a g e r s on the p r o p e r w a y to c o n d u c t e v a lu a tio n s a n d c o m m o n e r ­ ro rs to a v o id . F o r e x a m p l e , in s tru c t m a n a g e r s to a v o id ra tin g e m p l o y e e s w h o r e ­ s e m b le th em o r w h o th ey like m o r e h ig h ly than o th e r e m p l o y e e s . R e s is t the te n d e n c y to rate all e m p l o y e e s in the m i d d le o f the scale, e s p e c ia lly w h e n p e r f o r ­ m a n c e clearly d e se rv e s a lo w e r o r h ig h e r rating. Be carefu l n ot to rate an e m p l o y e e a g a in s t p eers ra th e r than o b jec tiv e jo b stand ards. A v o id attrib utin g e m p l o y e e fail­ u res to fac to rs th ey c o n tr o l and s u c c e s s e s to e x te r n a l fa cto rs. R e s is t the te n d e n c y to g iv e r e c e n t m i n o r e v e n ts m o r e im p o r t a n c e th an m a j o r e v e n ts th at o c c u rr e d m o n t h s e arlie r. In s te a d c o n ti n u a ll y k e e p n o te s in a file o f e m p l o y e e p e r f o r m a n c e

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th ro u g h o u t the ev aluatio n period to refer back to w h e n co n d u ctin g the evalu atio n (H inkle, H en sley, S h ano r, & M artin, 2 00 2; H o w to R e m a k e , 20 02 ; Skoler, A bb ott, & Presser, 2002; T w o Tools, 200 2; Z ac h a ry , 2000). A v o id v ag ue c o m m e n ts like, “J a n e ’s pe rform a nce is im p ro v in g ” or “Joe needs to w ork harder.” State exactly w hy perfo rm an ce is im p ro ving o r identify the na­ ture o f the perform an ce problem factually. F o r ex am p le, say the e m p lo y ee was tardy 15 tim es during the evaluation period. Do not speculate about the cau ses o f perform a nce pro b le m s to avoid legal pitfalls (Hinkle, H ensley, Shanor, & M artin, 2002; H ow to R em ak e, 2002; Skolcr, A bbott, & Presscr, 2002; T w o Tools, 2002). A m a n a g e r w h o can n o t be h on est with e m p lo y e e s ca n n o t gen erate positive results, lacks credibility, and potentially creates legal pro b lem s. S o m e tim e s a m a n a g e r g e n u in ely likes and do es not wish to upset an e m p lo y e e by a p o o r e v a l­ uation. Pairing a p o o r rating with an u n nece ssa ry positive c o m m e n t to spare the e m p l o y e e ’s feelings is unw ise. R efrain from tem p erin g bad with go od (or vice versa) b ecau se it m a k e s ev aluatio ns seem arbitrary (H ink le, H ensley, Shanor, & M arlin, 20 02 ; Skoler, A b bo tt, & Presser, 2002; Z ac h a ry , 2000). Identify supervisors w ho try to avoid co n fro n tin g p erson ne l pro b lem s. A v o id ­ ing unp leasant c o n fro n tatio n s in the hope that future p e rf o rm a n c e will im p ro v e if g oo d ratings or positive rein fo rcem en t is given now can create legal p ro b le m s for a firm. E x cessiv e le niency falsely raises and then deflates an e m p l o y e e ’s e x p e c ­ tations. M ore im portant, e m p lo y e e s w ho are u n a w are o f their s h o rtc o m in g s c a n ­ not co rrect their deficiencies (H inkle, H ensley, Sh a n o r, & M artin, 200 2; Sk oler, A bb ott, & Presser, 2 00 2; Z a c h a ry , 2000). H av e all su pervisors sign a form ac k n o w le d g in g th ey read all jo b descriptions and re v iew ed and c o m p lie d with all p e rf o rm a n c e ev alua tion gu idelin es and in ­ structions every time they c o n d u c t evalu atio ns. Place each form in the m a n a g e r ’s p erson nel file. E stab lish central m o nito ring o f p e rf o rm a n c e re v ie w s to ensure m a n a g e rs rate e m p lo y e e s co nsistently and bias does not creep into the process. H av e cach m a n a g e r ’s su p erv iso r review e v a lu a tio n s b efore they arc given to e m ­ ployees. T rain th ese u p p e r m a n a g e rs to lo ok for potential legal p ro b lem s, in c o n ­ sisten cies in em p lo y e e ratings, inap p ro p ria te or p erso nal c o m m e n ts , and u n in ten de d m e a n in g s in the ev alua tion s o f lo w e r level m a n a g e rs they review (H inkle, H ensley, S h ano r, & M artin, 2002; H o w to A lign, 20 02 ; H ow to R e ­ m ak e, 20 02 ; Skoler, A bbott, & Presser, 2 0 02; T w o T oo ls, 2002). R equ ire m a n a g e rs to initiate p e rf o rm a n c e c o n v ers atio n s to ensu re a c o n tin u ­ ing dialogue. All w ritten p e rf o rm a n c e eva lua tion s, especially u nfa vo ra ble ones, should be follo w ed by fa ce-to-face c o n v ers atio n s with the em p lo y e e. T w o m a n ­ a g ers should be present. R equire the e m p lo y e e to ack n o w le d g e in writing that she or he received the written p e rf o rm a n c e evalu ation and the m ee tin g w as held to discu ss it. M a n a g e r s should d o c u m e n t w ha t they discussed and file the notes w ith the evaluation. A llo w e m p lo y e e s w ho disagree with an e v alua tion to m a k e w ritten c o m m e n ts and appeal w ithin an ap prop riate time period (Fentin, 2002; Skoler, A bb ott, & Presser, 2 00 2; T w o W a y s, 2002).

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Progressive Discipline M a n a g e r s m u s t be fam iliar with app ro priate p roce du res for d iscip lin ing and, if necessary , firing e m p lo y e e s w hen u nsatisfactory e v alu a tio ns occur. U sing p ro ­ gressive discipline (or using an oral w arnin g, w ritten w arn ing , then dism issal) g ives e m p lo y e e s a fair ch ance to co rre ct p e rfo rm a n c e before term in atio n and pro v ides d o c u m e n ta tio n for em p lo y e rs w h o m u st fire em p lo y e e s fo r legitimate, no n d is crim in a to ry reaso ns (Fentin, 2002). W ro n g fu l-term in atio n law suits may result from a failure to d o c u m e n t p rog re ssiv e discipline. A p ro gre ssiv e discipline system should begin with recruitm ent and co ntin ue through orientation, training, p e rfo rm a n c e eva lua tion , and supervision (Falconc, 1997). Fentin (2002) and F alc o n c (1 99 7) prov ided d o c u m e n ta tio n g u idelines for i m ­ p lem en tin g prog ressive dis cipline. B egin with private, in fo rm al c o u n selin g ab ou t the un satisfacto ry p e rf o rm a n c e o r behavior. T h e m a n a g e r should d o c u m e n t the c o nv ersa tion , includ ing w hen it took p lace and w h at w as discu ssed , and place a m e m o in the e m p l o y e e ’s p erso nn el file. A verbal w arn in g is typically the n ext step. T w o m a n a g e rs (e.g., the e m ­ p lo y e e ’s direct su p e rv iso r and the head o f th at d e p a rtm en t) shou ld m e e t in p ri­ vate with the em p lo y e e , discuss the p e rf o rm a n c e pro b lem s, pro vide specific steps for co rrecting them , and give goals and deadlin es to c o m p le te the c o rr e c ­ tions. T h e two sup erv iso rs and the em p lo y e e sign a notice d o c u m e n tin g that the e m p lo y e e received the verbal w arnin g. O nly o th er e m p lo y e e s w h o actually need to know abo ut the w arnin g to c o n d u c t their jo b s are info rm ed , bu t directed to k eep it private. T hat w ay the e m p l o y e e ’s privacy is protected and the c o m p a n y d oes not risk d efam atio n charges. If the verbal w arn in g fails, give the e m p lo y e e a w ritten w arnin g based on o b ­ jec tiv e p e rfo rm a n c e criteria that include specific e x a m p le s a b o u t the p ro blem or ap p are n t inability to perform at m in im u m standards. T h e d o c u m e n t should e x ­ plain w h y the p e rf o rm a n c e w as u nsatisfactory, su g g est a w ay to im p ro ve, e sta b ­ lish a d isciplinary tim e period for im p ro v e m e n t, and outline the c o n se q u e n c e s of failing to im p ro ve. F or n o n p ro b atio n ary w o rk ers, the d isciplinary period m ig h t be 30 day s for a p o o r p e r f o r m e r ’s w ork, 60 day s for an un de rac h iev in g sales p erso n , o r 90 d ays for a tard iness o r ab sen teeism pro b le m . A gain hold the m ee tin g in private w ith tw o m a n a g e rs present. B oth m u s t w itn ess the e m ­ ployee sign in g the w ritten w a rn in g to a c k n o w le d g e its receipt. Both must d o c u m e n t w h a t w as said in the m ee tin g and place the notes, a co py o f the written w arn in g , the signed a c k n o w le d g m e n t, and all related m aterials in the e m p l o y e e ’s file. G iv e the em p lo y e e the o p p o rtu n ity to resp o n d verbally and in writing. U se the sa m e ty pe o f d o c u m e n t for any em p lo y e e w h o m a k e s a sim ilar infraction to e n ­ sure c on siste ncy o f discipline. If one e m p lo y e e receiv e d a rep rim a n d o r d is ci­ pline for a p articu lar infraction, all em p lo y e e s m ak in g the sam e in fraction should receive the sam e discipline.

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F a lc o n e ( 1 9 9 7 ) p ro v i d e d e x a m p l e s o f h o w to w rite u p p ro g r e s s i v e d is c ip l i­ n ary a ctio n s. F o r e x c e s s iv e ta r d in e s s , a first w ritte n w a r n in g m i g h t state: •

O n A p ril 12, 2 0 0 3 , y ou h a d y o u r third in s ta n c e o f ta r d in e ss d u rin g the p r e ­ v io u s 2 - m o n th p e ri o d w h e n y o u a rr iv e d 35 m i n u te s late to w o rk . T h is w r i t ­ ten w a rn in g is to no tify y o u th at c o n ti n u e d ta r d in e s s c o u ld re s u lt in d is c ip lin a ry a c tio n an d, u ltim a te ly , te r m in a tio n o f y o u r jo b . Y o u are no w b e in g p la c e d on a 9 0 - d a y d is c ip lin a ry p e rio d d u rin g w h ic h y o u m u s t a rriv e at w o rk on tim e o r f u r th e r d is c ip lin a ry a c tio n s, p o s s ib ly re s u ltin g in t e r m i ­ n a tio n , w ill o c c u r. T h is 9 0 - d a y d is c ip lin a ry p erio d b e g in s to d a y , A p ril 12, 2 0 0 3 . I f y ou are ta rd y tw o m o r e tim e s , yo u w ill be g iv e n a final w ritten w a r n in g b e fo re te r m in a tio n .

A se c o n d w ritten w a r n in g m i g h t state: •

O n M a y 17, y ou h a d y o u r fifth in s ta n c e o f ta r d in e s s o v e ra ll and y o u r s e c ­ o n d in s ta n c e o f ta r d in e s s sin c e y o u r 9 0 - d a y ta r d in e s s d is c ip lin a ry p erio d w e n t into e ff e c t on A p ril 12, 2 0 0 3 . Y o u a rr iv e d 20 m i n u te s late to w o rk . Y o u w e r e g iv e n a w ritte n w a r n in g fo r y o u r third inc ide nt. T h is n o tic e is to be c o n s i d e r e d y o u r final w ritte n w a r n in g fo r tard in ess . If y o u arc late for w o r k a g a in , y o u will b e d is m is s e d .

T h e third w ritte n w a r n in g m i g h t state: •

O n M a y 23, 2 0 0 3 , yo u h a d y o u r sixth in s ta n c e o f ta r d in e s s in a 3 -m o n th p e rio d w h e n y ou a rr iv e d 30 m in u te s late to w o rk . Y o u w e re g iv e n a w r i t ­ ten w a rn in g fo r y o u r third in c id e n t an d a final w ritten w a r n in g fo r y o u r fifth in c id e n t. It is c le a r th at y o u h a v e n ot tak en y o u r f o r m e r w a r n in g s s e r i­ o u sly . W e are w a iv in g o u r righ t to d is m i s s y o u . If y o u h a v e o n e ad d itio n a l i n c i d e n c e o f u n e x c u s e d ta r d in e s s in the n e x t 90 d a y s, y o u will b e d i s ­ m is s e d fro m w o rk . I f y o u s u c c e s s fu l ly c o m p l e te the 9 0 - d a y d is c ip lin a ry p e rio d , y o u r ta r d in e s s an d a tt e n d a n c e r e c o r d w ill c o n ti n u e to b e m o n i to r e d c lo sely . A n y f u r th e r v io l a ti o n s w ill b e d e a lt w ith v e ry se rio u sly a n d c o u ld b e g r o u n d s fo r d is m issal.

Preventing Problems W h e n T e rm in atin g Em plo ym ent F entin ( 2 0 0 2 ) said th at se v e ra l s u p e r v is o r s (e.g., the d ir e c t s u p e r v is o r o f the e m ­ p lo y e e , the h e a d o f th at s u p e r v i s o r ’s d e p a r t m e n t , the s u p e r v is o r o f all d e p a r t ­ m e n ts , a n d /o r the h e a d o f th e firm ) s h o u ld h a v e a m e e t in g b e fo r e firing an e m p l o y e e to e s ta b lis h w h e t h e r p ro g r e s s i v e d is c ip lin e w a s f o l lo w e d fairly and c o rre c tly . T h is p ro te c ts the e m p l o y e e fro m b e in g fired u n fa irly by a b ia s e d o r in ­ c o m p e t e n t m a n a g e r and p ro te c ts the firm a g a in s t a w r o n g f u l te r m in a tio n suit. H a v in g the m e e t in g p r e v e n t s the e m p l o y e e fro m h e a ri n g d if fe re n t r e a s o n s for b ein g fired fro m d if fe re n t m a n a g e rs .

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M a n a g e r s m i g h t ask the fo l lo w in g q u e s t io n s in the m e e t in g to e n s u r e th a t a t e r m i n a ti o n is fair (B a x te r , 1983b): W h a t is th e e m p l o y e e ’s o v e ra ll r e c o r d ? A re there any m i ti g a ti n g fa c to rs th at m i g h t e x p la i n o r e x c u s e the e m p l o y e e ’s m i s ­ c o n d u c t o r u n s a t is f a c to r y p e r f o r m a n c e ? A re an y sta tu to ry p ro b l e m s in v o lv e d (e.g., r e g a r d in g race, a ge, g e n d e r, e tc.)? W e r e any j o b se c u rity r e p r e s e n ta t io n s m a d e to the e m p l o y e e ? If yes, is th e te r m in a tio n c o n s i s te n t w ith th o s e r e p r e s e n ­ ta tio n s ? A re th ere an y p u b lic p o lic y c o n c e r n s ? H a s the e m p l o y e e re c e iv e d p r o ­ g re s s iv e d is c ip l in e ? Is the te r m i n a ti o n ju s tifie d ? D o c s it fit the o ff e n s e ? H a v e tw o m a n a g e r s p r e s e n t to d o c u m e n t the e n tire c o n v e r s a ti o n w h e n an e m ­ p lo y e e is te r m in a te d . B o th s h o u ld r e c o r d as m u c h o f w h a t the e m p l o y e e say s as p o ss ib le . R e q u ir e the e m p l o y e e to c o n d u c t an ex it in te rv ie w w ith an o m b u d s m a n o r in d e p e n d e n t m a n a g e r n o t in v o l v e d in the te r m i n a ti o n . H a v e the i n d e p e n d e n t m a n a g e r d o c u m e n t the ex it in te rv ie w in as m u c h detail as p o ss ib le . E x it in t e r­ v ie w s p r o v i d e an early w a r n in g o f p o te n tia l h a r a s s m e n t o r d is c r im in a t io n c la i m s a n d /o r m a n a g e m e n t p r o b l e m s that n e e d to be a d d re s s e d (F e n tin , 2 0 0 2 ). A lth o u g h it is d ifficult to fire s o m e o n e w ith o u t d u e p ro c e s s , o n - t h e - s p o t fir­ ing s a re w a r r a n t e d w h e n an e m p l o y e e b r e a k s the la w , e n g a g e s in s u b s ta n c e a b u s e o n c o m p a n y p ro p e r ty , o r e n g a g e s in illegal c o n d u c t, g ro s s i n s u b o r d in a t io n , o r n e g lig e n c e . I f th e re is an y d o u b t, a m a n a g e r ca n s u s p e n d an e m p l o y e e until an in v e s tig a tio n o f the c o n d u c t is c o m p l e te d . T h is a ll o w s tim e to s p e a k to an a tt o r­ ney v e rs e d in la b o r law . P r e v i o u s d is c ip lin a ry a ctio n s m a y also be e x a m i n e d to e n su r e d is c ip lin a ry a c tio n s are fair (F a lc o n e , 1997). E m p l o y e r s m u s t be c o n s c i o u s o f h ow they fire e m p l o y e e s to m i n im iz e the e m ­ p l o y e e ’s fru stratio n , a n g e r, and e m b a r r a s s m e n t . T e ll e m p l o y e e s priva tely w h y the p erso n is b ein g fired as c a n d id ly as p ossib le. B e firm yet c o m p a s s io n a t e w ith o u t b e in g ap o lo g e tic . A n a p o lo g e tic d e m e a n o r m a y s u g g e s t the e m p l o y e r feels guilty an d thu s im p ly w r o n g d o in g to the fired e m p l o y e e . L im it the a m o u n t o f i n f o r m a ­ tion p ro v i d e d to p ro s p e c tiv e e m p l o y e r s ca lling for re f e re n c e c h e c k s o n fired e m ­ p loy ees. P ro v id e o nly the fact an d d ates o f e m p l o y m e n t an d the p o sitio n s held. A v o id p r o v id in g n eg a tiv e in f o rm a tio n b c c a u s c the f o r m e r e m p l o y e e m a y su e if suc h in f o rm a tio n is p u b lic iz e d (B ax ter, 19 83 a, 19 83 b; Z a c h a ry , 2000 ).

The Need for D o c u m en tatio n T h e s e d e ta ile d p e r f o r m a n c e e v a lu a tio n , p ro g r e s s i v e d is c ip lin e , an d te r m in a tio n p ro c e d u r e s s h o w the o b je c t iv e and c o n s i s te n t w ritte n p ro c e d u r e s to d e v e lo p for d e a lin g w ith p o te n tia l legal p r o b l e m s . M a n a g e r s a n d th e ir a tt o rn e y s s h o u ld r e ­ view i m p o r t a n t tr a n s a c t io n s to id en tify p o te n tia l p itfalls. T h e n in c lu d e c la u s e s s p e llin g o u t d e ta ils o f p o s s ib le c o n c e r n in all c o n tr a c ts . F o r e x a m p l e , c o n tr a c ts w ith f r e e la n c e rs s h o u ld be in w ritin g and s ig n e d by b o th parties. In c l u d e fe e s and e x p e n s e s , the w o r k ’s a p p r o p r ia t e s u b j e c t m a tte r, an d w h a t its finish ed form s h o u ld be (R a u c h , 1991).

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D o c u m e n t c o m m u n i c a t i o n s w ith o u ts id e in d i v id u a l s su ch as the p u b lic , in t e r­ v ie w e e s , n e w s so u rc e s, b u s i n e s s c o n ta c ts , a d v e rtis e rs , f r e e la n c e w rite rs, p h o t o ­ g r a p h e r s , an d artists. E s ta b lis h c o m p l a in t p r o c e d u r e s b e c a u s e irate a d v e rtise rs, p u b lic o r p riv a te p e rs o n s w h o are the s u b je c t o f stories, re a d e r s , listen ers, a n d /o r v ie w e rs c o n ta c t m e d i a firm s re g u la rly . T r a in e m p l o y e e s to tre at all c o m p l a in t s serio u sly . In stru c t th em to be p o lite an d c o n c il ia t o ry , ev en if th e y b e lie v e the c o m p l a in t is b a s e le s s , b e c a u s e c o u r t e o u s tr e a tm e n t often d e fu s e s a situ atio n. H a v e e m p l o y e e s tell a c o m p l a i n a n t th a t th e y arc w ritin g d o w n the fa c ts fo r in t e r­ nal in v e s tig a tio n a n d th en d o so, w ith o u t a d m ittin g a n y th in g , in te rru p tin g , or p ass in g b la m e . T h e n b rin g the c o m p l a i n t to the a p p ro p r ia t e s u p e r v i s o r ’s a tt e n ­ tion, e n s u r in g that a p o s s ib ly d e f e n s iv e e m p l o y e e c a n n o t c o m p l ic a t e the situ atio n b y a ctin g a lo n e. T h e s u p e r v is o r s h o u ld d e te r m i n e w h e t h e r the c o m p l a i n t h as m e r it an d then s e n d a lette r c o n fi rm i n g the c o m p l a i n t w a s r e c e i v e d th a t d a y , p r o ­ v id in g an e x p la n a tio n , p r o p o s in g a so lu tio n , o r p ro v i d in g a d e a d li n e by w h ic h the c o m p l a in a n t w ill be c o n ta c te d . U se d if fe re n t p ro c e d u r e s for a s e rio u s c o m p l a in t , w h e n a la w s u i t is t h r e a t­ e n e d , and w h e n th e c o m p l a i n a n t is an atto rn e y . In stru c t e m p l o y e e s n o t to a d m it a n y th i n g a n d i m m e d i a te l y re fe r th e m a t te r to to p m a n a g e m e n t , a lo n g w ith all a v a ila b le d o c u m e n t a ti o n . T o p m a n a g e m e n t m u s t th en c o n ta c t an a tto rn e y b e fo r e r e s p o n d in g an d a llo w the a tto rn e y to h a n d le the p ro b l e m w h e n n e c e s s a ry . In any e v e n t, e m p l o y e e s m u s t feel c o m f o r ta b le a b o u t re p o r tin g c o m p l a in t s to s u p e r v i­ sors, esp ecially c o m p la in ts cau sed by th eir o w n e rro r or m isc o n d u c t. If a retraction o r letter o f ap o lo g y is n e e d e d , an atto rney m u s t rev iew it before d is se m in a tio n . A re tra c tio n c o u ld r e p e a t the o ff e n s e and be v ie w e d as an a d m i s s i o n o f w r o n g d o in g (R a u c h , 1991). M e d i a o rg a n i z a ti o n s s h o u ld p u b lic iz e their p o lic ie s in te rn a lly a n d h a v e tr a in ­ ing s e s s io n s re g a r d in g a p p r o p r ia t e p r o c e d u r e s an d b e h a v io r . N e v e r a s s u m e that all e m p l o y e e s h a v e the j u d g m e n t a n d e x p e ri e n c e to d e a l w ith le g a l a n d e th ic a l d i l e m m a s ; e v e n lo n g - te rm e m p l o y e e s can lose th e ir co o l. T h e b e s t w a y to p r e ­ v e n t legal an d e th ic a l c o n c e r n s is to an tic ip a te c o m m o n p r o b l e m s a n d p re p a re for th em . T h e m e d i a p ro v i d e in f o rm a t io n to the p u b lic ; suc h o rg a n i z a ti o n s m u s t n e v e r fo r g e t the le g a l a n d e th ic a l re s p o n s ib ilitie s that a c c o m p a n y this role.

U nd e rs ta nd in g and Preventing Dis crim in atio n Title VII o f the a m e n d e d C iv il R ig h ts A c t o f 1964 p r o s c rib e s e m p l o y m e n t d i s ­ c ri m i n a ti o n (or tre a tin g an e m p l o y e e u n fairly o r u n f a v o r a b ly ) b a s e d on rac e, r e li­ gio n , g e n d e r, o r n atio n a l o rigin . P ro h i b it e d a c tio n s in c lu d e r e f u s in g to hire e m p l o y e e s b ased on ra c e o r g e n d e r, p ro v i d in g u n e q u a l c o n d it io n s o f e m p l o y ­ m e n t, and p ro v i d in g u n e q u a l p a y fo r the s a m e j o b ( L a c y & S im o n , 1992). M c G il l ( 2 0 0 2 ) r e p o r te d that A m e r i c a n n e w s p a p e r s b e c a m e less d iv e r s e in 2 0 0 0 . M o r e p e rs o n s o f c o lo r left n e w s p a p e r s th a n jo i n e d th e m , d r o p p i n g from

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11.85% to 11.64% o f e m p lo y ees. A t th e sam e tim e, the p e rce n tag e o f peop le of c o lo r in the U.S. pop ulation reached 30% . W h a t does the inability to attract and retain sufficient n u m b e rs o f people o f co lo r say about an industry that reports on d iscrim ination in oth er firms? C o nsider how divergent the view s o f people o f co lor and their co w o rkers are. S eventy-thre e percent o f A frican-A m erican journalists felt that A frican-A m ericans w ere not as likely to be c o n sid ered for c a re e r opp ortun ities, yet only 2% o f n e w s ­ roo m m an ag e rs felt tha t w ay. P erh ap s this is w h y 78% o f A fric a n -A m c ric a n jo u rn a lists felt m a n a g e rs had unrealistic p erc eption s o f them , w h e re a s only 24% o f m a n a g e rs felt th at w ay (M cG ill, 2002). T h ese beliefs o f jo u rn a lists o f colo r d em o n s trate w h y it is so im p o rta n t to im p le m e n t fair and c o nsisten t p erfo rm an ce e valuations. M cG ill (2002) said such perceptual d iscrep an cies indicate that separate c u l­ tures h ave ev o lv ed in n e w sro o m s. In one culture, W h ite m a n a g e rs and jo urnalists think opp ortun ities for a d v a n c e m e n t are equal. In a n o th e r culture, m a n a g e rs and jo u rn a lists o f colo r perceiv e that different stand ard s are being applied to different types o f people. Such p erce ptio ns are rein fo rced w h en people w ithin the W hite m ale m a n a g e m e n t cultu re talk m ostly to others in that sam e culture, neglec ting in teraction with peo ple in o ther cultures. P eop le from different cultures m u s t be able to c o m m u n ic a te their differing p e rcep tio ns with e ach oth er in a supportive e nv iro nm e nt. T he prim ary reasons jou rn alists o f colo r give for leaving the pro fession were c o nsistent o v e r time: lack o f p rofessional challeng e and lack o f a d v a n c e m e n t o p ­ portunities. A lth o u g h pay, quality o f the w o rk env iro n m en t, interpersonal rela­ tionships, and o ther factors are im portant, a d v a n c e m e n t and challen ges m ust be equally available to jo urnalists o f co lor to retain them . P ro m otio ns bring the new duties and ch allen ges that jou rn alists of colo r desire yet feel they m ust w ork h ard er and lon ger than W h ite e m p lo y ees to get. U nfortunately, m o s t jou rn alists of co lor leave the n e w sp a p e r profession feeling disillusioned and d isap po inted— a far cry from the high ideals they held at the b eginning o f their careers (M cGill,

2002 ). M c G ill (20 0 2) said m an ag e rs m u s t find w ay s to pro m o te m o re jo u rn a lists o f c o lo r into profession ally ch allen g in g positions. Such p ro m o tio n s signal an o rg a ­ nizational culture ch a n g e to o th e r e m p lo y e e s o f c o lo r w ho p erceiv e the sam e a d v a n c e m e n t o p po rtu nities for th em selv es. M a n a g e r s m ust c o m m u n ic a te m ore effectively w ith peop le o f co lo r and be open to their different p erceptions. W h ite A m e ric a n s and A m e ric a n s o f c o lo r fo un d th ey lived in tw o d iverg ent w orld s and held very differen t p e rcep tio ns du rin g the O.J. S im p so n trial. M an y o f the sam e types o f issues disc u ssed here regardin g perso ns o f colo r also apply to fem ale em p lo y e e s (see the “F em ale W o r k p l a c e ” section in chap. 2). F or e x a m p le , w o m e n are paid less than m en for the sam e jo b s and receive few er m a n a g e m e n t o pp ortunities. M a n a g e r s m ust u n d ers tan d these different cultures exist and create a positive clim ate c o n d u c iv e to o pen c o m m u n ic a tio n s , fair and

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e q u ita b le p ro m o ti o n s , as w e ll as a p ro d u c t iv e w o rk e n v i r o n m e n t an d j o b s a t is f a c ­ tion f o r e m p l o y e e s o f all c o lo r s an d g e n d e rs . N o t o n ly is this th e rig h t th in g to do, it w ill also e n c o u r a g e w o m e n an d e m p l o y e e s o f c o lo r to r e m a in in m e d ia i n ­ d u strie s an d p re v e n t in c id e n ts o f d is c rim in a tio n .

Using Arbitration to Avoid Legal Problems M a n a g e r s ca n re v i e w the n o n p ro f it A m e r i c a n A rb itra tio n A s s o c i a t i o n ’s ( A A A ) W e b site (h t t p : / / w w w .a d r .o r g ) to d e v e lo p an d i m p l e m e n t a rb itra tio n or m e d i a ­ tion o f d is p u te s . T h e A A A d efin e s a rb itra tio n as s u b m it ti n g a d is p u te to o n e or m o r e im p artial p e rs o n s fo r a final an d b in d i n g d e c is io n . M e d i a ti o n is a p ro c e s s w h e re a ne utral p arty w h o la ck s the a u th o r ity to m a k e a b in d i n g d e c is io n assists the d is a g re e i n g p a rtie s in r e a c h i n g th e ir o w n s e ttle m e n t. A m e d i a firm c o u ld d e v e lo p a d is p u te reso lu tio n plan to in c lu d e in e m p l o y e e h a n d b o o k s and p e rs o n n e l m a n u a ls . T h e plan c o u ld be u sed to settle se x u a l h a r a s s ­ m en t, d is c rim in a tio n , o r w r o n g f u l te r m in a tio n d ispu tes. S e v e ra l prac tical g u ide s, in c lu d in g the B e g i n n e r ' s G u id e to A D R and A G u id e to M e d i a ti o n a n d A r b i t r a ­ t i o n / o r B u s in e s s P e o p l e , are fo u n d on the A A A ’s rules an d p ro c e d u r e s link.

Protecting Employee H ealth and Safety T h e te rro rist a tta c k s o f S e p t e m b e r 11, 2 0 0 1 , c h a n g e d h o w m e d ia firm s a p p ro a c h e m p l o y e e secu rity . M e d i a m a n a g e r s m u s t u p d a te secu rity p ro c e d u r e s at p ri m a ry (e.g., m a i n office d o w n t o w n ) an d s e c o n d a r y lo c a tio n s (e.g., s u b u r b a n o r re g io n a l b u re a u s , sales o ffices, p rin tin g p la n ts, tr a n s m i s s i o n to w e rs , etc .) to e n s u r e e m ­ p lo y e e s are safe an d a v o id leg al p ro b l e m s . E s ta b l is h r e s p o n s ib ility and p r o c e ­ d u re s fo r c o n ti n u a ll y m o n i to r in g an d u p d a ti n g secu rity. A d v is e e m p l o y e e s to c o n s i d e r th e ir p e rs o n a l sa f e ty w h e n d o in g th e ir jo b s . If an e m p l o y e e fee ls u n c o m f o r ta b le c o v e ri n g a sto ry or d o in g the jo b , b e st j u d g ­ m e n t s h o u ld b e e x e r c i s e d to a v o id u n n e c e s s a r y risk ( M a u c k c r , 2 0 0 1 ). P u b lic iz e all s afety p o lic ie s in e m p l o y e e m a n u a l s an d W e b sites. T h e F e d e ra l B u r e a u o f In v e s tig a tio n (F B I) p o s t s in f o rm a t io n a b o u t terro rist th re a ts a n d a d v ic e fo r e n h a n c i n g se c u rity on its W e b site (w w w . f b i . g o v ). M e d i a m a n a g e r s s h o u ld a d o p t the F B I ’s a d v ic e r e g a r d in g s u s p ic io u s le tters a n d p a c k ­ a g e s (F B I A d v is o r y , 2 0 0 1 ). T r a in e m p l o y e e s to lo ok f o r m a il o r p a rc e ls w ith no return a d d re s s , e x c e s s iv e p o s t a g e , m i s s p e l le d w o rd s , in c o r re c t titles, or a d ­ d r e s s e d o n ly to a title, an in c o r re c t title w ith a n a m e , p ro t ru d in g w ire s , lo p s id e d o r u n e v e n sides o r c e n te rs , rigid or b u lk y e x te r io r s , e x c e s s iv e tape o r string , a s tra n g e o d o r, an d ite m s w ith e x te r n a l stain s o r c ry s ta lliz a tio n . H a n d le s u s p ic io u s m ail c a re f u lly w ith o u t s h a k in g o r b u m p i n g it, iso late it fro m o t h e r e m p l o y e e s , le a v e it u n o p e n e d w ith o u t s m e llin g o r ta s tin g it, and then

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call 9 1 1. If the p ie ce is o p e n e d an d a b o m b th r e a t ex is ts, e v a c u a t e th e b u ild in g i m m e d i a te l y , call 9 1 1 , an d c o n ta c t the n e a re s t F B I office. If ra d i o lo g i c a l c o n t a m ­ in a tio n is s u s p e c te d , lim it e x p o s u r e b y iso la tin g an d n o t h a n d li n g the item , s h ie ld in g e v e r y o n e fro m it, e v a c u a t in g the area, a nd c a llin g 911 and the n e a re s t F B I office. If c h e m i c a l o r b io l o g ic a l c o n ta m in a t io n is su s p e c te d , is o late the item w h ile m i n im iz i n g its h a n d li n g , w a s h h a n d s w ith s o a p and w a rm w ater, a n d call 911 an d the n e a re s t F B I office (F B I A d v is o r y , 2 0 01 ). M e d i a firm s h a v e se t up m ail s c r e e n in g lo c a tio n s a w a y fro m th e ir m a in f a c i li­ ties w h e r e so rte rs w e a r g lo v e s , m a s k s , p ro te c tiv e e y e w e a r , a n d /o r p ro te c tiv e c lo th in g . Iso late su s p ic io u s m a il fo r e x a m i n a ti o n late r in a s ecu re e n v ir o n m e n t a n d b a g it im m e d i a te l y to lim it c o n ta m in a t io n . E m p l o y e e s w h o m a y be c o n t a m i ­ n a te d s h o u ld be s trip p e d p riv a te ly , c le a n e d , and d r e s s e d in a p ro te c tiv e suit. Q u a r a n ti n e o th e r e m p l o y e e s w h o h a d c o n ta c t w ith the c o n t a m i n a t e d e m p l o y e e or m ail. S h u t d o w n the v e n tila tio n sy s te m an d lock d o w n the a re a or floor until the c o n ta m in a t io n th reat is o v e r ( M a u c k e r , 2 0 0 1 ). M e d i a firm s h ir e d a d d itio n a l sec u rity p e rs o n n e l to g u a r d b u il d in g e n tr a n c e s an d ex its as w ell as p r i m a r y c o rr id o rs . T a k e digita l p h o to s o f all e m p l o y e e s , e n ­ a b lin g secu rity g u a rd s to a c c e s s a p ic tu re o f an y e m p l o y e e at a b u il d in g e n tr a n c e if sec u rity q u e s t io n s arise. O th e r firm s a d o p te d e m p l o y e e ID b a d g e s o r card s that d o u b le as k e y s fo r o p e n in g d o o rs . E m p l o y e e s m u s t w e a r id e n tific a tio n p r o m i ­ n e n tly an d at all tim e s w h e n at w o rk . A c c e s s to m e d i a facilities is o fte n re s tric te d , and e m p l o y e e s m u s t e sc o r t v is i­ tors. E m e r g e n c y n u m b e r s a re p u b li c iz e d an d drills are held to fa m ilia riz e e m ­ p lo y e e s

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f o r m e d tw o n e w s r o o m S W A T te a m s w h o v o lu n t e e re d to be o n call at all tim e s a n d k e e p th eir ca rs s to c k e d w ith fo o d and w a te r ( M a u c k e r , 2 0 0 1). D e v e lo p a sy s te m to in f o rm e m p l o y e e s in o th e r d e p a r t m e n t s a n d lo c a tio n s w h e n a p o te n tia l th reat o c c u rs . T h e g o a l is to s p r e a d a c c u ra t e in f o rm a tio n q u ic k ly to p r e v e n t in ju ry o r d e ath . T ra in e m p l o y e e s in e v a c u a t io n p r o c e d u r e s a n d e -m a il, in t e rc o m , a n d te l e p h o n e c o m m u n i c a t i o n sy s te m s . D e v e lo p a d d itio n a l l o w -t e c h c o m m u n i c a t i o n p r o c e d u r e s in c a se e - m a il an d p h o n e s y s te m s are d i s ­ r u p te d . S u s p i c io u s p a c k a g e s o r ite m s c o u ld b e q u ic k l y s c a n n e d o r p h o to g r a p h e d d ig itally and then e - m a il e d to all e m p l o y e e s to p r o m p tl y alert o th e r s to po ten tial d a n g e r. D e v e lo p a c o n ti n g e n c y p lan fo r re lo c a tin g o p e ra t io n s , im p l e m e n t i n g b a c k u p p u b lis h in g or b ro a d c a s tin g , and d e a lin g w ith an attack. F o r e x a m p l e , if an attack o c c u rs , h a v e d aily c o n fe r e n c e calls w ith c o m p a n y m a n a g e m e n t to sh are in f o r m a ­ tion, c o n c e rn s , an d stress c o m m u n ic a t io n . H a v e the firm ’s c o m m u n ic a t io n s office issue r e g u l a r n e w s an d secu rity u p d a te s to e m p l o y e e s . H o ld r e g u l a r e m p l o y e e f o ­ r u m s to e x p la in w h a t is h a p p e n in g a n d se c u rity p re c a u t io n s to o b s e r v e (M a u c k e r , 2 0 0 1 ). F in a lly , m e d i a o u tle ts m i g h t a d v is e r e a d e r s or v ie w e r s a g a in s t s e n d i n g a n o n y ­ m o u s or u n m a r k e d m a il to a v o id c o m p l a in t s o r la w s u its fr o m failin g to r e s p o n d .

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Tell the public to inclu de a n am e, address, te lep h o n e n u m b e r, an d /o r e-m ail a d ­ dress in all co rr e sp o n d e n c e (M au ck er, 20 01 ). Im p le m e n tin g p ro ced u res like these m in im izes potential risks for e m p lo y e e s and potential legal actions resu lt­ ing from sabotage, disasters, o r d isgru ntled m e m b e rs o f the public. M a n a g e r s face a m u ch larger variety o f health and safety co n ce rn s on the jo b than discussed here. T he im p o rta n c e o f k eep ing up w ith regulations (such as the A m e ric a n s W ith D isabilities A ct) and c on sulting with the ap p ro p riate legal e x ­ pert for a d vice c an n o t be o v erem p h a sized .

Avoiding Problems Related to Pornography and Obscenity E v o lv in g tec h n o lo g y has created new legal p ro b le m s for m edia m a n a g e rs re g a rd ­ ing po rn o g rap h y . M ed ia firms creating or spon sorin g W e b sites, bulletin boards, and ch at ro o m s m u st exercise care w h en loading m aterial to and from th eir sites, allo w in g th ird-party access, selling m aterials online, and allow in g e -m ail to be transm itted. O b scen ity is not protected by the First A m e n d m e n t, and child p o rn o g r a p h y is u n pro tec ted so re m o v e both im m ed ia tely if found a n y w h e re on a site (Delta & M atsu ura, 2002). S p ecial p ro b le m s arise b ec au se the In tern et “k n o w s no b o rd ers,” yet o b s c e n ­ ity is defined by co n te m p o ra ry c o m m u n ity standards. N e v e r a ss u m e that sexual m aterials are not o b sc e n e in so m e ju risd ictio n and forbid the postin g o f such m a ­ terials. E n sure th at e m p lo y e e s w h o op erate and m aintain c o m p u te r system s are aw are o f w h o accesses the firm ’s W e b site. D elta and M a tsu u ra (2002; see A p p en d ix 12) adv ised firms to m o n ito r the c o n ten t o f W e b sites, bulletin bo ards, and chat ro o m s and e n a ct sub scrib e r a g r e e ­ m en ts that p erm it a firm to m o n ito r and re m o v e in app ro priate content. H ave su b ­ scribers, co n ten t prov iders, and others with access sign con tracts o r co m p lete opt-in a g reem en ts that they will not upload sexual or o th er objectio na ble m a te r­ ial. E nsure that e m p lo y e e s w ith the responsibility m o n ito r all W e b co nten t closely and carefully and report all qu estion ab le material to the app ro priate m a n ­ a g e r as soon as it is found. S u ch e m p lo y e e s should be inform ed o f w hat types of m aterial to im m ed ia tely delete w h en discovered.

Problems Related to Electronic Access to Governm ent Information M e d ia org a n izatio n s m ay obtain g o v e rn m e n t info rm ation using the F reedo m o f Inform ation A ct (F O IA ), w hich estab lishe d a pro cess for req uestin g inform ation from federal agencies. T h e F O IA did not ad dress electronic data, bu t w as su b s e ­ qu ently interpreted to pro v id e access to c o m p u t e r records. F O IA obligations apply w h en existing search engines at a federal agen cy can retrieve the requested data using a reasonable effort. The form in w hich electronic records are disclosed

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is n ot sp ecifie d , and a n o t h e r e q u iv a l e n t m e d i u m m a y be u sed . C o u rts h a v e fo u n d m ic ro fic h e an d p a p e r to be e q u iv a l e n t fo r m s to c o m p u t e r r e c o r d s (D e lta & M a t s u u r a , 2 0 0 2 ). A n o t h e r a c c e s s issu e is w h e t h e r so f tw a re th a t a fe d e ra l a g e n c y d e v e lo p e d can b e o b ta i n e d u sin g F O I A p r o c e d u r e s . A sig n ific an t fa c to r is w h e th e r a c c e s s to the s o f tw a re is n e e d e d to use the r e q u e s te d e le c tro n ic re c o rd s. W h e n the fe deral a g e n c y in te n d e d the d a ta b a s e o r so f tw a re for p u b lic sale, th e F O I A will n ot p r e ­ v e n t it. T h is is su e is lik ely to arise as m o r e f e d e r a l d ata an d s o f tw a re are g e n e r ­ ated and th e ir e c o n o m i c v alu e is re c o g n i z e d (D e lta & M a t s u u r a , 2 0 0 2 ). H a le ( 2 0 0 1) said th at, a lt h o u g h m e d i a o r g a n i z a ti o n s ca n a ffo rd the co sts o f a c c e s s in g d a ta b a s e s , the p u b lic w o u ld be u n a b le to a ffo rd s u c h fees. U n d e r the F O I A , e -m a il m e s s a g e s tha t are c o n s i d e r e d p u b lic r e c o r d s are s u b ­ j e c t to d is c lo s u r e re q u i r e m e n ts . A r c h iv e d , p rin te d , o r re a d ily a c c e s s ib l e e -m a il m e s s a g e s are m o r e lik ely to be trea ted as p u b lic re c o r d s . M e s s a g e s akin to p e r ­ s o n al an d co n fid e n tia l te l e p h o n e c o n v e r s a ti o n s are u n lik ely to be s u b je c t to d i s ­ c lo s u re (D e lta & M a t s u u r a , 2 0 0 2 ). M a n a g e r s s h o u l d r e c o g n i z e th at e -m a il d o c u m e n t s are c o n s i d e r e d re c o r d s fo r litigation p u r p o s e s and e s ta b lis h d is c lo s u r e a n d r e te n tio n p o lic ie s at th e ir m e d i a firm s (F ra y e r, 2 0 0 2 ). A c c e s s is su e s also in v o lv e s afety an d secu rity . A f te r th e S e p t e m b e r 11, 2 0 0 1 , terro rist a tta c k s, fe d e ra l a g e n c i e s r e m o v e d in f o rm a t io n fro m In te rn e t sites that m i g h t h e lp terro rists p la n fu tu re a ctio n s. P ip e l in e - m a p p i n g d a ta w e re r e m o v e d fro m the D e p a r t m e n t o f T r a n s p o r t a t i o n ’s site, in f o rm a t io n a b o u t h a z a r d o u s m a t e ­ rial sites w a s ta k e n o f f the E n v i r o n m e n t a l P ro te c tio n A g e n c y ’s site, an d a stud y on p o te n tia l c h e m i c a l te r ro rism w a s e li m i n a te d by th e C e n te r s fo r D is e a s e C o n ­ trol (Z ip p . 2 0 0 2 ). F u tu r e m e d i a m a n a g e r s w ill be f a c e d w ith this q u e s tio n : Is p u b li s h i n g this sen s itiv e m a t e ri a l w o r th p o s s ib ly je o p a r d iz i n g p u b lic sa fe ty ? M e d i a m a n a g e r s a n d e m p l o y e e s m a y find th e m s e l v e s in the m i n o ri ty w h e n ta k in g a stan d fo r ac c e ss . In O c t o b e r 2 0 0 1 , A tto r n e y G e n e r a l J o h n A s h c r o f t d i ­ r ected f e d e r a l a g e n c i e s to res ist F O I A re q u e s ts w h e n th ey find a s o u n d legal b asis fo r d o in g so. F e d e ra l a g e n c i e s w e r e fo r m e r l y u n d e r a p r e s u m p ti o n o f d i s ­ c lo s u re , res istin g re le a se o n ly w h e n the re q u e s te d d o c u m e n t s c o u ld p o te n tia lly h a rm a legal interest. T h e n e w e r, m o r e re s trictiv e s ta n d a rd w a s in s titu te d to s a f e ­ g u a r d n atio n a l se cu rity , p ro t e c t sen s itiv e c o m m e r c i a l in f o rm a t io n , an d p ro te c t p e rs o n a l p riv a c y (Z ip p , 2 0 0 2 ). T h e s e a d d itio n a l p ro t e c ti o n s lay the fo u n d a tio n fo r p o te n tia l a b u s e s o f f r e e d o m o f a c c e s s in the fu ture. U n p o p u l a r jo u r n a li s ti c stan d s fo r o p e n a c c e s s are f o u n d in the p u b lic a r e n a as w ell. A F lo r id a law p a s s e d afte r the d eath o f s to c k - c a r r a c e r D a le E a rn h a rd t m a k e s a u to p s y p h o to s p r i v a te — to be r e l e a s e d on ly by a j u d g e ’s o rd e r. A j u d g e d e c id e d th at re l e a s i n g the a u to p s y p h o to s w o u ld i n v a d e the p riv a c y o f E a r n ­ h a r d t ’s w id o w an d se a le d th em at h e r re q u e s t. T h e O r l a n d o S e n tin e l tried in c o u rt to u n s e a l the p h o to s . T h e r e s u ltin g p ro te s t fr o m r a c in g fans led le g isla to rs to m a k e all a u to p s y p h o to s p riv a te (Z ip p , 2 0 0 2 ). T h e m e d i a m u s t e d u c a t e the

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p u b lic a b o u t the n eed to p ro t e c t a c c e s s to g o v e r n m e n t in f o rm a t io n b e fo r e a c c e s s e ro d e s fu rth e r.

D eceptio n in Advertising M a n a g e r s m a y n e e d to train e m p l o y e e s to c le a r or re v ie w a d v e rt is i n g to d e t e r ­ m in e w h e t h e r it is d e c e p t iv e o r o ff e n s iv e to the a u d ie n c e . S e c ti o n s 5 an d 12 o f the F e d e ra l T ra d e C o m m i s s i o n ( F T C ) A c t o f 1914 g iv e th e F T C the p o w e r to r e g u la te d e c e p t iv e a d v e rt is i n g an d o th e r u n fa i r ac ts or p ra c tic e s . If an a d v e rtis e r is in ju re d by a c o m p e t i t o r ’s m i s l e a d in g ad, it m a y su e u n d e r S e c tio n 4 3 ( 1 ) o f the L a n h a m A c t, w h ic h p r o v i d e s p ro te c tio n for tr a d e m a r k s . D e c e p ti o n u n d e r the L a n h a m A c t is d efin e d as any false o r m i s l e a d in g d e s c r ip ti o n o r re p r e s e n ta tio n o f fa c t (G illm o r, B a rro n , & S im o n , 1998; P re s to n , 1994, 1996). T h e c u rr e n t F T C definition o f d e c e p tio n is: (a) T h e re m u s t be a re p r e se n ta tio n , o m is s io n , o r p ractic e th at is likely to m is le a d the c o n s u m e r ; (b) the re p re se n ta tio n , o m is s io n , o r p ra c tic e is e x a m i n e d from the p e rs p e c tiv e o f a c o n s u m e r a c tin g r e a ­ s o n a b ly in th e c ir c u m s t a n c e s to th e c o n s u m e r ’s d e tr im e n t; an d (c) the re p r e s e n ta ­ tion, o m is s io n , o r p ra c tic e m u s t be a m a te ria l o n e (P o licy S ta te m e n t o f D e c e p tio n , 1983). R ic h a rd s (1 9 9 0 ) said, “ re g u la b le d e c e p t iv e n e s s results on ly if p u rc h a s e b e h a v io r o f a s u b s ta n tia l n u m b e r o f p e o p le is likely to b e a ff e c te d ” (p. 24). D e c e p ti v e c la i m s o r p ra c tic e s in c lu d e false v e rb a l o r w ritte n s t a te m e n ts , m i s ­ le a d in g price c la i m s , sellin g d a n g e r o u s o r d e fe c tiv e p ro d u c t s w ith o u t a d e q u a t e d is c lo s u r e s , n o t d e li v e ri n g p r o m is e d se rv ic e s, an d failin g to m e e t w a r r a n t y o b l i g ­ a tion s. T h e F T C c o n s i d e rs w h e th e r the entire ad is likely to m is le a d r e a s o n a b le c o n s u m e r s so e v e n if all o f an a d ’s c la i m s are tr ue, if the g e n e r a l im p r e s s io n o f the ad is false, it still m a y be d e c e p t iv e ( P o lic y S t a t e m e n t o n D e c e p ti o n , 1983; P re s to n , 1994). T h e F T C said certain p ractic es are not likely to d e c e iv e re a s o n a b le c o n s u m e rs . F o r e x a m p l e , m isre p r e s e n ta tio n s a b o u t in e x p e n s iv e p ro d u c ts th a t arc e v a lu a te d easily an d p u rc h a s e d fr e q u e n tly by c o n s u m e r s are o f less c o n c e rn b c c a u s c these a d v e rtise rs d e p e n d o n r e p e a t sales for su rv iv al. T h e F T C u su a lly d o e s n o t p u rs u e c a ses b a s e d on p u ffe ry o r c o rre ctly stated an d h o n e stly he ld o p in io n s a b o u t a p ro d u c t, o r o b v io u s e x a g g e r a t io n s a b o u t the p r o d u c t o r its q u a lities (e.g., the best o r g reate st; P olic y S ta t e m e n t on D e c e p tio n , 1983; P res to n , 1996). N e w s p a p e r s , m a g a z in e s , b r o a d c a s t sta tio n s, c a b le c h a n n e l s , In te rn e t sites, and so on can s creen a d s p ri o r to p u b lic d is s e m i n a ti o n to e n s u r e th e y are n o t d e c e p ­ tive o r o ff e n siv e . M e d i a o u tle ts m a y e sta b lish their o w n c l e a ra n c e c o d e s on h ow to re v ie w a d s for d e c e p t iv e c o n te n t a n d a v o id o ff e n d in g th eir p a rt ic u l a r a u d i ­ e n c es. T h e F T C p r o v i d e s its A d v e rti s in g P o lic y S ta t e m e n t s an d G u id a n c e ( w w w . f t c .g o v / b c p / g u i d e s / g u i d e s .h t m ) an d S c r e e n i n g A d v e r ti s e m e n ts : A G u id e fo r the M e d i a ( w w w . f t c .g o v / b c p / c o n l i n e / p u b s / b u s p u b s / a d s c r e e n . h t m ) to e d u c a t e m a n a g e r s a b o u t e ff e c tiv e ly r e v i e w i n g ad s f o r m i s l e a d in g c o n te n t.

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REGULATORY A N D SELF-REGULATORY ON LIN E RESOURCES FOR MANAGERS T h e re are m a n y o th er W e b sites with useful inform atio n for m edia m anagers. T h e Internet L aw Library prov id es access to U.S. federal and state law s, as well as so m e international laws and treaties (h ttp ://w w w .la w g u r u .c o m /ila w lib /). T h e U.S. C o d e can be searched online (u s c o d e .h o u s e .g o v /u s c .h tm ). M o s t federal ag en cie s are accessed at T h e F ed eral W e b N a v ig a to r (la w d ba se.law .villa no va . ed u/fe dw eb /). F ed eral W e b sites can be ex a m in e d for specific a dv ice o f in terest to m edia m an ag e rs. T h e U.S. E qual O p p o rtu n ity C o m m is s io n (h ttp ://w w w .e e o c .g o v ) has a quick start link w h ere e m p lo y e rs can learn about federal eq u al e m p lo y m e n t law s (w w w .eeo c.g o v /q s-e m p lo y e r s.h tm l) and a link for law s, regulations, and policy g u id a n c e (w w w .eeo c.g o v/p o licy/in d ex.h tm l) . T h e F ederal E m e rg e n c y M a n a g e ­ m e n t A g e n c y ( w w w .f e m a .g o v ) o ffers ad vice for plan n in g and p rep arin g for dis­ asters (w w w .fe m a .g o v /lib r a r y /p r e p a n d p r e v .s h tm ). T h e So ciety o f P ro fe ssio na l Jou rn alists (SPJ; h ttp ://w w w .s p j.o rg ) has an F O IA R eso u rce C en te r (w w w .sp j.o rg /fo ia .a sp ) to help jo u rn a lists and n o n jo u r­ nalists in obtain ing inform atio n from federal and local g o v e rn m en ts. T h e S P J ’s diversity link (w w w .sp j.o rg /d iv e rs ity .a sp ) offers exp ertise on civil rights, g a y / lesbian issues, and g e n d e r issues. T h e N ational A ssociation o f Black Journalists (N A B J; h ttp ://w w w .n a b j.o r g ) p ro v id e s in fo rm atio n abo ut issues c o n c e rn in g jo u rn alists o f c o lo r and a M ed ia R eso u rce C en ter (w w w .n a b j.o r g /h tm l/m e d ia r s r c s .h tm l). T h e A sian A m e ric an Jou rn alists A ssociatio n (A A J A ; w w w .a a ja .o r g ) includes a link on G u ides for C ov erin g A rab A m e ric a n s and S ou th A sian s as well as a m ed ia w atch and in d u s­ try n e w s reports. T he N atio n al A ssoc iatio n o f H isp anic Jo urnalists (N A H J; w w w .n a h j .o r g ) pro vides a link to p urch ase its L atin os in the U nited States: A R e ­ source G uide for Journalists and explain its m ission and goals (w w w .n a h j.o rg / mission.htm l). The N ativ e A m e ric an Jou rn alists A sso cia tion (N A J A ; w w w .n a j a . org ) publish es its d o w n lo a d a b le R e ad in g R ed R ep ort on N ative A m e ric a n s in the N e w s ( w w w .n a ja .c o m /r e d .h tm l). T he N a tio n al L esb ian & G ay Jou rn alists A s s o ­ ciation (w w w .n lg ja .o r g ) offers H IV /A id s inform a tion links for jo u rn a lists (w w w .n lg ja .o rg /n e w s/a id slin k s.h tm l). T he D etroit F ree Press p u b lished 100 Q uestio ns and A n sw e rs A b o u t A rab A m erica n s: A Jo u r n a lis t’s G u id e (w w w. fr e e p .c o m /jo b s p a g e /a r a b s .h tm ) . T h e R e po rters C o m m itte e for F re e d o m o f the Press (h ttp ://w w w .r c fp .o r g ) re­ ports on legal actions re g ard in g press fre e d o m s and has links to the First A m e n d ­ m e n t H an d b o o k and the N e w s M e d ia & T he L a w . T h e Libel D efense R eso urce C e n te r (w w w .l d r c .c o m ) m o n ito rs First A m e n d m e n t rights in libel, p rivacy, and o th er legal areas. E d ito r & P ub lisher (w w w .e d ito r a n d p u b lis h e r .c o m ) has legal articles and a d atab a se ( w w w .e d ito r a n d p u b lis h e r .c o m /e d ito r a n d p u b lis h e r / b u sin e ss _reso u rce s/m ed ia lin k s.jsp ).

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T h e N e w s p a p e r A ssociation o f A m e ric a (N A A ; h ttp ://w w w .n a a .o r g ) pro vides in fo rm a tion on the n e w s p a p e r industry and publish es P res stim e (w w w .n a a .o r g / p res stim e /) and T e c h N e w s ( w w w .n a a .o r g /te c h n e w s /) m ag az in es online. T h e N A A has a G o v e rn m e n t and L eg al Affairs link w ith in form atio n on em p lo y e e re ­ lations, g o v e rn m e n t affairs, legal affairs, and postal affairs, as w ell as links to the W h ite H ouse, U.S. H o u se o f R ep resen ta tiv es, and U.S. Senate. T h e R ad io-T elev ision N e w s D ire c to r’s A ssociatio n (h ttp ://w w w .r tn d a .o rg ) has F reed o m o f In fo rm atio n and R esearch links and pub lishes its C o d e o f Ethics online (w w w .rtn d a .o rg /e th ic s/c o e .s h tm l). T h e N atio nal A ssoc iatio n o f B ro a d ­ casters ( w w w .n a h .o r g ) inclu des links entitled Legal & R eg ula tory A ffairs, Science & T e c h n o lo g y and R esearch & In fo rm atio n. E lectro nic c o m m u n ic a tio n s m a n a g e rs can stay abreast o f the Federal C o m m u n ic a t io n s C o m m is s io n s ’ (F C C ; w w w .f e e .g o v ) activities and priority issues. T h ere also is a m ed ia o w n e rsh ip link (w w w .fc c .g o v /o w n e r s h ip /), a c o n tin u in g priority issue for the FCC. C o lu m b ia Jo urn alism R ev iew (C JR ; h ttp ://w w w .c jr.o rg ) pro vid es R esou rce G u id es and reports on a variety o f subjects (w w w .c jr .o r g /r e s o u r c e s ). C JR p ro ­ vides W h o O w n s W hat, a guide to w ha t m ajo r m e d ia c o m p a n ie s o w n ( w w w .c jr . o rg /o w n ersf). T h e N ation al Press P h o to g r a p h e r’s A s s o c ia tio n ’s (N P P A ; www. n ppa.org) C ritical Incident R esp o n se T e am (w w w .n p p a .o rg /servic es/cirt/ default, htm ) provides inform ation on how to deal w ith tr aum atic incidents on the job . T h e F ederal T rade C o m m is s io n (F T C ; h ttp ://w w w .ftc .g o v ) pro vides in f o rm a ­ tion ab ou t the F T C in general as well as n ew s releases dis cussin g recent a d v ertis­ ing d eceptio n cases and c o n s u m e r and busin ess pu blicatio ns (w w w .ftc .g o v /ftc / c o n su m e r.h tm ). T he F T C p ublicizes its privacy initiatives (w w w .ftc .g o v / priva cy/ind ex, him I) online. It has a K idz P riv acy p ag e (w w w .ftc .g o v /b c p /c o n lin e / ed c a m s /kid zp riva cy /in d e x.h tm I) w ith d o w n lo a d a b le in fo rm a tion on ho w to c o m ­ ply w ith the C h il d r e n ’s O n lin e Privacy P rotection A c t (w w w .ftc .g o v /b c p /c o n lin e / ed c a m s/kid zp riva cy /b iz.h tm ). T h e se links pro v id e g oo d ad vice on d ev elop in g W e b p ages th at safeg uard the onlin e privacy o f children. T h e C o n s u m e r P ro d u c t Safety C o m m is s io n (C P S C ; w w w .c p s c .g o v ) pro vides in form atio n abo ut p ro d u c t safety an d recalls. T h e C P S C K id ’s P ag e ( w w w .c p s c . g o v /kid s/kid sa fety/in d ex.h tm l) inclu des safety tips and pro vid es a g o o d e x a m p le o f a public service h o m e p a g e for children. T h e C ou ncil o f B etter B u sin ess B u reau s (C B B B ; h tt p ://w w w .b b b .o r g ) re­ v iew s dispu te resolution as well as how to advertise legally and ethically for local and national advertisers and agencies. T h e C B B B ’s B u sin ess G u id an ce page (w w w .b b b .o r g /s u b p a g e s /b iz s u b p g .a s p ) has links to its self-regulatory p r o ­ g ram s on online privacy, onlin e reliability, and advertising. Surfing the C B B B ' s A dv ertisin g R ev iew P ro g ra m s (w w w .b b b .o r g /s u b p a g e s /a d s u b p g .a s p ) en ables m a n a g e rs to keep cu rren t with its national ad vertisin g self-regulatory bo dies, the N atio nal A dv ertisin g D ivision (N A D ), and the N ation al A d ve rtisin g R ev iew B oard (N A R B ). T he N A D investigates the truthfulness and accu racy o f national advertising. T h e N A R B is the appeals board for adv ertise rs o r cha llen gers w ho

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d isagree w ith N A D decisions. F or local advertisers and others, the C B B B ' s a d ­ vertising g u idelines p ro v id e in form atio n fo r advertise rs and ag e n c ies to use w h en question s arise as to w h e th e r an ad claim o r te c h n iq u e is ethical. T h e C h il d re n ’s A d vertising R ev iew U nit (C A R U ; h ttp ://w w w .c a r u .o rg ) o f the C B B B rev iew s ad vertisin g d irected to children. It pub lishes the C A R U SelfRegulatory Guidelines for Children’s Advertising online (w w w .ca ru.org/cantsubpgs/ g u id ep g .a s p ) to prov ide adv ice on adv ertising to children ethically and a c c u ­ rately. C A R U ’s S afe H a rb o r P ro g ram ( w w w .c a ru .o r g /c a ru s u b p g s/lia r b o rp g .a sp ) o ffers in fo rm atio n on protecting the privacy o f ch ildren online. T h e A m e ric a n A d v ertisin g F e deratio n (http ://w w w .a a f.o r g ) has a g o v e rn m e n t affairs link with in fo rm atio n on ad vertisin g regulation and self-regulation. The A m e ric an A ssociatio n o f A d v ertisin g A g e n c ies ( A A A A ; w w w .a a a a .o r g ) in ­ clu des a W a sh in g to n S c en e link with g o v e rn m e n t reports and r e c o m m e n d a tio n s reg ard in g advertising. Search for the A A A A ’s Stan dards o f P ractice to guide a d ­ vertisers and ag encies at its W e b site. T h e Public R elation s Society o f A m e ric a (w w w .p r s a .o r g ) pro v id es b a c k g ro u n d inform ation on the public relations in d u s­ try (w w w .p r s a .o r g /_ R e s o u r c e s /m a in /) and pub lishes its C o d e o f Ethics and P r o ­ fessional S tand ards (w w w .p rs a .o rg /_ A b o u t/e th ic s/) online. T h e D irect M a rk e tin g A sso cia tio n (D M A ; http://w w w .the-clm a.org ) has e th i­ cal gu idelin es for direct m arketers (w w w .th e -d m a .o r g /lib r a r y /g u id e lin e s ). T h e D M A offers inform ation about privacy issues (w w w .th e -d m a .o r g /lib ra r y/p riva cy / index, shtm l) and g o v e rn m e n t affairs ( w w w .th e -d m a .o r g /g o v e r n m e n t/in d e x . shtml). T h e Interactive A dv ertisin g B ureau (IA B ; w w w .ia b .n e t) pro vid es re­ search and advice abo ut online advertising. It publish es stand ard s, including th o se fo r in teractive a dvertising units (w w w . i a b .n e t/ia b _ b a n n e r _ s ta n d a r d s / b an nerso urce. htm l). T h e IA B has a priv acy link th at in c lu d e s g uid elin es, a reso urce center, and its p rivacy policy ( w w w .ia b .n e t/p riv a c y /in d e x .h tm l). T h ere are m a n y oth er ind ividu als, orga niz atio ns, and agen cies online that p ro ­ vid e in fo rm a tion , research , an d /o r a lternative v iew p o in ts o f the variou s m edia in­ dustries and th eir influence on socicty. C ornell U n iv e rs ity ’s Legal In form ation Institute (h ttp ://w w w .la w .c o r n e li.e d u /) in clud es in form atio n on S u p re m e C o urt decisio ns and legal even ts in the new s. T h e A m e ric a n A rb itration A sso c ia ­ tion (h ttp ://w w w .a d r .o r g /in d e x 2 .1.jsp) p ro v id es in fo rm ation and gu idelin es (w w w .a d r .o r g /i n d e x 2 .1,jsp ?JSP ssid = 1 3 7 5 8 & J S P a i d = 3 2 2 2 9 ) as well as statespecific rules (w w w .a d r .o r g /i n d e x 2 .1 .js p ? JS P s sid = 1 38 07 ) on conflict m a n a g e ­ m e n t and dispute resolution. T h e U.S. C e n su s B ureau (h ttp ://w w w .c e n s u s .g o v ) prov ides d e m o g r a p h ic p r o ­ files (w w w .c e n s u s .g o v /P r e s s -R e le a s e /w w w /2 0 0 2 /d e m o p r o file s .h tm l) and a search en g in e (w w w .c e n s u s .g o v /m a in /w w w /s r c h to o l.h tm l) to find specific data. T he C enters for D isease C o n tro l and Prev entio n (w w w .c d c .g o v ) offers statistical in ­ fo rm atio n and reports ( w w w .c d c .g o v /sc ie n tific .h tm ). T he Pew R esearch C en ter (http ://p e o p le -p re ss .o rg ) p ro v id e s a forum fo r ideas as well as research and datasets on the m ed ia and public policy.

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C o m m e rc ia l A le rt (w w w .c o m m e r c ia la le r i.o r g ) aim s to protect the public and children from ex plo itation by the c o m m e rc ia l culture. A d b u sters (w w w . ad b u siers.o r g ) offers a critical p ersp ective on advertising. T he C e n te r for M edia Literacy (w w w .m e d ia lit.o r g ) aim s to teach ch ildren and adults a b o u t the m edia that surro un d them and has links to m edia literacy and m edia-related sites ( w w w .m e d ia lit.o rg /o th e rsite s.h tm l). T h e M ed ia R esea rch C e n te r ( w w w .m r c .o r g ) offers the p ersp e ctiv e o f those w h o believ e the m ed ia has a liberal bias. T h e P o y n tc r Institute (http ://w w w .p o in te r.o r g ) prov id es m a n y links and infor­ m ation on being a better jou rn alist. A J o u r n a lis t’s G u id e to the Internet (re p o rter .u m d .ed u ) offers a variety o f legal and reg ulatory links. Jo u r n a lis m N e t ( w w w .jo u r n a lis m n e t.c o m ) has a variety o f m e d ia and jo u rn a lism -re la te d links.

SUMMARY M e d ia law , reg ulatio n, and self-regulation are o b v io usly c o m p le x and in v olv e m u c h m ore th an w h at w a s discu sscd in this chaptcr. P ru d en t m ed ia m a n a g e rs should review the so urces cited in this chaptcr, as w ell as o th er ap prop riate sources and co u n sel, to k eep ab reast o f the e v e r-c h a n g in g law s, cthical stan­ dards, and professio nal and ethical issues affecting m e d ia firms. M a n a g e r s w h o fail to keep up with the law risk legal p ro b le m s and law suits.

IN T R O D U C T I O N A lth o u g h cases w ith Internet c o m p o n e n ts are in clu d ed here, D elta and M atsu u ra (2002) pro vided a g oo d resou rce for d e velo pin g y o u r o w n case or learning m o re ab ou t legal issues reg ard ing the Internet. D elta and M a tsu u ra (2 00 2) inclu ded a p ­ p en d ix es w ith advicc on han d lin g a variety o f Internet legal co n ccrn s for m a n ­ agers such as G u id elin es for H a n d lin g P erso na l D ata (p. A pp . 1-1), E lectronic R eco rd s M a n a g e m e n t C h e c k list (p. A pp. 2-1), N e tw o rk U se an d Security G u id e ­ lines (p. App. 3-1), W e b Site N o tic e /D isc la im e r C h e ck list (p. App. 4-1), C h e c k ­ list for Link L icenses (p. A pp. 5-1), W o rld W id e W e b Site D e v e lo p m e n t A g re e m e n t (p. A pp. 6-1), M od el E lectronic D ata Interchan ge T rad in g Partner A g re e m e n t and C o m m e n ta ry (p. App. 7-1), E - C o m m e rc e B u sin e ss Practice G uid elin es (p. A pp . 8-1), O n -L in e C o n ten t M a n a g e m e n t C he cklist (p. App. 9-1), G uid elin es for M a n a g in g O n -L in e Conflicts (p. App. 10-1), A v o id in g P ro b lem s C au sed by O b sc e n e and Indecent M aterials (p. A pp . 12-1), and M in im iz in g P o ­ tential L iability from Internet O p eratio n s (p. App. 14-1). P ro fessors and students are e n c o u ra g e d to read th ese a p p e n d ix e s and discuss the m a jo r p ro b lem s and solutions for W e b page d e v e lo p m e n t and im p le m e n ta ­ tion by m edia organ izatio ns. F o r e x a m p le , students could read the ap p en d ix e s,

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e x a m in e the W e b site o f a p ro m in en t local or national m edia outlet assig ned by the professor, and discuss in the next class w h e th e r the outlet has any existing or p otential legal p ro b lem s with its W e b site. H av e stu d ents read th ese a pp end ixe s and then search da taba ses like A B I I n f o rm /P ro Q u e s t and L ex is-N e x is A c a d e m ic U n iv e rse to find ex a m p le s o f m edia firms hav ing In ternet legal difficulties. E ach s tu d e n t could w rite a p ap er e x plainin g the case, how the outlet han dled the Inter­ net legal problem correctly or incorrectly, w h at the ou tlet sh ou ld h ave done and co uld do in the future to correct and p rev ent such p ro blem s, and w rite an outline o r fact sh eet sh o w in g o th er m edia m a n a g e rs how to deal w ith the p ro blem . E ach stu d en t cou ld bring in their p ap ers and fact sheets to turn in and discu ss in class to d evelo p overall gu id elin es for dealing with c o m m o n In ternet legal problem s. Stu d en ts could use a real-life p rob lem found in the d atab a se search to dev elo p an original case with an outline o f co rre ct answ ers. T h e case could be d e v e lo p e d to­ g eth er as a class o r w ritten in d ividually by students. B ecau se law s invo lvin g the Internet and o the r asp ects o f the m ed ia c han ge often and regularly, students and pro fessors co uld lo ok for new so urces o f a d ­ vice. L o o k fo r g uid elin es or a p p e n d ix e s sim ilar to th o se d e v elo p e d by D elta and M atsu u ra (2002). T h e se new sources also cou ld be used in the w a y s d escrib ed previously.

Case 6.1 Developing Counterterrorism Plans and Procedures

D ev e lo p a plan and p ro ce d u res for protecting e m p lo y e e health and safety in the e v e n t o f a terrorist attack. Select a m ed ia outlet in the n earest m ajo r city (that d oes n ot already h av e such a plan on its W e b site) and d ev elo p a plan and p ro c e ­ dures. If possible, h av e y o u r professor arrang e a visit to a m ajo r m e d ia outlet to learn a b o u t security p ro cedu res. Start by rereadin g the section o f the ch a p tc r on e m p lo y e e health and safety. T h e n read the fo llow ing online sources, m ak in g notes or printing sections that state and describe w h a t pro ced u res to im p lem e n t in an em e rg e n c y o r terrorist attack. R ev iew the F E M A F act Sheet: T errorism (http ://w w w .fe m a .g o v /h a za rd s /te r ro rism /te r ro rf.sh tm ) and B a c k gro u nd er: T e r ­ rorism (w w w .fe m a .g o v /h a z a r d s /te r r o r is m /te r r o r .s h tm ). R eview the C D C ’s Fact Sheets Facts A b o u t A n thrax (w w w .h t.c d c .g o v /D o c u m e n ts A p p /F a c tS h e e t/ A n th ra x /a b o u t.a s p ) and U p d a ted In fo rm atio n A b o u t H ow to R eco g n ize and H and le a S u spic iou s P ack ag e or E n v e lo p e (w w w .b t .c d c .g o v /D o c u m e n t s A p p / A n th ra x /1 03 12001/hanSO.asp). G o to the F B I ’s press room (w w w .fbi.go v/pressrei/ pressrelOl.htm ) to dow nload “W ha t to do if you receive a suspicious letter or pack­ ag e” dated O cto b er 12, 2001 (http://w w w.flji.gov/pressrel/pressrel01/mail3. p d f ) . G o to F E M A ’s outline o f the E m e rg e n c y M a n a g e m e n t G u id e for B u sin ess and Industry (h ttp ://w w w .fem a .go v/lib rary/b iz.ind ex.sh tm ) o r review the lo ng er

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E m e r g e n c y P r e p a r e d n e s s W e b site (h tt p : / / n d m s . d h h s .g o v / i n d e x .h t m l ) a n d the F B I ’s T e r r o r is m p a g e ( w w w .f b i.g o v / t e r r o r i n f o / t e r r o r i s m .h t m ). A ls o r e v ie w the C D C ’s P u b lic

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p a g e (w w w .

bt.cdc.gov/), including the E m e rg e n c y R e sp o n se (w w w .b t.c d c .g o v /E m C o n ta c t/in d e x . a s p ) and P re p a r a tio n and P la n n i n g ( w w w . b t . c d c . g o v / E m C o n t a c t / i n d e x . a s p ) to see if an y lin k s th ere w o u ld be u se fu l. C h e c k o u t the N P P A ’s C ritical In c id e n t R e s p o n s e T e a m (w w w .n p p a . o r g / s e r v i c e s / c i r t / d e f a u l t . h t m ) p a g e fo r in f o rm a tio n on h o w to d e a l w ith tr a u m a t ic in c id e n ts on th e jo b . C o n d u c t a s e a r c h o f m a j o r e le c tro n ic d a ta b a s e s su c h as A B I In f o r m / P r o Q u e s t, L e x is - N e x i s A c a d e m i c U n iv e r s e , or E b s c o . S e a rc h the In te rn e t fo r e x a m p l e s o f s u c h p la n s d e v e l o p e d by m e d i a ou tlets.

A S S IG N M E N T D e v e lo p a terro rism r e s p o n s e pla n tha t in c lu d e s the m a j o r c o m p o n e n t s d e e m e d vital by the o n lin e so u r c e s n o te d e a rlie r as w ell as a n y o th e r s o u r c e s y o u find. W rite a plan th a t in c lu d e s , b u t is n o t lim ite d to, all o f the fo l lo w in g se ctio n s. B e s u re to in c lu d e im p o r t a n t g u id e l in e s or a d v ic e n ot listed next. 1. D e s c r i b e the n e w se c u rity p r o c e d u r e s to be i m p l e m e n t e d at the m e d i a o u t ­ le t’s p r i m a r y a n d s e c o n d a r y lo c a tio n s to help p r e v e n t te rro rist a tta c k s, d i s ­ a ste rs, o r e m e r g e n c ie s . E x p la in h o w se cu rity p r o c e d u r e s will be m o n i to r e d an d u p d a te d as n e e d e d . T h e s e in c lu d e , b u t are not lim ite d to, e n tr a n c e and a c c e s s to p ri m a ry an d s e c o n d a r y lo c a tio n s , e m p l o y e e id en tifica tio n , s e c u ­ rity in s id e the b u ild in g s , h o w to id e n tify s u s p ic io u s p e rs o n s , p ro c e d u r e s fo r p ro c e s s in g m a il an d p a c k a g e s , ra d io lo g i c a l c o n t a m in a t io n , c h e m i c a l or b io l o g ic a l c o n t a m in a t io n , b o m b th re ats o r d is c o v e r y o f a b o m b , a n d so on. 2. D e s c r i b e w h a t to in c lu d e in a tr a in in g p r o g r a m (e.g., e m e r g e n c y o r e v a c u a ­ tion drills, w h a t to d o if a b o m b is d e te c te d , etc.), w h o s h o u ld i m p le m e n t it, an d w h y . E x p la i n h o w o ften to c o n d u c t tr a in in g and w h y . D is c u s s w a y s to m a k e g u id e l in e s on r e s p o n d in g to c rise s e a sily av a ila b le to e m p l o y e e s at a m o m e n t ’s n otic e. 3. D e s ig n a t e a p r i m a r y and s e c o n d a r y e m p l o y e e (e.g., u se a specific j o b title listed on the o u t l e t ’s W e b site o r ty p ic a lly f o u n d in the ty pe o f m e d i a o u tle t y o u are u sin g ) fro m e a c h m a j o r d e p a r t m e n t (e.g., n e w s , sales, cir c u la tio n , p ro d u c t io n , etc.) w h o s h o u ld h a n d le r e s p o n s e s to th e attack in th at d e p a r t ­ m e n t an d e n s u r e e n o u g h first aid, fo o d , a n d w a te r p r o v i s io n s are on h an d . E s ta b lis h a c h a in o f c o m m a n d an d rules to fo llow in e a c h d e p a r t m e n t in the e v e n t th at the p r i m a r y an d s e c o n d a r y e m p l o y e e s are in c a p a c ita t e d or killed d u ri n g the attack.

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4. D e s c ri b e th e p r o c e d u r e s to fo llo w in th e e v e n t o f an a ttac k (e.g., e v a c u a ­ tio n, etc.), in c lu d in g the specific p ro c e d u r e s to fo llo w in th e c a se o f a n ti c ­ ip ated m a j o r ty p e s o f a tta c k s (e.g., b o m b i n g , a n th r a x , etc.). 5. D e s c ri b e the e s s e n tia l first aid, m e d i c a l, a n d c o u n s e l in g k n o w l e d g e n e e d e d to de al w ith in ju ry o r tr a u m a d u rin g or a fte r an atta ck. Id e n tify the k ind o f tr a in in g n e e d e d an d p r o v i d e re s o u rc e s an d in f o rm a t io n on the s u b je c ts for e m p l o y e e s to lo cate q u ic k l y d u ri n g an e m e r g e n c y o r attack. 6. E x p la i n the c o m m u n i c a t i o n s y s te m or p r o c e d u r e s to u se w ith in d e p a r t ­ m e n ts, b e tw e e n d e p a r t m e n t s , a n d b e tw e e n lo c a tio n s in the e v e n t o f an a t­ tack, b o th h ig h - an d lo w -t e c h , s h o u l d p o w e r be lost or e q u i p m e n t fail. 7. D e v e lo p a list o f lo cal an d n a ti o n a l c o n ta c ts fo r e a c h m a j o r ty p e o f t e r r o r ­ ism e m e r g e n c y s itu atio n and the o rd e r in w h ic h to c o n ta c t e a c h (e.g., call 9 1 l , call the F B I, etc.). 8. D e v e lo p a c o n ti n g e n c y plan for re lo c a tin g o p e ra t io n s , in c l u d in g b a c k u p p u b lis h in g , b r o a d c a s ti n g p la n s , an d so on. 9. D e v e lo p a pla n fo r d e a lin g w ith the p u b lic o r h o w to a d v is e the pu blic a b o u t p r o p e r w a y s to m a il o r c o n ta c t the m e d i a outlet. 10. D e v e lo p a c o m p a n y p o lic y r e g a r d in g e m p l o y e e s a fe ty an d d e c id e w h e re an d h o w to p u b li c iz e it. P r o v i d e e n o u g h d e tail an d e x a m p l e s to m a k e it ea sy f o r e m p l o y e e s to a p p ly in re al-life s itu a tio n s. F o r e x a m p l e , giv e e x ­ a m p l e s o f w h e n e m p l o y e e s s h o u ld c o n s i d e r th eir p e rs o n a l safe ty, w h e n th ey m ig h t feel u n c o m f o r ta b le c o v e r i n g a story o r d o in g th e ir jo b s , and the t y p e s o f b e st j u d g m e n t to e x e rc i s e to a v o id u n n e c e s s a r y risk o r d a n g e r w h ile p e r f o r m i n g j o b d utie s. 11. D e v e lo p a p lan o r p o lic ie s fo r th e o th e r m a j o r c o n s i d e r a t io n s y o u fo u n d in y o u r r e s e a rc h o n te r ro rism an d e m e r g e n c y p r e p a r e d n e s s .

Case 6.2 The Case of the Poorly P erform in g Salesperson

Ed M a r k h a m , the A f r i c a n - A m e r i c a n sales m a n a g e r at W C T V , w a s c o n s i d e r in g h o w to h a n d le a p ro b le m w ith o n e o f his s a l e s p e rs o n s , J a n e F o ls o m w h o w a s W h it e . E d w a s p r o m o t e d to sales m a n a g e r 3 m o n t h s a g o a fte r w o r k in g at W C T V fo r 2 y ears. H e e a rn e d his p ro m o ti o n by e x c e e d i n g sales g o a ls e v e ry m o n t h after his first on the j o b . H e d e v e lo p e d a re s e a rc h r e p o r t u sin g s e c o n d a r y d a ta like MR1 an d the L ife s ty le M a r k e t A n a ly s t to a n a ly z e the m a r k e t. H is f o r m e r b o ss p ra is e d the re p o rt, g a v e a c o p y to all s a l e s p e rs o n s , an d in c lu d e d a s u m m a r y o f it in the rate c ard . W h e n his f o r m e r b o ss left fo r a n e w j o b in a larg er m a r k e t, he r e c o m m e n d e d E d as his re p l a c e m e n t . Ja n e had b e e n a s a le s p e rs o n at W C T V fo r 2 years. F o r a lm o s t 2 y e a rs , sh e had e x c e e d e d sales q u o ta s a b o u t as m u c h as E d had. F o r the p a st 3 m o n t h s , she had

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not m et sales quotas. A fter his secon d m o nth as sales m an a g e r, Ed talked to Jan e a b o u t her p erfo rm an ce. She attributed her b elo w -a v e ra g e p e rf o rm a n c e to the closing o f a m a jo r advertiser, A n t h o n y ’s F ashions. T h is local clothing store closed b ec au se several m a jo r retailers, inclu din g J.C. P e n n e y s and D illards, had o p en ed at the local mall. E d listened to J a n e ’s e x plan a tio n and then su gg ested w ay s to obtain new clients. He asked Ja ne w h e th e r she had set person al sales goals, set up a p ro s p e c t file o f new and inactiv e advertisers as w ell as existing b u sin esses that w ere p o ­ tential clicnts, ca m e up w ith research and data on the m a rk e t to use in p re s en ta­ tions and reports to clients, c a m e up w ith new ideas or opp ortun ities to advertise for clients, o r asked her clients ab ou t their n eeds and go als (S h aver, 1995). Jane said no, she sim ply telep h o n ed or visited h er clients regularly to see if they w an ted to run ads. Ed also ask ed Jan e w hy several o f h er clients had not paid their bills. He e x ­ p lained that a salesperson m u s t check out a c lie n t’s ability to pay b efore running a schedule. Jane replied that she w as not aw are o f that fact and no one had e ver trained her to sell. She had sold time for a radio station before, but that w as all the training she had. E d ’s p re d e c e s so r had ju s t hired her and cut her loose. E d g av e Jane a m e m o after their first m e etin g a m on th ago ask in g her to focus on sales training for the n ext m onth. First, she should read S h a v e r ’s (1995) M a k ­ ing the Sa le! H o w to Sell M e d ia With M a r ketin g . H e gave h er a co py , told h er to read it, and asked h er to contact him if she had any q uestions. A fter read ing the bo ok , he told her that she should establish w ritten p erso nal sales goals, begin to d ev elo p a p rosp ect file (with tw o new and tw o inactive clients), and d evelo p three ideas for new adv ertising op po rtu nities for existing clients. In the m e m o , Ed told Jane that he w o u ld not hold h er to sales p e rf o rm a n c e standards th at m on th . He w an ted Jan e to focu s on do ing the b a ck g ro u n d w ork he assign ed to help her im p ro v e h er future sales p erfo rm a nce . A t the m eetin g a m o nth later, E d d isc ov ered Jan e had m ad e only a h alf­ hearted atte m p t at training. F o r e x a m p le , she had not d e v elo p e d a pro sp ec t file; she told him she had no idea how to do it. Ed ask ed h er w h y she had not c o n ­ tacted him to set up a m eetin g to discuss questio ns she had a b o u t the b o o k or c o m p letin g the ass ig n m en ts, as noted in his m e m o . She said she had forgotten. A sk ed specific q u estion s abo ut S h a v e r ’s (1995) sales bo ok , she w as u nab le to re­ sp o n d , su gg estin g she had not read it. Ed a sk ed Jane to read the b oo k again, and sch edu led a m eetin g with h er to discu ss the book. Ed instructed Jane to h ave a w ritten m e m o ready for the next m eetin g that identified the assistance o r training she n e ed ed to a c co m p lis h the tasks he had set for h er the prev io u s m o nth. “ Base y o u r need s a ss e ssm e n t m e m o on the S h a v e r bo ok and be prepa re d to discuss the b o o k fully,” he told her. Ed said he w o uld send her a m e m o abo ut their m eetin g , ou tlining w h at he had v e r­ bally asked her to do during the next m o nth as well as the co n se q u e n c e s o f not c o m p letin g these tasks. Ed told her, “Jane, if you d o n ’t start to m a k e a serious

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e ff o rt in p a rtic ip a tin g in y o u r tra in in g , an d u lt im a te l y i m p r o v i n g y o u r sales p e r ­ f o r m a n c e , y o u r j o b h e re c o u ld be in j e o p a r d y . ” E d ’s g u t fe elin g w a s th a t s o m e th i n g else w a s b o th e r in g Ja n e . H e w o n d e r e d w h y she h a d g o n e fr o m e x c e e d i n g sale s q u o ta s to b e l o w - a v e r a g e sa les p e r f o r ­ m a n c e . H e w a s s u r p ris e d an e m p l o y e e w o u ld r e s p o n d h a l f h e a rte d ly to a w ritte n n o tice o f u n s a tis f a c to r y j o b p e r f o r m a n c e . H e w o n d e r e d if th ere w a s a n o t h e r r e a ­ s o n s sh e w a s n o t r e s p o n d in g to his a tt e m p t s to h elp her. Ed w a n te d J a n e to s u c ­ c e e d b c c a u s c he t h o u g h t she w a s a g o o d sa le s p e rs o n d e s p ite h e r a p p a r e n t la ck o f f o r m a l tr a in in g an d r e c e n t p e r f o r m a n c e . H e w a n te d to giv e h e r a f a ir c h a n c e to im p r o v e , b u t k n e w he w o u ld h a v e to fire h e r if she d id n o t tak e h e r tr a in in g s e r i­ o u sly a n d im p r o v e h e r p e rf o r m a n c e . H e w o n d e r e d h o w to be fair to h e r w hile p ro te c tin g the statio n . H e h a d n e v e r f a c e d this k in d o f p r o b l e m b e fo re . W e l c o m e to m a n a g e m e n t , he told h im self.

A S S IG N M E N T R e v ie w the c h a p te r an d a n s w e r th e fo llo w in g q u e stio n s. 1. W e r e E d ’s a c tio n s in w o r k in g w ith Ja n e fair an d a p p ro p r ia te thu s far? W h y or w h y n o t? 2. A re there an y o th e r s te p s E d s h o u ld ta k e n ow in d e a li n g w ith J a n e and this situ a tio n ? If y es, e x p la in th e m in detail. 3. W h a t do you th in k m a y be the re ason fo r J a n e ’s su d d en p o o r p e rf o rm a n c e ? 4. H o w can E d d is c o v e r w h e t h e r th ere is a n o t h e r r e a s o n fo r J a n e ’s a p p a r e n t u n r e s p o n s iv e n e s s to his e ffo rts to h e lp h e r i m p ro v e h e r p e r f o r m a n c e w ith o u t in c u r rin g an y leg al liab ility ? S h o u ld he take steps to find o ut? W h y o r w h y n o t? 5. W h a t step s s h o u ld E d take to id e n tify the train in g J a n e m a y n e e d ? W hy? 6. H o w

can

E d d e te r m i n e

fairly w h e th e r J a n e

si m p l y

lac k s a d e q u a t e

sales tr a in in g w ith o u t o p e n in g his statio n to a w r o n g f u l te r m in a tio n or o t h e r la w s u it? E x p la in y o u r a n s w e r an d p r o v i d e e x a m p l e s o f w h a t Ed s h o u ld do. 7. H o w s h o u ld E d d o c u m e n t the step s he ta k e s to train or, if n e c e s s a ry , d i s ­ c ip lin e J a n e ? W h y ? 8. W ith w h a t o th e r re s o u r c e s o r p e rs o n s s h o u ld E d c o n s u l t r e g a r d in g J a n e ? W hy? 9. H o w s h o u ld he use th e se r e s o u rc e s ? W h a t s h o u ld h e d o ? W h y ? 10. H o w s h o u ld E d re s p o n d to t o d a y ’s m e e t in g w ith J a n e ? T o a n s w e r this q u e s tio n , w rite a s a m p le m e m o fro m E d to Ja n e a b o u t t o d a y ’s m e e tin g . 11. W ri te a s a m p le m e m o fo r E d a s s u m in g th at J a n e d o e s n o t r e s p o n d s a t is ­ fa cto rily to the m e e t in g s c h e d u l e d fo r 1 m o n t h fro m no w .

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12. W ri te a s a m p le m e m o fo r E d, a s s u m in g J a n e d o e s r e s p o n d satisfa c to rily to the m e e tin g 1 m o n t h fr o m now . 13. W h a t o th e r p re s e n t o r future step s o r a c tio n s d o yo u r e c o m m e n d to E d ? W hy?

Case 6.3 Privacy Analysis of a W e b Site Directed to Child ren (or Adults)

S e le c t a m e d i a o u tle t or a d v e r t i s e r ’s h o m e p a g e on the In te rn e t in t e n d e d fo r or targ e te d to ch ild re n . E x a m i n e the site fully. C a re fu l ly r e v ie w all p riv a c y s t a te ­ m e n ts , p o lic ie s , p ro c e d u r e s , o r d e s c r ip ti o n s in c l u d e d in the W e b site. (N o te . T h is c a se c o u ld be a d a p te d to a n a ly z e th e p ri v a c y o f W e b sites in ­ te n d e d fo r a du lts. F o r e x a m p l e , su b s titu te sites h a v in g a d v ic e r e g a r d in g ch ild ren d is c u s s e d later in this c a se w ith th o s e from the c h a p te r for a d u lts, s u c h as r e v i e w ­ ing the F T C ’s p ri v a c y in itia tiv es [w w w .f t c . g o v / p r i v a c y / i n d e x .h t m l J o n lin e in stea d o f its K id z P a g e . O th e r o n lin e r e s o u rc e s to use in s te a d o f the o n e s fo r ch ild re n n o ted la ter in c l u d e the D M A ’s e th ic a l g u id e l in e s fo r d ir e c t m a r k e te r s [www. t h e - d m a .o r g /li b r a r y / g u id e l in e s /] and in f o rm a t io n a b o u t p riv a c y is s u e s [w w w. th e - d m a .o r g /lib r a r y /p r iv a c y /in d e x .s h tm l] and g o v e r n m e n t affairs [w w w. the -d m a . o r g / g o v e r n m e n t/i n d e x .s h t m l ] . T h e

I A B ’s p riv a c y

link

[w w w .i a b .n e t / p r i v a c y /

ind ex .h tm l] also c o u ld be used fo r a dults. N A A ’s E le c tro n ic P u b lish in g link on its h o m e p ag e [w w w .n a a .o r g ] has inform atio n a b o u t online privacy for n e w s p a p e r W e b sites [e.g., see the article at w w w .n a a .o r g / a r t p a g e .c fm ?AID = 4 0 9 9 & S I D = 107].) C o n s i d e r h o w e f f e c tiv e the W e b s i te ’s p ri v a c y p o lic ie s are in p ro te c tin g th e p ri v a c y o f c h ild re n (or ad u lts). U se the fo l lo w in g in f o r m a t io n an d s o u r c e s to as s e s s p riv a c y e f f e c ti v e n e s s . D e lta an d M a t s u u r a ( 2 0 0 2 ) d e s c r ib e d p ro c e d u r e s to p ro te c t c h ild re n on the In tern et: (a) th o s e k n o w in g ly c o lle c tin g p e rs o n a l in f o rm a t io n o n lin e fro m c h ild re n y o u n g e r tha n 13 y e a rs o f ag e m u s t o b tain v erifia ble c o n s e n t fro m a c h i l d ’s p a r e n t o r g u a rd i a n b e fo r e c o lle c tin g the i n f o r ­ m a tio n ; an d (b) p ro v i d e p riv a c y p o lic ie s an d p ra c tic e s b e fo re c o ll e c ti n g i n f o r m a ­ tion id e n tif y in g the ty p e o f in f o rm a t io n to be c o lle c te d , d e s c r ib e h o w the in f o rm a tio n w ill be u se d , an d id en tify all third p a rtie s w h o will h a v e a c c e s s to the in f o rm a tio n . D e lta a n d M a t s u u r a ( 2 0 0 2 , A p p e n d ix 1— P e rs o n a l D a ta P riv a c y , pp. A p p . 1-1 to 1-2) p r o v i d e d g u id e l in e s fo r d e v e lo p i n g p e rs o n a l d a ta p riv a c y p o lic ie s for c h ild re n an d adults: 1. D e s c ri p tio n o f d a ta — T e ll in d i v id u a l s c le a rly a b o u t the ty p e o f p e rs o n a l d a ta to be c o lle c te d . 2. D e s c ri p tio n o f u s e s /u s e r s — Id e n tify th e in te n d e d u se s o f p e rs o n a l d a ta as w e ll as w h o w ill be u sin g th e data.

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3. S ecurity m e a s u re s— D escrib e and im p le m e n t the security m easu res to be used to p rotect personal data from u na uth orized uses o r access. 4. A c c u ra c y — D escrib e ho w individuals c an review th eir perso nal data, c h a l­ len ge it, or c orrect it. 5. Special m ea su res for safeg uard ing ch ild ren — D escribe and im p le m e n t sp e ­ cial p ro ced u re s to prev en t the m isuse o f personal data ab ou t or obtained from children. P ro vide d isclosures o f h ow and by w h o m such d ata will be used. P ro vid e a w ay fo r parental au tho rizatio n to be obtained and m onitored. 6. O v e rsig h t and aud it p ro c e d u r e s— D escribe and im p le m e n t m e th o d s to m o n ito r the effectiv en ess o f p riv acy m e as u re s and p ro ced ures. N eutral third parties sho uld c o n d u c t audits, and the results shou ld be m a d e avail­ able to the public on request. 7. C o ntra cts with data users— E n ter into co ntracts with oth er parties w h o will use the personal data you c ollect online. Include specific p rov ision s in the c o ntracts abo ut the ob lig atio ns o f the party using the data to p rotect it and limit its use. N o w review a d v ice and req u irem en ts for pro tectin g the privacy o f children online in cluding the F T C ’s K id z P riv acy p a g e (w w w .flc .g o v /b c p /c o n lin e / e d c a m s/k id zp riv a c y /in d e x .h tm l). (S ubstitute o th e r p riv acy links from the ch ap te r o r th ose you find re gard ing adults if you are rev iew in g a W e b site for perso ns age 18 o r older.) D o w n lo a d and review the in fo rm atio n on how to co m p ly with the C h il d r e n 's O n lin e Privacy P rotection A c t (w w w .ftc .g o v /b c p /c o n lin e /e d c a m s / kid zpriva cy /b iz.htm ). A lso review the C A R U ’s S elf-R eg u la to ry G uid elin es for C h il d r e n ’s A d v ertisin g onlin e (w w w . c a r u .o r g /c a r u s u b p g s /g u id e p g .a s p ) and S afe H a rb o r P rog ram ( w w w .c a ru .o r g /c a r u s u b p g s /h a r b o r p g .a s p ). T h en scroll c o m ­ pletely throu gh and read, but do not c o m p le te, the C h il d r e n ’s P riv acy Policy G e n e ra to r at the D M A ’s W e b site (h ttp ://w w w .th e -d m a .o rg /lib ra r y /p riv a c y / ch ild re n sp p g .sh tm l). T ry to find o the r sources regarding on lin e privacy and review them as well.

ASSIG NMENT A fter re v iew in g th ese sites and any o th er inform ation you find, review again the c o m m e rc ia l h o m e page for children (or adults) you selected. E v alu ate w h e th e r it follow s the online guid elin es for adv ertisin g to children (or the app ro priate gu idelin es for adults). You m ay c o m b in e the p rincip les noted in all o f the advisory or self-regulatory g uidelin es listed o r select one set o f adv isory or self-regulatory g uidelin es for y ou r analysis. Prepare a report that includes the follow ing.

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Questions to Answer if Evaluating a W e b Site for Children 1. D o es the c o m p a n y indicate the age g rou p to w hich the page is ta rgeted? If not, to w hich ag e gro up do es the h o m e p age seem to be ta rgeted? 2. Did the c o m p a n y o r m ark eters a p p e ar to take a d v an ta g e o f the typical tar­ geted c h il d ’s age, k n o w le d g e , so ph istication , and m aturity unfairly or u n ­ ethically w h en d ev elo p in g the W e b site? W h y o r w hy not? 3. Are the c o m p a n y ’s priv acy p olicies and practices n otices p ro m in en tly d isp layed and easy to find and read for the targeted ag e g rou p? 4. Are the c o m p a n y ’s privacy policies c o m p le te and ap p rop ria te? Prov ide details and exp lain w h y or w h y not. 5. Is it easy for the targeted age group to understand they arc being asked to disclose personal inform ation (if applicable)? H as an opt-out m ech a nism to avoid subm itting personal inform ation been provided? Is it easy for the tar­ get group to understand and use the opt-out m ech a n ism ? In y ou r opinion, is it pressure-free or are children e ncouraged too strongly or unethically to get a free gift or som eth in g else for pro viding personal inform ation? 6. Is there a clear, appropriate, and easy w ay for parental authorization to be

7.

8.

9.

10.

obtained and m onitored? Are parents notified independently and separately from the child? Does it ap pe ar easy for children to circum vent the system, pretend to be their parents, and authorize or provide consent them selves? Is there a m e c h a n ism , easily u n d erstoo d by the typical targeted child, for a v o iding future e-m ail m es sa g e s from the a d ve rtise r or c o m p a n y ? Did you receive any unsolicited e-m ail after surfing the site? W a s there a m e c h a n is m approp riate for the target g ro up in the un solicited e -m ail for refusing future e-m ails? W h e n e v e r pu rchase or personal inform ation is sought, is there a p ro m in ent m essage that is easily u nd erstood by the target group asking them to seek a parent or g u a rd ia n ’s perm ission before doing so? A lso is there a m e c h a ­ nism for canceling the purchase, after the fact, by the parent or guardian? W e re there any oth er g uid elin es o r practices th at the ad v e rtise r or m edia outlet violated or exec u ted w ell? W h a t w ere these gu idelin es or p ra c ­ tices? W h y did the c o m p a n y ex ec u te them well or v iolate th em ? O verall, do you think the adv ertise r or m e dia outlet c o m p lie d with the reg ulato ry and self-regulatory guid elin es regard in g onlin e privacy p ro te c ­ tion for ch ildren? W h y o r w hy not?

11. G en erally spe akin g, do you think the regu latory and self-regulatory g uid elin es are an effective w ay to p ro tect the p riv acy rights o f children surfing the W e b ? W h y or w h y not? Questions to Answer if Evaluating a W e b Site for Adults I. A re the c o m p a n y ’s privacy policies and practices p rom in ently display ed and easy to access, find, and read?

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2. A re th e c o m p a n y ’s p ri v a c y p o lic ie s c o m p l e t e and a p p r o p r ia t e ? P ro v i d e d etails and e x p la in w h y or w h y not. 3. Is it e a sy for a v is ito r to u n d e r s ta n d th e y are b e in g a s k e d to d is c lo s e p e r ­ s o n a l in f o r m a t io n (if a p p li c a b le ) ? Is an o p t- o u t m e c h a n i s m to a v o id s u b ­ m ittin g p e rs o n a l in f o r m a t io n p r o v i d e d ? 4. Is there a m e c h a n is m for a v o id i n g fu tu re e -m a il m e s s a g e s fro m th e a d v e r ­ tise r o r c o m p a n y ? D id yo u r e c e iv e an y u n so lic ite d e -m a il afte r surfing the site? Is th e re a m e c h a n i s m in the u n s o lic ite d e -m a il fo r re f u s in g fu tu re e -m a ils ? 5. Is there a n y in a p p r o p ria te , o ff e n s iv e , or o b je c t io n a b l e c o n te n t on the site? I f ye s, w h a t p o s s ib le leg al p ro b l e m s o r ra m ific a tio n s ex ist? 6. W e r e th ere a n y o t h e r g u id e l in e s o r p ra c tic e s th a t the a d v e r t is e r o r m e d i a o u tle t v io la te d o r e x e c u t e d w e ll? W h a t w e r e th ese g u id e l in e s o r p ra c t ic e s ? W h y d id the c o m p a n y e x e c u t e th e m w e ll o r v io la te th e m ? 7. O v e ra ll, do y o u th in k the a d v e r t is e r o r m e d i a o u tle t c o m p l i e d w ith th e a p ­ p ro p r ia te legal a d v ic e a n d / o r se lf-r e g u la to ry g u id e l in e s r e g a r d in g o n lin e p riv a c y p ro t e c ti o n ? W h y or w h y not? 8. G e n e ra ll y s p e a k i n g , d o y o u th in k se lf-r e g u la to ry g u id e l in e s are an e f f e c ­ tive w a y to p ro te c t the p riv a c y rig h ts o f a d u lts surfin g the W e b ? W h y or w h y n o t? P r o v i d e e x a m p l e s to e x p la in y o u r a n s w e r.

Case 6.4 Reviewing and Analyzing Freedom of In fo rm atio n Resources and Issues

S e le c t a state o f in te re st an d re v ie w o n lin e an d o t h e r a v a ila b le so u r c e s to d i s ­ c o v e r its in f o rm a t io n a c c e s s la w s if an y. C o n d u c t a d a ta b a s e s earch in A B I Inf o r m / P r o Q u c s t o r L c x is - N c x i s A c a d e m i c U n iv e rs e to find r e c e n t c a s e s o r issues r e g a r d in g a c c e s s to in f o rm a t io n in y o u r state o f in te re s t o r an y state o r n atio n a l fre e d o m o f in f o rm a t io n le g isla tio n , is su es, c a se s , o r d e b a te s. F o r e x a m p l e , sec if any a c c e s s is su es o r c a s e s in v o l v in g n a tio n a l se cu rity h a v e arisen . H a v e there b een a n y a b u s e s o f a c c e s s in the n a m e o f p ro t e c ti n g n atio n al se c u r ity ? H a v e any o th e r c a s e s in v o l v in g c e le b ritie s o r p u b lic fig ures like the D a le E a r n h a r d t ca se a ris e n ? Is th ere a n e w c a te g o ry o f ty p e o f a c c e s s issue th at h a s e m e r g e d re c e n tly ? V isit the n e a re s t law library to re v ie w c o p ie s o f the a c c e s s la w s in y o u r state o f interest. C o n ta c t the a p p ro p r ia t e g o v e r n m e n t a g e n c y or office for m o r e in f o r­ m a tio n a b o u t a c c e s s in y o u r area. (I f y o u r re s e a rc h into state a c c e s s to i n f o r m a ­ tio n b e c o m e s too d ifficult, re s e a rc h a c c e s s at th e fe d e ra l g o v e r n m e n t level. A c c e s s m o s t fe d e r a l a g e n c i e s at the F e d e ra l W e b N a v i g a t o r [law d b a se. law. v illa n o v a .e d u /fe d w e b /] an d e x a m i n e th e ir o n lin e p o s t in g s an d in s tru c tio n s r e ­ g a rd i n g a c c e s s and f r e e d o m o f in f o rm a t io n re q u e s ts.)

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T hen c o n d u c t an online review o f F O IA sites. C h e c k out the S P J ’s F O IA R e ­ source C e n te r (http ://w w w .s p j.o rg /fo ia .a sp ) and T h e Internet L aw Library (w w w .la w g u r u .c o m /ila w lih /). R ev iew o th er so urces that m ay h a v e articles and in fo rm a tion on access. F o r ex am p le, try searchin g the R ep orters C o m m itte e for F re ed o m o f the Press site (w w w .r c fp .o r g ) and its T a p p in g O fficials’ Secrets p ag e ( w w w .r e p o r te rs c o m m itte e .o rg /ta p p in g 2 0 0 1 /in d e x .c g i) fo r in fo rm atio n on yo ur state o f interest. E d ito r & P u b lish e r (w w w .e d ito r a n d p u b lis h e r .c o m ), the N A A ’s W e b site ( w w w .n a a .o r g ), and the R T N D A ’s (w w w .r t n d a .o r g ) F re e d o m o f In fo r­ m atio n link with inform ation on acc ess (w w w .rtn d a .o rg /fo i/a tp .s h tm l) arc g oo d sites to explore. A lso try C o rnell U n iv e rs ity ’s L eg al In fo rm atio n Institute (w w w .la w .c o r n e ll.e d u ), A J o u r n a lis t’s G u id e to the Internet (rep o r ter.u m d .ed u /), including the R ec o rd s and F O IA link (r e p o rte r .u m d .e d u /re c o rd s.h tm ), and any oth er F O IA reso urces o r links you find.

ASSIG NMENT D ev elo p a report, in c lud ing b u t not lim ited to the follow in g qu estio ns, w h ich co uld be u sed by reporters or oth ers as a g uid e to u n d ers tan d in g the F O IA , the m ajor issues su rrou nd ing it, and fo r requesting g o v e rn m e n t d o cum en ts. 1. W h a t law s, if any, are applicable in the state you selected? 2. W h a t are the m ajo r c o n te m p o ra r y issues reg ardin g a ccess to g o v e rn m e n t inform ation in yo ur state and nationally? Identify and d escribe each type o f issue, both national and state, and p ro v id e a d escription and e x a m p le o f each. 3. W h a t are the g eneral tech niq ue s fo r ob tainin g d o c u m e n ts from the a p p ro ­ priate state g o v e rn m e n t o r federal entities? 4. W h a t are c o m m o n p ro b lem s or pitfalls to av oid w h en attem p ting to gain a ccess to g o v e rn m e n t d o cu m e n ts? 5. W h y m ay erosion o f access to g o v e rn m e n t in form a tion o c c u r in the future? W h a t can m ed ia outlets o r org an izatio n s do to p reserve and p ro tcct acccss to in fo rm a tion ? 6. W h a t oth er im p o rtan t in fo rm a tion or ad vice did you find in y o u r resea rch ? Identify and ex plain each facto r here.

C H A P T E R

7 P

l a n n in g

A n y m a n a g e r w h o w a n ts to m a k e e f f e c tiv e d e c is io n s m u s t b e c e rta in th o s e d e c i ­ sio n s are c lo s e ly a lig n e d w ith the c u rr e n t b u s i n e s s o p p o rt u n it ie s , u n iq u e r e ­ so u r c e s , an d stre n g th s o f the m e d i a c o m p a n y . P la n n in g is d o n e in c y c le s with ca re fu l tim in g a n d r e s o u rc e allo c a tio n p a rt o f the p ro c e s s . M e d i a c o m p a n i e s c o n ­ ti n u e to w rite an d follo w m is s io n p la n s , b u t the tim e fr a m e s fo r re v ie w h a v e bee n a d ju s te d b e c a u s e o f rapid te c h n o l o g ic a l c h a n g e s , r e c e n t e c o n o m i c d o w n tu r n s , as w ell as the e v e n ts o f S e p t e m b e r 11, 2 0 0 1 . F o r e x a m p l e , o n e larg e m e d i a c o m p a n y c h a n g e d fro m re v i e w i n g b u d g e ts on a 3- to 5 - y e a r c y c le to a t w ic e - a n n u a l r e v i e w , a ll o w i n g m u c h c lo s e r m o n i to r in g o f c o n s u m e r and a d v e rtis in g flu ctu atio ns. O th e r m a n a g e r s re p o r t that, a lt h o u g h m i s ­ sion s ta te m e n ts w e re fo r m e rl y p o s te d e v e r y w h e r e to s ig n a l th e ir c o n n e c t io n to b u s in e s s d e c is io n s , n ow th ere is less d is c u s s io n an d m o r e d e b a te a b o u t a c tio n s tha n th ey h a v e h eard in 20 y ears . “ T h in g s h a v e b e e n c h a n g in g so fa st, th a t w e all re c o g n i z e w e are in a d y n a m i c tim e fo r o u r b u s in e s s , and th e r e are c h a n g e a g e n ts e v e r y w h e r e , ” say s o n e m a n a g e r. A lth o u g h tim e fr a m e s an d r e s p o n s e rates m ay h a v e a c c e le ra te d , the p r o c e s s o f p la n n i n g r e m a in s stable.

STEPS IN P L A N N IN G T h e p la n n in g p ro c e s s fo r m e d i a c o m p a n i e s is p r a g m a ti c an d g e n e ra l ly tak es th ree fo rm s: (a) s trateg ic , (b) in te r m e d ia t e , and (c) s h o r t-r u n p la n n in g . S tra teg ic p la n n i n g in v o l v e s a llo c a tin g re s o u r c e s to a c h ie v e the f i r m ’s lo n g - te rm go als. T h e s e p lan s ca n c o v e r 1 to 10 y e a rs , b u t arc u s u a lly d e v e lo p e d fo r a 3- to 5 - y c a r p e rio d . T h e y r e p r e s e n t the w a y s a c o m p a n y e x p e c t s to c a rr y o u t its m issio n . I n t e rm e d ia te p la n s g e n e ra l ly c o v e r 6 m o n t h s to 2 y e a rs a n d p ro v id e r e i n f o r c e ­ m e n t o r c o rr e c tio n data fo r lo n g - te rm g oals. B c c a u s c o f c u rr e n t e c o n o m i c u n c e r ­ ta inties, m a n y m e d i a c o m p a n i e s find it c h a ll e n g in g to re m a in p ro a c tiv e ra th e r th an re a c tiv e to m a r k e t flu ctu atio n s a ffe ctin g c u s t o m e r s a n d p r o d u c t d e m a n d s . S u c c e s s fu l c o m p a n i e s a d ju s t n im b ly to e n v ir o n m e n t a l c h a n g e s , a v o id i n g d is tr a c ­ tio ns from th eir s tra teg ic p la n n i n g g o a ls d u e to te m p o r a r y fluctu atio ns. 159

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CHAP T E R 7

Short-run Plans

Intermediate Plans

Strategic Plan

YEAR FIG. 7.1.

1

2

3

4

5

Relationship among strategic, intermediate, and short-run planning.

vShort-run p la n n i n g in v o lv e s a few w e e k s up to a year. T h is ty p e o f plan a ll o ­ c a te s r e s o u rc e s on a d a y - t o - d a y o r m o n t h - t o - m o n t h basis. F ig u re 7 . 1 s h o w s h ow the th ree p la n s fit to g e th e r. T h e stra te g ic p lan fulfills the fi r m ’s m is s io n a n d o v e r ­ all g e n e ra l g o als . T h e in t e rm e d ia t e pla n in v o l v e s the g e n e ra l w a y in w h ic h the strateg ic p la n is p u r s u e d , and th e sh o rt-ru n plan is h o w th e stra teg ic plan w o rk s on a d a y - t o - d a y basis. C o m m o n Characteristics of Planning All th ree ty p e s o f p la n n i n g ha v e c o m m o n a li ti e s , a lt h o u g h the tim e p e rio d , r e ­ sp o n s ib le pa rtie s, a n d a c tu a l ste p s vary . M e d i a c o m p a n i e s h a v e g e n e r a l o r g a n i z a ­ tio n al g o a ls or fairly a b s t ra c t s t a te m e n ts o f w h a t th ey h o p e to a c h ie v e w ith in g iv e n a re a s o f p e r f o r m a n c e . T h e s e g o a ls are d e ri v e d fro m the m e d i a f i r m 's m i s ­ sion sta te m e n t, w h ic h reflects its b u s i n e s s d o m a i n an d m a y in c lu d e s t a te m e n ts a b o u t its ro le o u ts id e its p r i m a r y b u s i n e s s m a r k e ts . T h e m is s io n s t a te m e n ts fo r p u b lic m e d i a c o m p a n i e s arc w ritte n fo r leg al and b u s in e s s clarity . M o s t m a n a g e r s c o u ld n o t recite th e m w o r d fo r w o rd , b u t do ha v e a p ra g m a ti c u n d e r s ta n d in g o f h o w the s ta te m e n ts g u id e d e c is io n m a k i n g a n d r e s o u rc e a llo c a tio n s. O n e vice p re s id e n t fo r c ir c u la tio n say s his m c d i u m - s iz c u rban n e w s p a p e r in the s o u t h e a s t lo o k s at p la n n i n g on a rolling , 5 - y e a r c y c le th at p ro v i d e s a “ fu n d a m e n ta l ro a d m a p w ith o u t a lot o f e x p lic it detail. B u t it is a road m a p w h e r e all the d e p a r t m e n t s g e t to g e t h e r a n d c o m e to c o n s e n s u s so th a t w e ’re m o v i n g in a g e n e ra l d i r e c ti o n ” (p e r s o n a l c o m m u n i c a t i o n , A p ril 19, 2 0 02 ). If m a n a g e r s w e re a sk e d w h a t their n e w s p a p e r ’s m is s io n is fo r th e n ex t 5 yea rs , th e re w o u ld b e a v ariety o f a n s w e r s , b u t e v e r y o n e w o u ld a c k n o w l e d g e they are fo c u s e d on in crea sin g rea d e rsh ip . “ A n d th a t ’s b een a c h a n g e in the i n d u s ­ try o v e r the last c o u p le o f years. I m e a n , it u sed to be g r o w in g c irc u la tio n , g r o w ­ ing p e n e tr a ti o n — b u t o v e r th e last c o u p le o r three y e a rs it h as rea lly tr a n sitio n e d to r e a d e r s h ip , w h ic h is a really m o r e a c c u ra te reflec tio n o f o u r m e a s u r e m e n t in th e m a r k e t p l a c e ” (p e r s o n a l c o m m u n i c a t i o n , A p ril 19, 2 0 0 2 ).

PL A N N I NG

1 61

H is n e w s p a p e r ’s m issio n also focu ses on content, and all m an a g e ria l plans e m p h a s iz e the im po rta nce of the pro d u ct for the c o m m u n ity . It is a public service-based vision that translates into a m o re ta rgeted effort at specific zoning o f new s content. He sees both the readersh ip and co n ten t goals as parallel p la n ­ ning priorities, ad d in g that, “if you do a g o o d jo b with the co nten t, the readership will g r o w ” (personal c o m m u n ic a tio n , April 19, 2002).

Planning Tools T o assess p ro gress, an o rga niz atio n m ust have specific operation al definitions for m e a s u rem en t. F or e x am p le, the go al o f in creasing v iew ership a m o n g lo ng -term residents o f the c o m m u n ity could be op era tio n a lized as in creasing ratings by tw o points during the next 6 m o n th s a m o n g a u d ien c e m e m b e rs w h o h av e lived in the area o f d o m in a n t influence (A D I) for m o re than 10 years. T h e op eratio nal d e ­ finition m u s t specify in m easu rab le term s the g ro up to be affected (people w h o have lived in the A D I o r m a rk e t area for m ore th an 10 y ears), a tim e perio d d u r­ ing w h ich the ch a n g c is cx p c ctcd (n ext 6 m on ths), and a m ea s u rab le level o f p e r ­ fo rm a n c e that is bein g so u g h t (two ratings points). P lanning w ith ou t w ell-defined go als is like attending a potluck din ner w h ere the diner m ay enjoy the m eal, but by chancc rather than culinary design. Every plan involves preparation. T h e b etter the preparation is, the greater the c han ces o f reaching the goals. Preparation is simply the collection o f inform ation about the goals and possible alternatives for achiev ing them . The goals that fit the mission and can be o perationally achieved are the ones follow ed by the organization. All p lan n in g includes p ro ced u re s for carry ing out the plan. T h e p ro ced u res outline m e c h a n is m s for analysis, in form atio n collection, and m o nito ring that as­ sist in d ev e lo p in g and e x e cu tin g plans. O f course k n o w in g w hat tools are a v a il­ able fo r p la nn ing is not the sam e as k n o w in g how to apply those tools. A pp lication is p erfected through ex pe rien ce, practice, and reflection. Finally, all planning involves assessm ent to provide tangible evidence o f the process. T he steps for achie ving goals and the time frame and resources necessary for carrying out the plan are identified. Results are c om pared against goals for as­ sessment purposes. N ow the three m ajor planning d o cum ents are covered in detail.

STRATEGIC PLANNING Strategic plan n in g is the long-term process by w h ich an org anization pursu es its m ission and tries to rea ch its goals. If an organ ization participates in tw o or m ore o f the three traditional m edia markets— inform ation, advertising, and intellectual— the strategic plan m u st explicitly ad dress these m ark ets and explain the re la tio n ­ ship a m o n g them . A TV station can n o t m a k e p lans for the ad vertisin g m ark et w itho ut inclu din g the inform ation m a rk et w here view ers are attracted.

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CHAP T E R 7

FIG. 7.2.

Steps in strategic planning.

A n e w s p a p e r c a n n o t plan for the in f o rm a t io n m a r k e t w ith o u t e x a m i n in g the role it p lay s in the in te lle c tu a l m a rk e t. S m i th et al. ( 1 9 8 5 ) u se d the term s t r a te g i c m a n a g e m e n t in lieu o f s tr a te g ic p l a n n i n g b e c a u s e the tra d itio n a l c o n c e p t o f s trateg ic p la n n i n g did n o t in c lu d e c o n tr o l o f the plan as it w a s im p le m e n te d . T h e y said stra te g ic m a n a g e m e n t

PLANNING

163

in c lu d e s: (a) a n a ly z in g the e n v i r o n m e n t , (b) d e te r m i n in g o b je c tiv e s , (c) a n a l y z ­ ing strateg ic a lte rn a tiv e s, (d) s e le c tin g s tra te g y a lte rn a tiv e s, (e) im p le m e n ti n g the s tra te g ie s, an d ( 0 e v a lu a tin g an d c o n tr o llin g p e r f o r m a n c e . C o m b i n i n g these a p p r o a c h e s p lu s a d d in g c o n tr o l to p la n n in g res u lts in a m o r e refined a p p r o a c h to strateg ic th in k in g , w h ic h in c lu d e s th e fo l lo w in g step s (see Fig. 7.2): 1. E x a m i n e the b u s in e s s e n v i r o n m e n t a n d p a st p e r f o r m a n c e . 2. E v a lu a t e a v a ila b le r e s o u rc e s. 3. Id e n tify , s elect, p rio ritize, and o p e r a t io n a l iz e p la n n i n g go als. 4. Id e n tify a lte rn a tiv e a p p r o a c h e s f o r o b ta in in g g oals. 5. S e le c t fr o m a m o n g the a lte rn a tiv e a p p ro a c h e s . 6. I m p l e m e n t the plan. 7. M o n i t o r im p le m e n ta t io n . 8. E v a lu a t e the p l a n ’s p r o g r e s s an d a d ju s t th e p lan. C o lle c tio n an d a n a ly s is o f in f o rm a t io n are part o f th es e e ig h t ste p s in stra tegic p la n n in g . P la n s f o r the fu tu re m u s t b e g ro u n d e d in e x p e r i e n c e an d an u n d e r ­ s ta n d in g o f c u rr e n t m a r k e t c o n d itio n s . E n v i r o n m e n t a l fa c to rs a ffe ct h o w m e d i a c o m p a n i e s a p p r o a c h th e ir p la n n in g . E c o n o m i c d o w n t u r n s h a v e fo r c e d c o m p a ­ n ies to a d ju s t the tim e f r a m e fo r strateg ic p la n n in g . T h e m a r k e t a n a ly s is is the p r i m a r y m e t h o d o f e v a lu a tin g the b u s i n e s s e n v i ­ r o n m e n t. T h e in te rn al e x a m i n a ti o n in v o lv e s h o w w ell th e firm a c c o m p lis h e d its g o a ls in the p a st an d w h y . F a ilu re to rea ch g o a ls co u ld h a v e res u lte d from any n u m b e r o f p r o b l e m s in s id e the firm, in c l u d in g in a p p r o p ria te g o als , g o a ls set too h ig h , p o o r a n a ly s is o f d ata, i n a d e q u a te r e s o u rc e s , o r p o o r p e r f o r m a n c e .

Technology Resources T e c h n o l o g y in the last 5 y e a rs p ro v i d e d a d y n a m i c w a y fo r m a n a g e r s to be c lo s e r to c u s t o m e r s ( w h e th e r th ey are a d v e rtis e rs o r su b s c rib e r s ). F o r e x a m p l e , tu r n ­ a r o u n d tim e has b e e n g re a tly r e d u c e d fo r s o lv in g an d r e s p o n d in g to p ro b l e m s . B u il d in g te c h n o l o g y o p tio n s into th e p la n n i n g p r o c e s s is ess e n tia l f o r m e d i a c o m p a n i e s . O n e v ice p r e s id e n t o f c ir c u la tio n fo r a n e w s p a p e r say s, “ T e c h n o l o g y h a s a ll o w e d us to p u t out a b e tt e r p r o d u c t b e c a u s e w e h a v e im p r o v e d d e a d li n e s fo r later n e w s , h a v e b e tt e r d is trib u tio n n e tw o r k s , an d h a v e g r e a t e r ab ility to z o n e ” (p e r so n a l c o m m u n i c a t i o n , A p ril 19, 2 0 0 2 ). M a n y tr a d itio n a l m e d i a c o m p a n i e s c o n s i d e r the In te rn e t a n d o n lin e se rv ic e s as c o m p l e m e n t a r y p r o d u c t s an d p lan a c c o rd in g ly . T h e y c ro s s-se ll a d v e rtis in g , re a d e rs, v ie w e rs , a n d listene rs. T h e y sort r e g u l a r s u b s c rib e r s so th a t sp o rts e n t h u ­ siasts r e c e i v e e -m a il alerts a b o u t sp e c ia l sales on sp o rts e q u i p m e n t o r o ff e r a d d i ­ tio n a l d is c o u n ts to c u s t o m e r s w h o re s p o n d to c r o s s - p r o m o ti o n s on th e W e b . “ W e see the In te rn e t as a w a y to g ro w o u r c u s t o m e r b a se as w ell as m a i n ta i n and

164

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retain w h a t w e h a v e . It h as im p r o v e d o u r c u s t o m e r re la tio n s h ip m a n a g e m e n t , ” s a y s a m e d ia m a n a g e r (p e r s o n a l c o m m u n i c a t i o n , A p ril 19, 2 0 02 ). T h e Internet p ro v id ed m e d ia c o m p a n i e s w ith tools to build and retain c u s to m e r re latio n sh ips that are d y n a m ic and not d e p e n d e n t on su b s crib ers repo rtin g p r o b ­ le m s to service d e p a rtm e n ts. F o r e x a m p le , su b s crib ers can be sorted into regu larly c o n ta c te d gro u p s. W ith in 2 w e e k s o f sub scrib in g , a new c u s t o m e r m ig h t receiv e an electron ic w e lc o m e p ac k e t w ith c o u p o n s , special offers, an d n otices o f presale s at the retailers they identified as favorite s. T h e n ex t e -m a il c o n ta c t m ig h t th a n k the c u s t o m e r fo r b ein g loyal an d invite c o m m e n ts on the q uality o f service. T h e third c o n ta c t m i g h t a n n o u n c e a sp ecial p a y m e n t o ptio n for q uality c u sto m e rs . L a te r on in the relation ship , the s u b s c rib e r m ig h t be identified as a p referred c u s t o m e r w h o has w o n tw o free tickets to a c o n c e rt the m e d ia c o m p a n y is sp on so rin g . S u c h tim e d , c o n s is te n t, and p la n n e d targ e tin g is a ttractiv e , a ll o w i n g c u s ­ t o m e rs to be so rted an d c o n ta c ts a d ju s te d a c c o r d i n g to d e m o g r a p h i c s , lifesty le v ariab les , g e o g r a p h y , o r c u s t o m e r lo n g e v ity . A d v e rti s e rs are e asily b u ilt into the p lan. T h e m e d i a c o m p a n y thu s facilitates d y n a m i c an d m u l t i d im e n s io n a l re l a ­ t io n s h ip s a m o n g the m e d i u m , su b s c rib e r s , an d a d v e rtise rs.

Evaluate Available Resources A m a n a g e r m u s t e v a lu a te a t- h a n d r e s o u rc e s to e n s u r e th a t g o a ls can be m et. Ath a n d r e s o u rc e s in c lu d e th e c o m p a n y ’s n a m e an d r e p u ta tio n , p e rs o n n e l, p la n t and e q u ip m e n t, an d finan ces. A t- h a n d m e a n s the r e s o u rc e s are h e ld c u rr e n tly b y the firm or can be e asily b o r r o w e d . T h u s , financial re s o u r c e s a ls o in c lu d e an o r g a n i ­ z a t i o n ’s credit. E v a lu a t in g a v a ila b le r e s o u rc e s is im p o rt a n t b e c a u s e r e s o u rc e s d e te r m i n e w h e t h e r g o a ls can be a c h ie v e d . A lth o u g h re s o u r c e s can b e c h a n g e d fro m o n e fo rm to a n o th e r , the p r o c e s s d o e s n o t a lw a y s o c c u r as q u ic k l y as m a n a g e m e n t w o u ld like. If a larg e m e t ro p o l it a n T V station n e e d s an e x p e r i e n c e d a w a r d w in n in g a n c h o r, it w ill ta k e tim e to r e c r u it suc h an an c h o r. T h e u n c e rt a in t y o f tim e n e c e s s ita te s g o o d r e s o u r c e p la n n i n g b ased o n a c c u ra t e e v a lu a tio n o f w h ic h a n c h o rs are g o o d p ro s p e c ts. A s the stra te g ic p la n d e v e lo p s , e v a lu a tio n r e v e a ls w h e t h e r the re s o u rc e s n e e d e d to a c h ie v e the p l a n ’s g o a ls are c u rr e n tly a v a ila b le in the fo rm n e c e ss a ry . W h e n the o rg a n i z a ti o n lack s the r e s o u rc e s in the a p p ro p r ia t e fo r m n e e d e d b y the p lan , the p la n m u s t in c lu d e w a y s to a c q u ir e n ew o r c o n v e r t c u rr e n t re s o u rc e s . If the n e e d e d r e s o u rc e s are n o t an d c a n n o t be m a d e av a ila b le , the g o a ls a ss o c ia te d w ith th o se r e s o u rc e s s h o u l d be re c o n s id e r e d or a b a n d o n e d .

Setting Goals N o g u id e l in e s ex is t for the n u m b e r o f g o a ls a firm n e e d s to ide n tify o r select. H o w e v e r , all o f the sele c te d g o a ls s h o u ld be o b ta i n a b le and c o n s i s te n t w ith the

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f i r m ’s g e n e r a l g o a ls an d m issio n . E a c h go al re q u ire s r e s o u rc e s th a t a re re la tiv ely fixed. T h e m o r e g o a ls a firm p u rs u e s , the m o r e c o m p e t it io n th e r e is in s id e the o r ­ g a n iz a tio n fo r re s o u rc e s . F o r e x a m p l e , a s m a ll O h io n e w s p a p e r g ro u p m i g h t s e ­ lect th e fo llo w in g goals: 1. A d d d aily n e w s p a p e r s until the g ro u p h a s p a p e rs in m a r k e ts th at m a k e up 2 0 % o f the c ir c u la tio n in O h io ( i n fo rm a ti o n m a r k e t goal). 2. In c r e a s e by 3% the p e n e tr a ti o n o f e x is tin g m a r k e ts ( i n fo rm a ti o n m a r k e t goal). 3. In c r e a s e by 2 % r e v e n u e fro m n a tio n a l a d v e rtis in g (a d v e r tis in g m a r k e t goal). 4. In c r e a s e by 5% the c o l u m n in c h e s o f d is p la y a d v e rtis in g th a t ru n in the p a p e rs (a d v e r tis in g m a r k e t goal). 5. In c r e a s e by 10% the c o lu m n in c h e s an d p e r c e n t a g e o f the n e w s h o le d e ­ v o te d to le tters to the e d ito r an d g u e s t c o l u m n s (in te lle c tu a l m a r k e t goal). T h e g o a ls listed fo r the in f o rm a tio n an d a d v e rtis in g m a r k e ts c o n c e i v a b ly c o u ld c o m p e t e f o r re s o u rc e s . T h e a c q u is itio n o f n e w s p a p e r s c o sts m o n e y , as will e fforts to in c r e a s e p e n e tr a tio n . T h e p e n e tr a ti o n g oal in v o lv e s a d d itio n a l s p e n d in g for the c ir c u la tio n an d n e w s d e p a r t m e n t s , as w e ll as to p r o m o t e the c h a n g e s from the in c r e a se d sp e n d in g . A ll five g o a ls w o u ld c o n s u m e re s o u r c e s an d initially c o m p e t e . H o w e v e r , as the p lan g o e s into e ffe ct, a c h ie v in g s o m e g o a ls g e n e ra t e s r e v e n u e , w h ic h can th en be a p p lie d to m e e tin g o th e r go als. T i m i n g is im p o r t a n t to c o n s i d e r b e c a u s e not all g o a ls h a v e to be r e a c h e d at the s a m e tim e. S o m e are se t fo r the s e c o n d or third y e a r o f the p la n , an d s o m e are m a d e c o n ti n g e n t on re a c h in g o thers.

Alternative Approaches A lm o s t all lo n g -term g o als are re a c h e d w ith m o r e than o ne a p p r o a c h and o ften r e ­ q uire m u ltip le a p p ro a c h e s . F o r e x a m p l e , a ra d io station th at w a n ts to in crease its share o f liste ners can alte r its m u s ic fo r m a t a nd p ro m o te itself in a n u m b e r o f w ay s. T h e aim is to s elec t the m o s t e fficient and e ffectiv e w a y s to reach o r su rp ass the goals. T h e ability to select the b e st a p p ro a c h d e p e n d s on h o w e x h a u s tiv e the a n aly s is p r o c e d u r e is. O fte n m a n a g e m e n t settles for a less than o p tim a l plan to a c h ie v e a goal b e c a u s e all ideas w e re n o t id entified in the d e c is io n - m a k in g stage. B r a in s to r m in g is a c o m m o n l y u sed t e c h n i q u e fo r g e n e ra t in g id eas. It a p p lie s tw o b asic p rin c ip le s o f c r e a tiv e th in k in g : A p o s itiv e attitu d e is e s ta b lis h e d , w h ic h m e a n s c ritic ism is w ith h e l d until a fte r id eas are d e v e lo p e d , an d u n u su a l i d e a s are e n c o u r a g e d e v e n if th ey s e e m im p ra c t ic a l (W h i ti n g , 1995). A s s e s s in g a lte rn a tiv e s in c lu d e s e li m i n a ti n g im p ra c t ic a l o r i m p r o b a b l e on es. I m p ro b a b il it y an d im p ra c tic a lity are b ase d on any n u m b e r o f c h a ra c te ris tic s , i n ­ c lu d in g a p p r o a c h e s w ith h ig h risk, h ig h e n v i r o n m e n t a l u n c e rta in ty , and h ig h r e ­ s o u r c e n e e d s. T h e list o f a p p r o a c h e s is th e n p a re d to a m a n a g e a b l e n u m b e r o f

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three to six good alternatives for ach ievin g the goals. C o m p a riso n o f alternative plans can be as fo rm al o r inform al as m a n a g e m e n t likes. F rom these c o m p a r ­ isons, efficiency and effectiv en ess are dete rm in ed. E fficiency is m e a s u re d by the a m o u n t o f reso urces nee ded to reach a goal, and the m o st efficient ap p ro ac h is the one th at ach ieves the goal w ith the sm allest e x pe nd itu re o f resources. E ffe c ­ tiv eness is the p robability that the ap p ro a c h e s ach ieve the go als o f the plan.

INTERMEDIATE PLANNING In term e diate p lan n in g requires a m arketin g plan, a financial plan, and a h u m a n reso urces plan. T h e three m ust be co o rd in ated with each other as well as with the overall strategic plan.

Marketing Plan A m ark etin g plan deals with the m arketing mix, w hich inclu des pro du ct, place, price, and p ro m o tio n (the fou r Ps). T h e m ark etin g m ix is a pplicable to the in fo r­ mation, adv ertisin g, and intellectual m arkets. A lth o u g h they arc interrelated, each should hav e a m arketin g plan o f its ow n . T he pro d u ct is sim p ly w h a t is sold or g iven to a c o n s u m e r in c x c h a n g c for tim e or m o ney . In the in fo rm ation and in­ tellectual m ark e ts, the pro d u ct is info rm ation and ideas. In the adv ertisin g m a r ­ ket, it is the potential attention o f c o n s u m e rs to advertising in form ation. The value o f the adv ertising e x po sure d e p e n d s on the n u m b e r o f view ers, readers, or listeners as well as the types o f peo ple p a y in g the attention. In m o s t o rgan izatio n s, the p ro d u c t decision is b ased on the location o f old er pro d u cts in their life cycle. B uzzell and C o o k (19 69 ) discussed five stages o f a p r o d u c t’s life cycle: 1. Infancy is w h en a pro d u ct enters the m arket. S ales are low. 2. G ro w th o ccurs w h en the p ro d u c t m atu res as to w h o m and w h ere it will sell. Sales g row rapid ly if th e p ro d u c t finds its niche in the m arketplace. 3. A p p ro ach in g maturity is w h en the established p ro du ct begins to battle c o m ­ petitors o ver m ark et share. Sales continue to g ro w , but at a slo w er rate. 4. M atu rity occu rs w h en a p ro d u ct finds its p lace in its cate gory. C om petition co ntinu es and sales grow m u ch m o re slow ly than earlier stages. 5. D cclinc is the final stag e w h en c o n s u m e rs lose interest in the p ro d u ct and sales begin to dcclinc. W ith m o st m edia products, p lace is an im p o rtan t co nsid eratio n. N e w s c o m ­ m od ities such as n e w sp a p e rs and n e w sca sts are aim ed at specific g e og rap hic areas. T h e con tent reflects this aim . A s o c ie ty ’s size, g e o g ra p h y , social aspects, cultural ch aracteristic, and political nature affect the places for w h ich new s

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p ro d u c ts are d e sig n e d . P lace is also related to price in the U n ite d S tates. S o m e parts o f the c o u n tr y h av e h ig h e r an d lo w e r sta n d a rd s o f living than others. T h e s a m e b o o k w o u ld face a lo w e r d e m a n d d u e to p ric e in o n e r e g io n th an in an oth er. P la c e also affec ts th e p ro c e s s an d c o st o f d is trib u tin g the m e d i a p ro d u c t. T h e c o st o f d e liv e rin g a n e w s p a p e r in c r e a s e s as o n e m o v e s a w a y fro m the p ro d u c t io n site. T h e c o s t o f d is trib u tin g a b r o a d c a s t T V p r o g r a m is b a sic a lly th e s a m e w ithin the s i g n a l ’s ran g e. If the station w a n ts to d is trib u te th e p ro g r a m e ls e w h e r e , s a t e l­ lite tr a n s m i s s i o n w o u ld in c re a se costs. P rice affects d e m a n d and d e te r m in e s h ow m u c h rev en u e the firm takes in. P ri c ­ ing is a difficult p ro c e s s b e c a u s e the j o i n t n atu re o f m o s t m e d ia c o m m o d it ie s c r e ­ ates e x tr e m e u ncertainty. M a n a g e r s are afraid to o v e rp rice in o n e type o f m a rk e t b e c a u se it re d u c e s d e m a n d in another. In crea sin g a m a g a z i n e ’s su bscrip tion price m ig h t re d u c e circulation, w h ic h cou ld affect the price c h a rg e d to advertisers. T h e tr a d itio n a l w a y to p ric e e x is tin g p r o d u c t s is to lo o k at in flation, e x a m i n e c o m p e t i t o r s ’ p ric es, ad d on ad d itio n a l e x p e n s e s th at h a v e d e v e lo p e d , e s t im a te the i m p a c t o f price o n d e m a n d , a n d state th e p rice w ith a profit go al in m in d . T h e tra d itio n a l w a y to p ric e n ew p r o d u c t s is to c a lc u la te p ro d u c t io n an d d is trib u tio n c o sts and ad d a d e s ire d profit m a rg in . T h e final P in the m a r k e ti n g m ix is p ro m o ti o n . P r o m o ti o n in v o lv e s p e rs u a d in g p e o p le to u se the p ro d u c t. P r o m o ti o n in c lu d e s a d v e rt is i n g , p u b lic re la tio n s, and p r o m o ti o n a l activ ities.

Financial Plan B u d g e ts are th e y e a rly p la n o f the o rg a n iz a tio n . T h e y c o v e r e x p e c t e d s o u r c e s o f m o n e y an d p re d i c te d e x p e n s e s . T h e b u d g e t m u s t reflec t the p rio ritie s o f the s trateg ic pla n o r the m is s io n o f the o rg a n i z a ti o n w ill n o t b e a c c o m p lis h e d . T h e s trateg ic plan in c lu d e s g e n e ra l b u d g e ta r y prio rities, w h e r e a s th e i n t e r m e ­ diate plan reflects d e ta ils fo r a c q u is it io n s as w ell as d is trib u tio n o f assets. I n t e r­ m e d i a te p la n s g e n e ra l ly in c lu d e d o c u m e n t a ti o n fo r all a n tic ip a te d e x p e n d it u r e s so that c o m p a n y a c c o u n t a n ts c a n a n tic ip a te an d p re d i c t lo s ses an d g a in s c o n ­ n ecte d to the in te rm e d ia te plan.

H u m a n Resources Plan E m p l o y e e p la n n i n g in v o l v e s the d e v e l o p m e n t o f the talen ts, skills, an d a s p i r a ­ tion s o f p e o p le w ith in an o rg a n i z a ti o n . T h e w e ll- d e s ig n e d h u m a n r e s o u rc e s plan a n a ly z e s the ta len ts and skills a firm c u rr e n tly h a s c o m p a r e d w ith fu tu re n eed s. T h e key a re a s f o r m a n i p u la t io n a n d a d j u s t m e n t in h u m a n r e s o u rc e s p la n s in c lu d e : (a) w o r k flo w s ( w h ic h are c o n n e c t e d to eff ic ie n c y , co n tro l, an d jo b de scrip tio n issues), (b) s ta ff ch o ic e s, (c) sta ff sizes (in clu d in g h o w hiring freezes,

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terminations, and early retirements will be handled), (d) perfo rm an ce appraisals, (e) training and dev elo p m ent, ( f ) co m pen satio n, (g) em p loy ee relations (including t o p - d o w n / b o tt o m - u p co m m u nicatio n , feedback, etc.), (h) em ploy ee rights (includ­ ing ethical co des/enforcem ent as well as discipline), and (i) international m a n a g e ­ ment (including the use o f expatriates, country nationals, or other staffing needs). Say a n e w s p a p e r plans to m o v e m o st classified sales to its online p ro d u c t to update ads in a m o re tim ely fashion and offer links to cu stom ers. M a n ag ers h ave to assess w hether to m ake the transition with current advertising staff (w ho are skilled in writing and selling advertising, but not in technology) or hire technologyskilled w o rkers (w h o n eed training in ad vertisin g sales and c o p y w riting). A third possibility is to hire recent co llege gradu ates from adv ertisin g p ro g ra m s (w h o h av e both sets o f skills, b u t little experience). All the ch o ice s are rational, b ut there are d ifferen t costs and benefits asso c i­ ated with each alternative. E v en m ore im po rtan t, the decision should co n n ec t to a c lear te c hn olo gy priority in the c o m p a n y ’s m ission. T h a t w ay training prog ra m s, recruiting efforts, and em p lo y e e ass essm en t p ro ce d u res are p ro active and su g ­ g estive o f an appropriate decision c o n n ec ted to decision s m a n a g e rs are m aking in oth er de partm en ts.

S H O R T -R U N PLANNING Just as in term ed ia te plans serve as m ap s fo r the strategic plan, short-run plans are w ay s to m eet the goals o f the in term ediate plans. H o w e v e r, short-run plan ning is m ost v u lnerable to b e c o m in g reactive. M a n a g e r s re spo nd ing to tem po rary e n v iro n m en ta l or b u sin ess fluctuations m u st assess how long the effects o f the c h a n g es will be a facto r and w h e th e r tho se ch a n g e s can be ignored until stability returns. A firm w ith an inflexible strategic plan has the m o s t difficulty in re sp on din g to change. S uch a firm is m o s t v uln erab le to fo llo w ing a fatal path that drain s reso urces, fails to ad dress im m e d ia te op po rtu n ities, and is o v e rc o m e by m o re alert co m p etitors. H o w e v e r, a firm with an a m b ig u o u s m ission m a y in vest too early in a new p ro d u c t or service, o r it m ay p rem atu re ly a b a n d o n an idea that ju s t n eed s time and effort to succeed. C o n sta n t and c o nsisten t a ss essm en t is critical with shortrun planning.

STRATEGIC PLANNING FOR IN TER N ATIO NA L MARKETS M o v in g into international m ark ets affects a m ed ia c o m p a n y ’s long-term strategic plan. New issues arise that m ust be carefully considered within the co n text o f the overall p lanning process d iscussed earlier. Planning for international operation s is bec o m in g increasingly im portant for m ed ia corporations. O v e r the years, there

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w a s a h a n d fu l o f m u ltin a tio n a l m e d ia c o rp o r a tio n s a n d m e d ia p ro d u c ts su c h as film s an d T V p r o g r a m s e x p o rte d to fo re ig n a u d ie n c e s. H o w e v e r , d u rin g the 1980s an d 1990s, the in te rn a tio n a liz a tio n o f the m e d ia in d u s try g re w d ra m a tic a lly . In 1980, no m a jo r m e d ia p la y e r w as b ased o utsid e N o rth A m e ric a (C o m p a in e & G o m e ry , 2000). B y 1998, few U .S .-b ased firms w e re m a jo r global media. H o w ev er, the U nited States w a s attracting interest from international m edia such as M u r d o c h ’s N e w s C o rp o ra tio n , w hic h is b ased in A u stralia an d has interests in E u ro p e and A sia. N e w s C o r p . ’s m a jo r properties inclu de m ag az in es, b ro a d c a s t T V , cab le n e t­ w orks, film p ro du ctio n an d distribution, an d b o o k publishing . T h e U n ite d States is also attracting in terest from B e rte lsm a n n (a G e r m a n y - b a s e d le ad e r in rec orde d m u sic and b o o k p ub lishing), R e e d -E lse v ie r (a D u tc h - E n g li s h jo i n t ven ture with in­ terests in m ag a z in e s and electronic info services), P earson P L C (bo ok publish ing ) and E M I G ro u p (record ed m usic leader), b oth b ased in L o n d o n , an d So ftb ank (m a g a z in e s and electronic info services) in Jap an ( C o m p a in e & G o m e ry , 2000). D u r in g the s a m e p e rio d that fo re ig n c o m p a n i e s w e re in v e s tin g in the U.S. m e d i a , c o m m u n i c a t i o n c o m p a n i e s in the U n ite d S ta tes w e re b u y in g o r starting c o m p a n i e s o v e rs e a s . T h e e c o n o m i c s o f m e d i a p ro d u c t io n m a k e g lo b a l o p e ra t io n s d e sira b le . O n c e a c o m p a n y c re a te s a m e d i a p r o d u c t suc h as a T V p r o g r a m , film , o r m a g a z in e , it c o sts a lm o s t n o th in g to d is trib u te it to m o r e p e o p le (U .S . D e p a r t ­ m e n t o f C o m m e r c e , 1993). M o r e o v e r , ea ch a d d itio n a l p e rs o n w h o sees a p r o ­ g ra m or m a g a z in e sp r e a d s the c o sts o f p r o d u c i n g it m o r e w id e ly , th e re b y in c r e a sin g the m e d i a c o m p a n y ’s profit. D espite these e c o n o m ic s , m ed ia c o m p a n ie s interested in international ex pansion face significant barriers. M o s t nations, including the U n ited States have had laws limiting or fo rb idd ing foreign o w n e rsh ip o f m e dia c o m p a n ie s. S u c h law s protect d om estic m edia industries from foreign co m p etitio n and co n c e rn s th at foreign o w n ­ ers m ig h t in fluence co n te n t a nd public op inio n in tim es o f w a r o r n ational crisis. R e ­ strictions on foreign o w n e rsh ip g enerally w ere m o s t strin gen t for telep ho ne sy ste m s, T V , and radio stations. M a g a z in e c o m p a n ie s and b o o k pu blishers tended to b e less reg ulated so foreign o w n e rsh ip w as m o re c o m m o n in th ese m e d ia sectors. M a n y c o u n tr ie s also re s trict m e d i a im p o rts . E u r o p e an d C a n a d a h a v e had strict q u o ta s on the im p o rta tio n o f U .S . - p r o d u c e d film s an d T V p r o g r a m m i n g ( G e r s h o n , 1997). C ritic s o f im p o r t e d m e d i a fe a r the s h e e r v o lu m e o f re lativ e ly i n e x p e n s iv e U .S . film and T V p ro d u c t s will in h ib it d o m e s ti c activ ity. P lus, the v a lu e s s h o w n in th ese U .S . film s an d T V m a y u n d e r m in e n atio n a l c u ltu re s and v a lu e s — a p ro c e s s k n o w n as c u lt u r a l im p e ria lis m .

Expanding M arkets In the 1980s and e a rly 1 9 90s, a n u m b e r o f fa c to rs c a m e to g e t h e r to e n c o u r a g e W e s t e r n c o u n tr ie s to o p e n m e d i a m a r k e ts to f o r e ig n in v e s tm e n t. Im p r o v e d c o m ­ m u n i c a ti o n and tra n s p o rta tio n te c h n o l o g ie s m a d e it e a s i e r fo r c o r p o r a ti o n s to

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e x p a n d into n e w m a r k e ts , so c o m p a n i e s in m a n y in d u s trie s a r o u n d th e w o rld b e g a n to g lo b a liz e th e ir o p e ra tio n s. M u l ti n a ti o n a l c o m p a n i e s n eed h ig h ly d e v e lo p e d in f o r m a t io n - tr a n s f e r s y s te m s su c h as c o m p u t e r n e tw o r k s , so p h is tic a te d te l e p h o n e s y s te m s , and d a ta b a s e s to ru n e x p a n d e d o p e r a t io n s (U .S . H o u s e o f R e p r e s e n t a ti v e s 1980, 1981a, 1981b). T h a t n eed p uts p r e s s u re on g o v e r n m e n ts to d e re g u l a te th e ir d o m e s ti c t e l e c o m ­ m u n i c a ti o n s in d u s trie s to p ro v i d e c o n s u m e r s an d b u s i n e s s e s a c c e s s to the latest te c h n o l o g ie s an d s e r v ic e s r e g a r d le s s o f w h e t h e r th ey arc p r o v i d e d by d o m e s ti c or fo r c ig n - o w n c d p ro v id e rs. C o n c u r r e n t ly , th ere w a s a m o v e m e n t to re d u c e trade b a rrie rs b e tw e e n n a tio n s b e c a u s e free in te rn a tio n a l trad e c re a te s g re a t e r e c o n o m i c e ffic ie n c ie s, h e lp s b u s i ­ ne ss, an d p r o v i d e s c o n s u m e r s w ith m o r e p r o d u c t c h o ic e s fo r l o w e r p rices. T h e n e e d fo r a c c e s s to the b e st c o m m u n i c a t i o n te c h n o l o g y an d se rv ic e s, an d th e d e ­ sire to r e d u c e trad e b a rrie rs in g e n e ra l, led m a n y d e v e lo p e d n a tio n s to r e e v a l u a te th e ir m e d i a o w n e r s h i p limits. T r a d e a g r e e m e n ts s i g n e d d u ri n g the p e rio d , i n c l u d ­ ing the E u r o p e a n U n io n a g r e e m e n t b e tw e e n E u r o p e a n n a tio n s ( G e rs h o n , 1997) and the N o rth A m e r i c a n F re e T r a d e A g r e e m e n t ( N A F T A ) a m o n g the U n ited S ta tes, C a n a d a , an d M e x i c o , in c l u d e d specific p ro v i s io n s to e n c o u r a g e the o p e n ­ ing o f m e d i a m a r k e ts to fo re ig n trad e and in v e s tm e n t. C h a n g e s in the in te rn a tio n a l e c o n o m y an d b u s i n e s s e n v i r o n m e n t p re s s u re d d e v e lo p e d c o u n tr ie s to m a k e it e a s i e r fo r m e d i a c o m p a n i e s to o p e ra te in t e r n a ­ ti o n a lly j u s t as c h a n g e s w ith in th e m e d i a in d u s try e n c o u r a g e d m e d i a firm s to ta k e that step. T h e g r o w th o f the g lo b a l e c o n o m y e n c o u r a g e d m a n y m e d i a c o m ­ p a n ie s to b u y m e d ia o p e r a t io n s in f o r e ig n c o u n tr ie s w h e r e it w a s a llo w e d . F in a lly , m e d i a c o m p a n i e s in v e s te d o v e rs e a s o r d e v e lo p e d j o i n t v e n tu r e s w ith fo r e ig n p a rtn e rs to g e t a r o u n d the lim ita tio n s s o m e n a tio n s p la c e d on the fo reig n im p o r t o f m e d i a p ro d u c t s . O v e r s e a s in v e s t m e n t b e c a m e a w a y to m a i n ta i n and in c r e a s e fo re ig n e x p o rt s (C a rv e th , 1992; G e r s h o n , 1997). A s m e d i a g lo b a liz a tio n c o n ti n u e s , it b e c o m e s in c r e a s in g ly likely th a t p r o f e s s i o n a ls in all ty p e s o f m e d ia will w o r k fo r a c o m p a n y h a v in g o v e rs e a s h o ld i n g s or o w n e d by a fo re ig n c o m ­ p a n y . T h u s , a m b i ti o u s m e d i a m a n a g e r s m u s t p re p a r e to m e e t the p la n n i n g c h a l ­ le n g e s a n d o p p o r t u n it ie s p r e s e n te d a c ro s s c u lt u re s an d b o rd e rs.

Business Record A s w ith d o m e s ti c c o m p a n i e s , strateg ic p la n n i n g fo r in te rn a tio n a l m e d i a o p e r a ­ tio ns b e g in s w ith e x a m i n in g the b u s i n e s s e n v i r o n m e n t an d p a st p e rf o r m a n c e s o f th e c o u n tr y or c o u n tr ie s w h e re a firm is c o n s i d e r in g in v es tin g . T h e q u e s t io n s raised , h o w e v e r , are s o m e w h a t d if fe re n t th an th o s e a m a n a g e r f a c e s w h e n e x a m ­ in in g a h o m e m a r k e t an d c o m p a n y . N u m e r o u s fa c to rs in flu e n c e a d e c is io n a b o u t w h e r e to in v e s t, in c l u d in g th e stre n g th o f the lo c al e c o n o m y , r e g u l a to r y e n v i r o n ­ m e n t fo r m e d i a , la n g u a g e and c u ltu ra l d if fe re n c e s that m a y a ffe ct h o w m e d i a are

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re c e iv e d , an d w h a t a d v e rtis in g m i g h t be sold to s u p p o r t th e m e d i a p ro d u c t. T h e s e fa c to rs also a ffect w h ic h m e d ia p r o d u c t (s ) are d e v e lo p e d . M e d i a p ro d u c t s are g e n e ra lly lu x u r y item s. If m o s t o f a c o u n t r y ’s re s id e n ts live a m e a g e r e x is te n c e w ith little o r no d is p o s a b le i n c o m e , the m a r k e t fo r m e d ia p ro d u c t s is g e n e ra l ly w e a k . A d v e r ti s e r s are no t in te re ste d in r e a c h i n g c o n s u m e r s w ith little p o te n tia l b u y in g p o w e r. In co n tra st, c o u n tr ie s w ith s tro n g e c o n o m i e s g e n e ra lly h a v e h ig h ly d e v e lo p e d m e d i a m a r k e ts an d s tiff a d v e rtis in g c o m ­ p etitio n . A m a n a g e r e n g a g e d in in te rn a tio n a l strateg ic p la n n i n g m u s t b a la n c e a n a ly s is o f the c o u n t r y ’s e c o n o m i c c o n d it io n s a g a in s t w h a t is k n o w n a b o u t the c o m p e titio n . J u s t as w h e n E a s te r n E u r o p e w a s o p e n e d , m e d i a m a n a g e r s ca n s p o t c o u n tr ie s th a t la ck a stro n g e c o n o m y o r m e d i a in d u s try , b u t are s h o w in g sig n s o f g r o w th in b o th areas. M e d i a c o rp o r a ti o n s fro m E u r o p e an d N o rth A m e r i c a in v e s te d h e a v ily in E a ste rn E u r o p e a n c o u n tr ie s a fte r the E a ste rn B lo c c o ll a p s e d in 19 89 . O w n e r ­ ship o f larg e s e g m e n ts o f E a s te r n E u r o p e ’s p rin t m e d i a p a s s e d into the h a n d s o f fo re ig n c o m p a n i e s (H o llifie ld, 19 9 3 ; S u k o s d , 1992 ). O th e r o p p o r t u n it ie s a rise w h e n d e v e lo p e d c o u n tr ie s d e r e g u l a te o r p riv a tiz e m e d i a secto rs. G e r m a n y h a d tw o p u b lic ly o p e r a t e d T V n e tw o r k s u ntil 1984 w h e n it p e rm itte d c o m m e r c i a l b ro a d c a s ti n g , w h ic h e x p a n d e d ra p id ly . A lth o u g h G e r m a n c o m p a n i e s la rg e ly c o n tr o l c o m m e r c i a l T V th ere, s o m e fo re ig n m e d i a en te r p ris e s su ch as th e N e w s C o r p o r a t io n Ltd. an d W a lt D is n e y C o. h a v e h o l d ­ in gs in G e r m a n T V ( H o lt z - B a c h a , 1996).

Regulatory Restrictions M e d i a m a n a g e r s m u s t c a re f u lly e v a lu a te n a tio n a l r e g u l a to r y e n v ir o n m e n t s . O th e r n a ti o n s m a y r e q u ire m e d i a c o m p a n i e s th at b u y fo re ig n m e d ia to sh a r e p a r ­ tial o w n e r s h i p w ith d o m e s ti c p a rtn e rs. M e d i a c o n te n t and c o p y r i g h t r e g u la tio n s can be t r o u b le s o m e . S o m e c o u n tr ie s h a v e n o t s ig n e d in te rn a tio n a l c o p y r i g h t a g r e e m e n ts an d o th e rs do n o t e n fo r c e in t e rn a t io n a l c o p y r i g h t law s, m a k i n g p r o ­ d u c tio n o r d is trib u tio n o f m e d i a p ro d u c t s there p a rtic u la rly v u ln e r a b le . A m e d i a c o m p a n y e n te r in g th ese c o u n tr ie s m a y h a v e d ifficu lty p ro t e c ti n g its p u b li c a ti o n s or p r o g r a m s fro m illegal c o p y in g o r p iratin g . P ira tin g is a lr e a d y w i d e s p r e a d in the r e c o r d in g an d so f tw a re in d u stries. T h e s e e c o n o m i c an d r e g u l a to r y d e c is io n s i m p a c t w h a t m e d i a p ro d u c t s a c o m ­ p a n y s h o u ld a tt e m p t to p r o d u c e a n d /o r sell o v e rs e a s . If a m a r k e t ’s e c o n o m y is w e a k d u e to a p o te n tia l a u d i e n c e ’s lim ite d d is p o s a b le i n c o m e , d e v e lo p p u b l i c a ­ tio ns o r p ro g r a m s tha t giv e a u d ie n c e s u sefu l in f o rm a t io n su ch as h o m e r e p a i r or se w in g ra th e r than u n n e c e ss a ry fashion o r g o ss ip p ro g r a m m i n g . C o n te n t r e g u l a ­ tions c o u ld also affect a m e d ia m a n a g e r ’s c h o ic e o f w h a t to p ro d u c e. G re a t B ritain, fo r e x a m p le , has m o re restrictio ns than the U n ite d States on w h a t m e d ia ca n report a b o u t c ri m i n a l ju s ti c e p r o c e e d i n g s an d o fficia l secrets. S o m e p h o to g r a p h s and

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m a g a z in e a d v e r t is e m e n ts d e p ic tin g w o m e n in U n ite d S tates w o u ld be d e e m e d p o rn o g r a p h y in s o m e M i d d le E a s te r n c o u n tr ie s . S u c h r e g u l a ti o n s c a n m a k e it m o r e d ifficult to p r o d u c e c o n te n t and sell a d v e rtis in g o v e rs e a s.

Education, C ulture, and Language E d u catio n al, cultural, and la n g u a g e d iffe ren ce s also affect p ro d u c t and m ark et ch oices. A p u b lish in g c o m p a n y m a n a g e r m u s t c o n s id e r literacy rates b e c a u se m o s t o f a c o u n t r y ’s p o p u la tio n m u s t read to be a th riv in g m a r k e t fo r m a g a z in e s, b o o k s , and n e w s p a p e rs . If o nly a sm all p e rc e n ta g e o f the p o p u la tio n is c o m p u t e r literate o r has ac cess to c o m p u te rs , on lin e m e d ia se rv ices are not likely to be successful. C u ltu ra l d i f fe re n c e s are critical as w ell. B y n a tu re , m e d i a m i r r o r an d in flu en ce the c u lt u re in w h ic h th ey are c re a t e d a n d sold. T h a t is w h y so m a n y c o u n tr ie s w o rry a b o u t cu ltu ra l im p e ri a li s m from f o r e ig n - p r o d u c e d m e d ia . A m e d i a m a n a g e r m u s t th o r o u g h ly u n d e r s ta n d th e local c u ltu re o f th e c o u n ­ try w h e r e a c o m p a n y

p la n s

to invest. C u ltu ra l d i f fe re n c e s

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m e d i a c o n t e n t an d a d v e rtis e rs are re c e iv e d . F o r e x a m p l e , h u m o r is c u ltu ra lly b a s e d , p la y in g o f f su b tle s itu a tio n s o r w o r d s f a m il ia r to p e o p le in o n e c u ltu re , b u t n o t th e ir n e ig h b o r s o v e r the b o rd e r. H u m o r o u s c o n te n t d o e s n o t ten d to travel well. M e d i a c o n te n t is l a n g u a g e b ased so it m u s t be a v a ila b le in th e local la n ­ g u a g e to re ach an o v e rs e a s a u d ie n c e . T h is m e a n s d u b b in g film s and v id e o or a d d in g sub titles. P u b li c a ti o n s m u s t be tr a n sla te d , w h ic h is difficu lt an d h a s a high risk o f erro r, o r p r o d u c e d lo cally by n a tiv e s p e a k e r s in the o v e r s e a s m a r k e t. S u c c e s s f u l ad c a m p a i g n s o r p r o d u c t n a m e s m a y n ot tra n sla te w e ll into o th e r la n g u a g e s . E n g lis h h a s b e c o m e the d o m i n a n t l a n g u a g e o f the n ew e le c tro n ic m e d ia . Y e t tha t m e a n s n o n -E n g li s h s p e a k e r s c a n n o t a c c e s s E n g li s h - b a s e d e le c tro n ic m e d i a c o n te n t an d a d v e r t is e m e n ts . S o m e c o u n tr ie s fe a r the g r o w in g i m p o r t a n c e o f n ew m e d i a a n d its d o m i n a ti o n by E n g li s h w ill u n d e r m in e lo cal la n g u a g e s . C e rta in g o v e r n m e n t s re q u ire ele c tro n ic c o n te n t an d m e d i a p r o d u c t s o ff e re d lo ­ cally to b e in the ir n atio n a l la n g u a g e . So m e d i a c o m p a n i e s an d a d v e rtis e rs m a k ­ ing th e ir c o n te n t av a ila b le to in te rn a tio n a l a u d ie n c e s m u s t h a v e it tra n sla te d or dubbed.

Evaluate Resources S e v e r a l im p o r t a n t is su es s u r fa c e w h e n e v a lu a tin g a v a il a b le r e s o u rc e s to s u p p o r t in te rn a tio n a l e x p a n s i o n . T h e m a n a g e r m u s t d e c id e w h a t the c o m p a n y ’s p rim a ry g o a l is b e c a u s e th at a n s w e r w ill in flu en ce o th e r a n s w e r s to k e y d e c is io n s a b o u t

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in te rn a tio n a liz in g o p e ra tio n s . O th e r is su e s in c lu d e w h e t h e r the firm s h o u ld e n te r the fo re ig n m a r k e t by ta k in g its o w n p r o d u c t in o r a c q u ir in g e x is tin g m e d i a c o m ­ p a n ie s there. A n o t h e r c o n c e rn is h o w the new v en tu re is fin anc ed and h o w m u c h financial risk the c o m p a n y w a n ts to incur. T h o s e issu es raise q u e s tio n s o f w h e th e r the i n v e s tm e n t s h o u ld be m a n a g e d th r o u g h a w h o lly o w n e d s u b s id ia r y , p a r t n e r ­ sh ip, s trateg ic allia n c e , lic e n sin g , or o t h e r o w n e r s h i p stru ctu re . T h e c o m p a n y then d e c id e s h o w to o r g a n i z e an d m a n a g e the n ew v e n tu r e an d find the h u m a n r e s o u rc e s n e c e s s a ry f o r su c c e s s. T h e first issu e is e sta b lis h in g the p rim a ry go al fo r o v e rs e a s o p e ra tio n s. B artle tt an d G h o s h a l ( 1 9 89 , 19 9 0 ) id entified fo u r p ri m a ry m o d e l s (in te rn a tio n a l, m u l ti n a ti o n a l, g lo b a l, and tr a n s n a tio n a l) for m a n a g i n g c r o s s - b o r d e r o p e ra t io n s a n d the g o a ls th at d riv e th o se m o d e ls.

Four M o d e ls T h e in t e r n a t i o n a l m o d e l d efin es c o m p a n i e s tha t u se o v e rs e a s o p e r a t io n s to d i s ­ tribu te th e ir d o m e s ti c p ro d u c t s in fo re ig n m a r k e ts . T h u s , the o v e r s e a s o p e ra tio n is seen as s e c o n d a r y to the c o m p a n y ’s m a i n p u rp o s e . H u m a n re s o u r c e s c o n tr o l an d m o s t k n o w l e d g e n e e d e d to p r o d u c e the p r o d u c t o f th e fo re ig n o ffice stay w ith c o m p a n y h e a d q u a r t e r s . In f o r m a t io n flo w s o n e w a y fro m c o m p a n y h e a d ­ q u a rte rs to th e o v e rs e a s o p e ra t io n , w h ic h is e x p e c t e d to retu rn little to the p a re n t c o m p a n y b e s id e s profits (B artlett & G h o s h a l, 1989, 1990). O n e e x a m p l e o f the in te rn a tio n a l m o d e l is T V c o m p a n i e s that e s ta b lis h o v e r s e a s j o i n t v e n tu r e s to sk irt im p o rt q u o ta s on d o m e s ti c a ll y p ro d u c e d p ro g r a m m i n g . T h e m u l t i n a t i o n a l c o m p a n y p la c e s m o r e e m p h a s i s o n f o r e ig n o p e ra tio n s , u sin g its su b s id ia r ie s to d e v e lo p d if fe re n t p r o d u c t s fo r d if fe re n t m a r k e ts . It m o d i ­ fies its stra te g ie s an d m a n a g e m e n t p ra c tic e s to m a x i m i z e e ff icien cy in e a c h c o u n ­ try w h e r e it o p e ra te s . T h e e m p h a s is is on p r o d u c i n g lo cal p r o d u c t s tha t are s p ec ific ally ta ilo re d to local m a r k e ts . In m u l ti n a ti o n a l c o m p a n i e s , m a n a g e r s arc o fte n h ir e d loca lly a n d o p e ra te w ith a fa ir a m o u n t o f in d e p e n d e n c e fro m c o m ­ p a n y h e a d q u a r t e r s in m a k i n g da ily d e c is io n s. A m u ltin a tio n a l c o m p a n y m i g h t b e seen as a series o f s e m i - i n d e p e n d e n t but a ffiliated n atio n a l c o m p a n i e s w ith s i m i la r b u t d is tin c t p r o d u c t lines (B a rtle tt & G h o s h a l, 1989, 1990). T h is stra te g y m a x i m i z e s the re l e v a n c e o f the c o m p a n y ’s p r o d u c t s to its lo cal a u d ie n c e , b u t le s s e n s the c o m p a n y ’s ab ility to c a p tu r e e c o n o m i e s o f scale. N e w s p a p e r c o m p a n i e s b a s e d o u ts id e the U n ite d S ta te s th at o w n m a n y U .S. n e w s p a p e r s are an e x a m p l e o f this m o d e l . E a c h n e w s p a p e r is p ro d u c e d for a local a u d ie n c e . O n ly s o m e o f the c o p y from any g iv e n n e w s p a p e r is sh a re d w ith o t h e r U .S . p a p e rs . E v e n less is o f in te re st to n e w s p a p e r s in the h o m e c o u n tr y . G l o b a l c o m p a n i e s v ie w the e n tire w o rld as th e ir m a r k e t, d e s i g n in g an d p r o ­ d u c in g p r o d u c t s to be sold u n iv e r sa lly . G lo b a l c o m p a n i e s m a x i m i z e p ro d u c t io n

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e fficien cies, a s s u m in g c o n s u m e r s in all n a tio n s w a n t b asic a lly the s a m e thin gs. M o s t m a n a g e m e n t p la n n i n g and d e c is io n m a k i n g are m a d e in w o r l d w i d e h e a d ­ q u a rte rs, a lt h o u g h p ro d u c t io n m a y be sc a tte re d a r o u n d the g lo b e (B a rtle tt & G h o s h a l, 1989, 1990). M a g a z i n e p u b li s h e r s o fte n take this a p p r o a c h , p u b lis h in g m a g a z in e s r e p r o d u c e d by o n e c o m p a n y in m u ltip le c o u n tr ie s w ith o n ly m i n o r a d ju s tm e n ts to c o n te n t a n d tra n sla tio n . T h e U .S . film an d T V in d u s trie s ta k e a g lo b a l a p p r o a c h to film p ro d u c t io n . In r e c e n t d e c a d e s , th e large b u d g e ts re q u ire d to m a k e film s m a d e it n e c e s s a ry fo r H o l l y w o o d p r o d u c e r s to tak e f o r e ig n film m a r k e ts into a c c o u n t. O v e r s e a s a u d i ­ e n c e s ca n m a k e the d i f fe re n c e in profit m a r g in s . F o re i g n a u d ie n c e s h a v e thu s b e ­ c o m e m o r e th an a s e c o n d a r y m a r k e t to H o l l y w o o d stu d io s, p r o d u c i n g film s w ith g lo b a l p o p u la r it y in m in d . H o w e v e r , C a r v e th ( 1 9 9 2 ) an d T u r o w ( 1 9 9 2 ) s u g ­ g e ste d this m a y be c h a n g in g . E u r o p e a n a u d ie n c e s a re in c r e a s i n g ly in te re ste d in film s w ith E u r o p e a n c o n te n t, w h ic h m a y e v e n tu a lly m o v e the film in d u s try to a d o p t the tr a n s n a tio n a l m o d e l. T h e t r a n s n a t i o n a l m o d e l o f in te rn a tio n a l m a n a g e m e n t b e g a n to e m e r g e in the m i d - 1 9 8 0 s and 1990s. It m e r g e s the best o f the o th e r m o d e l s w h ile b e c o m i n g m o r e re s p o n s iv e to c o n s u m e r s ’ in c r e a s in g d e m a n d s th a t p ro d u c t s be at least s o m e w h a t lo c a liz e d . T h e tr a n s n a ti o n a l c o m p a n y is n e it h e r c e n tr a liz e d in the h o m e m a r k e t o r g lo b a l h e a d q u a r t e r s n o r d e c e n t ra li z e d in all o f its o u tl y in g o p e r a ­ tio ns. In s te a d d if fe re n t su b s id ia r ie s a re a ss ig n e d d if fe re n t sp e c ia ltie s and g iv e n the r e s o u rc e s an d re s p o n s ib ilitie s to p r o d u c e th e m . T h is m a k e s the c o m p a n y flexible an d re s p o n s iv e in m e e tin g lo cal n e e d s w h ile still b ein g able to c o m b i n e the e ffo rts o f its d if fe re n t o v e rs e a s o p e r a t io n s to g a in e ffic ie n c ie s in p ro d u c tio n an d e c o n o m i e s o f scale. N a tio n a l it y is d e li b e ra t e ly d o w n p l a y e d b e c a u s e the o rg a n i z a ti o n re c r u its o n a w o r l d w i d e o r r e g i o n a l b a sis fo r th e b e s t p e o p le to fill m a n a g e m e n t p o sitio n s. M a n a g e r s are d y n a m i c e m p l o y e e s w h o id e n tify w ith o r g a n i z a ti o n a l g o a ls ra th e r th an p ro v in c ia l o n es. C o r p o r a t e m a n a g e r s w ill sh are p la n n i n g d a ta w ith o v e rs e a s s u b s id ia r ie s. T h e s e o p e ra t io n s c o n s t a n tl y sca n th e ir lo cal e n v i r o n m e n t s fo r new p r o d u c t id eas , n e w m a r k e ts , an d n e w e ffic ie n c ie s to sh are w ith c o rp o r a te o p e r a ­ tion s a r o u n d the g lo b e (B a rtle tt & G h o s h a l, 1989, 199 0). T h is tw o - w a y learn in g p r o c e s s is a k e y d is ti n g u is h i n g e le m e n t o f the tr a n s n a tio n a l m o d e l. T h e truly tra n s n a tio n a l m a n a g e r re c o g n i z e s that a p r i m a r y b e n e fit o f o p e ra t in g in w o r l d ­ w id e m a r k e ts is the ability to learn fro m the p e o p le in th o s e m a r k e ts an d gain n e w id ea s fo r b e tte r p r o d u c t s a n d b e tte r w a y s to d o b u sin e ss. T h e r e c o r d in g in d u s try fits the tr a n s n a tio n a l m o d e l in so m e re s p e c ts. B u rn e tt ( 1 9 9 2 ) said a h a n d fu l o f m u l ti n a ti o n a l m e d i a c o m p a n i e s c o n tr o l the w o r ld w id e r e c o r d in g in d u s tr y — up to 8 0 % o f the m a r k e t in s o m e c o u n tr ie s . A s c o n s o l i d a ­ tion in the in d u s try in c r e a s e d , so did the n u m b e r o f n e w artists a n d d iv e rsity o f m u s ic a v a ila b le to c o n s u m e r s . B u r n e tt said this is d u e to the m u l t i n a t i o n a l s ’ stra te g y o f affiliating w ith s m a ll s e m i - i n d e p e n d e n t r e c o r d in g lab els w o r ld w id e ,

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w h ic h the n s e a r c h th e ir lo cal m u s ic s c e n e s f o r n e w talent. T h e s e s m a ll labels c o n s t a n tl y in t r o d u c e n ew m u s ic an d artists to m a r k e t lo cally and re g io n a lly . T h e m u lti n a ti o n a ls th e n d is trib u te m o r e w id e ly if th ey b e lie v e th e s o u n d has w id e r ap pe al.

Entering M arkets A f te r a m e d i a c o m p a n y sets its g o a ls fo r in te rn a tio n a l e x p a n s i o n , it d e c id e s ho w to e n te r its c h o s e n fo re ig n m a r k e t. T h e r e a re tw o basic a p p ro a c h e s : start its o w n o v e rs e a s o p e r a t io n s o r a c q u ir e an e x is tin g m e d i a c o m p a n y in th a t c o u n tr y . If the p ri m a ry g o a l is to be an in te rn a tio n a l c o m p a n y an d u se its o v e rs e a s o p e ra t io n s as a s e c o n d a r y m a r k e t fo r e x is tin g p ro d u c t s , it is u n lik e ly to e n te r a fo re ig n m a r k e t by b u y in g a n o th e r c o m p a n y an d its p r o d u c t line. H o w e v e r , m u ltin a tio n a l, g lo b a l, o r tr a n s n a tio n a l o p e r a t io n s m i g h t b e a c c o m ­ p lis h e d th r o u g h start-u p s o r a c q u is itio n s . A c q u is i ti o n s allo w the b u y e r to e n te r the n e w m a r k e t w ith an a lr e a d y e s t a b li s h e d p ro d u c t , re d u c i n g th e risk o f the in ­ v e s t m e n t . M u c h o f the g lo b a liz a tio n tha t to o k p lace d u ri n g the 1980s an d 1990s w a s a c c o m p lis h e d th r o u g h m e d i a m e r g e r s an d a cq u is itio n s. N e x t, the n ew v e n t u r e ’s o w n e r s h i p stru c tu re is p la n n e d . A s w ith d o m e s ti c o p ­ e ra tio n s, th e o w n e r s h i p stru c tu re d ire c tly a ff e c ts its a v a ila b le so u r c e s o f cap ital. T h e s i m p l e s t a p p r o a c h is to set up a w h o lly o w n e d su b s id ia r y o v e r s e a s o r a c o m ­ p a n y the p a re n t c o m p a n y o w n s an d o p e ra t e s en tirely . T h is sim p lifies d ecis io n m a k i n g and le av e s little r o o m fo r m i s u n d e r s t a n d i n g s a m o n g c o - o w n e r s from d i f ­ fe r e n t c o u n tr ie s. H o w e v e r , r u n n i n g a w h o lly o w n e d s u b s id ia r y m e a n s the p a r e n t c o m p a n y c a n ­ n o t learn a b o u t the n e w m a r k e t from a local c o - o w n e r o r a n o th e r c o m p a n y w ith e x p e rt is e there. T h e c o m p a n y m u s t s h o u l d e r all the fin an cia l b u r d e n o f the f o re ig n in v e s tm e n t. T h is b u r d e n can be c o n s i d e r a b l e d u e to a d d itio n a l tr avel, s h i p p in g , an d c o m m u n i c a t i o n c o sts b e tw e e n the s u b s id ia r y a n d h e a d q u a rte rs . A s a re sult, it u su a lly ta k e s se v e ra l y ea rs fo r a f o r e ig n i n v e s tm e n t to b e c o m e p rofitable.

Partnerships A n o t h e r o p tio n is to set up a jo i n t v e n tu r e o r s trate g ic a llia n c e w ith o n e o r m o r e p a rtn e rs. In this a r r a n g e m e n t , p a rtn e rs sh are d e c is io n m a k i n g as w ell as th e risk s, c o sts, and u ltim a te ly th e su c c e s s o f th e fo re ig n in v e s tm e n t w h e n it b e c o m e s p r o f ­ itable. M a n y c o u n tr ie s r e q u ire f o r e i g n - o w n e d m e d i a c o m p a n i e s o p e r a t in g w ith in th e ir b o rd e r s to h a v e at least o n e local p a rtn e r. S tra te g ic a llia n c e s w ith lo cal

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p ro d u c e r s also are a m e a n s fo r f o r e ig n m e d i a c o m p a n i e s to gain a c c e s s to r e s tric ted m e d i a m a r k e ts. H a v in g a local p a r t n e r is p a rtic u la rly v a lu a b le b e ­ c a u s e the p a rt n e r p ro v i d e s c o n ta c ts (w ith g o v e r n m e n t, in d u s try , and clien ts), a d v ic e

on

d e v e lo p i n g

c u ltu ra lly

a p p r o p r ia t e

an d

a ttractiv e

c o n te n t ,

and

h e lp s th e n e w v e n tu r e a v o id the in e v ita b le m i s t a k e s o f d o in g b u s i n e s s in a n ew e n v ir o n m e n t . T h e r e are sig n ific a n t a d v a n ta g e s to j o i n t v e n tu r e s e v e n w h e n the p a r t n e r is not a lo ca l c o m p a n y . S trateg ic allia n c e s h e lp c o m p a n i e s sh a r e k n o w l e d g e , tap new i n n o v a t io n s , an d

sh are the c o sts o f t e c h n o l o g y d e v e lo p m e n t, e s p e c i a ll y in

t e c h n o l o g y - i n te n s i v e m e d i a sp ecialties. H o w e v e r , the d is a d v a n ta g e s in c lu d e the d is a g r e e m e n ts th a t arise o v e r s tra te g ie s a n d d e c i s i o n - m a k i n g a u th o rity . T h e re can be cu ltu ra lly b a se d m i s u n d e r s ta n d i n g s a m o n g p a rt n e rs fro m d if fe re n t c o u n ­ tries. A c o m p a n y c o u ld use the a llia n c e to gain p r o p r ie ta ry k n o w l e d g e o f the d o m i n a n t p a r t n e r ’s p r o d u c t line, later d is s o lv i n g the jo i n t v e n tu r e to use th at k n o w l e d g e to c o m p e t e a g a in s t its f o r m e r pa rtn er. F in ally , if o n e p a r t n e r is fin an ­ cially w e a k e r tha n the o th er, p r o b l e m s can arise if the n e w s u b s id ia r y p e r f o r m s b e lo w e x p e c t a tio n s a n d m u s t b e s u b s id iz e d l o n g e r th an p la n n e d . A third a p p ro a c h to o v e r s e a s in v e s tm e n t is lic e n sin g , w h e r e a m e d i a c o m p a n y sells a n o th e r c o m p a n y th e rig h ts to p r o d u c e specific m e d i a p ro d u c t s in a f o r e ig n m a r k e t. T h e c o m p a n y b u y in g th e rig h ts a s s u m e s all risks o f m a k i n g a s u c c e s s fu l e n tr y into th e n e w m a r k e t. T h e p a re n t c o m p a n y u s u a lly s u p p lie s the c o n c e p t , g ra p h i c s , and d e s ig n e le m e n ts , w h e re a s the c o m p a n y th a t b u y s the li­ c e n s e is r e s p o n s ib l e for p r o d u c t tr a n sla tio n , p ro d u c t io n , and d is trib u tio n . T e l e v i ­ sion p r o g r a m s suc h as “W h e e l o f F o r t u n e ” an d “ A m e r i c a ’s F u n n ie s t H o m e V i d e o s ” an d m a g a z in e s h a v e b een licen sed to E u r o p e a n an d o v e r s e a s m e d ia com panies. A lic e n sin g a r r a n g e m e n t a ll o w s the se ller to w id e n the d is trib u tio n o f its p u b ­ lica tio n o r p r o g r a m m i n g w ith m i n i m a l risk an d fina ncia l in v e s tm e n t. T h e li­ c e n s e e , in turn, g a in s the rig h ts to a p ro v e n an d s u c c e s sfu l m e d ia p ro d u c t, m a k i n g it e a s ie r to find an a u d ie n c e a n d a d v e rtise rs. Y e t lic e n se fee s g re a tly r e ­ d u c e the d ir e c t g a in the c r e a tin g c o m p a n y r e c e i v e s fro m h a v in g its p r o d u c t in a n e w o v e rs e a s m a r k e t. T h e l i c e n s o r lo se s c o n tr o l o v e r p ro d u c t io n o f its p u b li c a ­ tion or p ro g r a m , m a k i n g it difficult to e n s u r e th a t high sta n d a rd s o f q u a lity are m a in ta in e d . If th e lic e n s e e fails in the n ew m a r k e t, it m a y be difficult fo r the c r e ­ atin g c o m p a n y to r e e n t e r the m a r k e t w ith th a t p u b lic a tio n o r p ro g r a m using a d i f ­ fe r e n t lic e n se e or a n o th e r a rr a n g e m e n t . In s u m m a r y , o n c e a c o m p a n y e v a lu a te s the b u s i n e s s e n v i r o n m e n t , p e r f o r ­ m a n c e o f a p o te n tia l o v e rs e a s m a r k e t, an d the r e s o u rc e s a v a ila b le for its e x p a n ­ sio n, the p la n n i n g p r o c e s s b e c o m e s m o r e s i m i la r to d o m e s ti c strateg ic p la n n in g . P la n n i n g g o a ls are refin ed f u r th e r an d o p e ra t io n a l iz e d . A lte r n a ti v e a p p r o a c h e s are sele c te d to m e e t, im p le m e n t, m o n ito r , e v a lu a te , an d a d ju s t the pla n an d go als. E a c h o f th e se steps, h o w e v e r , is c a rr ie d o u t in the c o n te x t o f the c o m p a n y ’s o r i g ­ in al in t e rn a t io n a l iz a t io n g o a ls , its a n a ly s is o f the targ et c o u n t r y ’s b u s in e s s

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e n v i r o n m e n t , its d e c is io n s a b o u t h o w its fo re ig n o p e ra t io n s are s tru c tu r e d , and the effe c ts th o s e stru c tu r e s h a v e on a v a ila b le re s o u rc e s.

IN T E R N A T IO N A L IN T E R M E D IA T E P L A N N IN G W h e n the c o m p a n y e n te rs the in te rm e d ia te p la n n i n g p ro c e s s , m a n a g e r s face a d ­ d itio n a l is su es specific to t r a n s b o r d e r m e d ia m a n a g e m e n t . P a rtic u la r a tten tio n is pa id to the p r o d u c t o r s e r v ic e a s p e c t o f the o v e rs e a s m a r k e ti n g plan.

In ternatio n al M a rk e tin g A g a in the e c o n o m y , re g u la to r y e n v i r o n m e n t , an d c u ltu re a ff e c ts a m e d i a c o m ­ p a n y ’s c h o ic e o f the p u b lic a tio n s , p r o g r a m s , o r o th e r se rv ic e s to d is trib u te. C u l ­ tu ral fa c to rs are c a re f u lly a n a ly z e d e v e n after a m e d i a firm d e c id e s to d is trib u te a p a rtic u la r p ro d u c t. O fte n d if fe re n c e s are so su b tle th e y are difficu lt fo r a n o n ­ n a tiv e m a n a g e r to re c o g n i z e , b u t th o s e d if fe re n c e s ca n s ig n al su c c e s s o r failu re fo r the n e w fo re ig n v e n tu re . S a y a m a g a z in e o r T V p r o g r a m fe a tu re s r e c ip e s o r c o o k i n g tips. T h e p r o d u c ­ ers m u s t e n s u r e th e r e c ip e s are a d a p te d fo r lo cal tastes a nd the n e c e s s a ry i n g r e ­ d ien ts are lo cally a v a ila b le . H o m e r e p a ir and o th e r h o w - to p u b li c a ti o n s or p r o g r a m s m u s t c o n s i d e r lo cal n e e d s an d lo cally a v a ila b le p ro d u c t s an d tools. T h o s e te a c h in g p e o p le to bu ild d e c k s and p atio s are u s e le s s w h e r e th e m a jo rity o f a c o u n t r y ’s p o p u la t io n live in a p a r t m e n t s in c ities, as is the c a se in m a n y E u ­ ro p e a n n atio n s. A d v e r ti s e m e n ts m u s t be sc r e e n e d to a v o id o f f e n d in g lo cal m o r e s or in su ltin g r e a d e r s an d v ie w e rs . E v e n the c o m p a n y lo g o s , p r o g r a m set d e s i g n s , an d so o n m u s t be c a re fu lly re e v a l u a te d in the f o r e ig n m a rk e t. C o lo r is c u ltu ra lly s ig n ific a n t a n d can sig n a l d if fe re n t th in g s in d if f e r e n t c o u n tr ie s . F o r e x a m p l e , w h ite is th e c o lo r o f m o u r n ­ ing in the M i d d le E ast. P lace is also an issu e b c c a u s c tra n s p o rta tio n an d c o m m u n i c a t i o n i n f r a s t r u c ­ tures o f m a n y c o u n tr ie s are less d e v e lo p e d than in the U n ite d S tates. T h e target c o u n t r y ’s in f ra s tru c tu re is e x a m i n e d to see h o w easily the p r o d u c t can be d is tr i b ­ u ted o u ts id e o f u rb a n areas. T h e in v e s tin g firm m u s t d e c id e w h e t h e r the c o sts o f w i d e s p r e a d d is trib u tio n are a c c e p ta b le . T h e p ro m o ti o n p r o c e s s also c h a n g e s b e c a u s e p ro m o ti o n a l s l o g a n s a n d ev en th e p u b lic a tio n o r p r o g r a m ’s n a m e m a y n o t tran slate w ell into o th e r la n g u a g e s . C o m m o n U .S . p ro m o ti o n a l stra te g ie s such as e v e n t s p o n s o r s h i p m a y n o t be p o s s ib le o r a c c e p t a b le for in c r e a s in g a u d ie n c e s o v e rs e a s . It is difficult if n ot i m ­ p o s s ib le to c o lle c t ra tin g s an d r e a d e r s h ip d a ta, m a k i n g it h a rd to d o ta rg et m a r ­ k e tin g . H e n c e , the m e d i a m a n a g e r m u s t c a re f u lly re s e a rc h p o s s ib le p r o m o ti o n a l stra te g ie s w h e n d e v e lo p i n g a m a r k e ti n g p lan fo r a n o th e r c o u n tr y .

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H u m a n Resources Issues T h e h u m a n r e s o u rc e s pla n a d d re s s e s h o w to a c q u ir e and d e v e lo p , as w e ll as w h e r e to find, the e m p l o y e e s n e e d e d to m a n a g e th e fo re ig n o p e ra tio n an d p r o ­ d u c e th e m e d i a c o n te n t. E x is tin g m a n a g e r s o r k e y p e r s o n n e l m a y be sent to o v e r ­ see the n e w c r o s s - b o r d e r o p e ra tio n . T h is e th n o c e n tr i c a p p r o a c h e n s u r e s th a t sta ff is f a m il ia r w ith th e c o m p a n y ’s go als. T h e s e m a n a g e r s are u n f a m il ia r w ith and have few or no co nta c ts in the new m arket. It can also be difficult to find A m e ric a n s w h o are q u alifie d to w o rk o v e rs e a s . F e w e r A m e r i c a n s s p e ak a s e c o n d l a n g u a g e an d liv ed o r tra v e le d e x te n s iv e l y in o th e r c o u n tr ie s th a n e m p l o y e e s f o u n d in o th e r r e g io n s o f the w o rld . W it h the p o ly c c n tric m o d e l, e m p l o y e e s arc h ired lo c a lly f o r the n e w fo re ig n office o r e x is tin g m a n a g e m e n t an d p e r s o n n e l are left in p lace . A large m e a s u re o f c o rp o r a te c o n tr o l is forfe ited . T h e f o r e ig n m a n a g e r s an d e m p l o y e e s h a v e local c o n ta c ts , b u t th ey n e e d tr a in in g an d tim e to a s s im ila te c o rp o r a te e x p e c t a tio n s . A m o n g tr a n s n a tio n a l c o m p a n i e s , the g e o c e n t r i c m o d e l is a third a p p r o a c h to p e rs o n n e l m a n a g e m e n t . F o r e x a m p l e , a N e w Z e a la n d e x e c u t iv e m i g h t m a n a g e a U .S. office for a G e r m a n p a r e n t c o m p a n y , o r a J a p a n e s e n a tio n a l m i g h t run a s u b s id ia r y in India for a B ritish c o rp o r a ti o n . C o m p a n i e s m a k e lo n g - te rm c o m ­ m i tm e n ts to th e s e m u lti f a c e t e d , in te rn a tio n a l m a n a g e r s . T h e y are g r o o m e d c a r e ­ fully for top le a d e rs h ip p o s i ti o n s w h e re th e ir in te rn a tio n a l o u tl o o k , e x p e rt is e , and e x p e r i e n c e ca n b e u se d to g u id e th e tr a n s n a ti o n a l o rg a n i z a ti o n . A m b it io u s fu tu re m a n a g e r s m u s t e x p e c t in c r e a s e d c o m p e t it io n fo r top j o b s as c o m p a n i e s loo k w o r l d w i d e for th e m o s t tale n te d , c a p a b l e , and a d a p ta b le in d iv id u a ls.

Staff Choices W h e n an o rg a n i z a ti o n d e te r m i n e s a h u m a n r e s o u rc e s p lan , it c o n s i d e r s the a v a il­ ability o f lo cal ta lent. Illiteracy a n d train in g m a y be a m a j o r c o n c e r n fo r a firm c o n s i d e r in g a p ro p e r ty in a d e v e lo p i n g n a tio n . A firm h a v in g a g lo b a l v is io n is c o n c e r n e d a b o u t h irin g lo cals w h o fo cu s on th e ir o w n unit ra th e r th a n the o r g a n i ­ za tio n a s a w h o le . P ro d u c t io n raises is su es if th e m e d i a p r o d u c t re q u ire s m a n ­ ag e rs w ith b r o a d e r e x p e r i e n c e an d a s o p h i s ti c a te d u n d e r s ta n d in g o f the links in the p ro c e s s . M a n a g e r s w ith less p r o d u c t-s p e c ific k n o w l e d g e arc d e s i re d fo r a p r i­ m arily s t a n d -a lo n e p r o d u c t w ith little i n t e r d e p e n d e n c e a c ro s s units. A n a t i o n ’s p o litical stability is a facto r. E x p a tri a te s are fa v o r e d w h e n the risk o f g o v e r n m e n t in te rv e n tio n o r terro rism ex ists. E x p a tri a te s are less su s c e p tib le to lo cal po litical fo r c e s an d p ro v id e a s s u ra n c e th a t o v e ra ll o rg a n i z a ti o n a l g o a ls are up h eld . F in a lly , s ig n ific a n t c u ltu ral d i f fe re n c e s a ffe ct m a n a g e r ia l se le c tio n . If la n ­ g u a g e , re lig io n , a n d c u s t o m s are d if fe re n t, e x p a tr ia t e s w h o are g o o d in te rp re te rs or tr an sitio n a g e n ts b e tw e e n the h o m e a n d h o s t c o u n tr y m a k e g o o d c h o ic e s . C u l ­ tu ral b a rrie rs are lo w e s t for U .S. c o m p a n i e s in E u ro p e , C a n a d a , A u s tr a lia , and

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N e w Z e a la n d , w ith m i d r a n g e b arrie rs in L atin A m e r i c a and g re a t e s t b a rriers in A sia , th e M i d d le E ast, an d A frica. Y e t U .S . e x p a tr ia te s c a n fail to c o m p l e te a s s ig n m e n t s . It is e s t im a te d th at 20 % to 4 0 % retu rn p r e m a t u r e l y — a failu re rate th r e e to f o u r tim e s tha t o f E u r o p e a n an d A s ia n c o m p a n i e s . F a ilu re s are c o stly b e c a u s e “p r e m a tu r e r e t u rn e e s co st $ 9 8 , 0 0 0 to $ 2 9 4 , 0 0 0 each in 2 0 0 0 d o lla rs, w h ic h tr a n s la te s into $3.8 billion p e r y e a r in d ir e c t c o sts to U .S. firm s” ( G o m e z - M e j i a , B a lk in , & C a rd y , 2 0 0 1, p. 5 6 1 ). O th e r in ta n g ib le s such as b u s i n e s s d is ru p tio n s , p a u s e s in le a d e rsh ip , and m i s s e d b u s i n e s s o p p o r t u n it ie s arc c o n n c c t c d to failures.

Financial Planning Abroad M o s t fin a n c ial p la n n i n g is d o n e d u rin g the initial stra teg ic p la n n in g p r o c e s s fo r o v e rs e a s m a r k e t en try . D e ta ils o f h o w the n e w v e n tu r e is c a p ita liz e d d u ri n g its first few y e a rs are w o r k e d o u t as the v e n tu r e is set up a nd o w n e r s h i p stru c tu re is e sta b lish e d . T h e initial fin ancial p lan m a y be re c o n s id e r e d if u n e x p e c t e d d if fic u l­ ties arc e n c o u n te r e d . O v e r s e a s o p e r a t io n s arc g e n e ra l ly e x p e n s i v e to run d u e to h ig h e r travel an d c o m m u n i c a t i o n co sts. N e w start-u p v e n tu r e s often tak e sev eral y e a rs to b e c o m e p ro fita b le u n d e r the best o f c i r c u m s t a n c e s ; w h e n in v e s tin g o v e r ­ seas, it can ta ke e v e n lo ng er. S e v e ral facto rs c o u ld alter in te rm e d ia te financial p ro je c tio n s an d req u ire e m e r ­ g e n c y f u n d in g fo r the n ew v e n tu re. E c o n o m i c d o w n tu r n s are h a r d e r to anticip ate a n d can th ro w o f f initial financial p la n s if they o ccu r. H irin g a local s ta ff m a y c r e ­ ate g re a te r than e x p e c t e d train in g c o sts b e c a u s e the s ta ff m u s t learn n ew w a y s o f w o rk in g , ev e n if the p a re n t c o m p a n y b u y s an ex is tin g m e d i a c o m p a n y . N ew e q u ip m e n t c o sts an d legal e x p e n s e s m a y s o a r as the p a re n t c o m p a n y n e g o tia te s in an u n fa m il ia r legal an d re g u la to ry e n v ir o n m e n t . F o re ig n - p r o d u c e d m e d i a co n te n t m a y not be ac c e p te d lo cally d u e to c u ltu ral d if fe re n c e s an d w ill n ee d ad ju s tm e n t.

Assessment F in a lly , m a n a g e r s m u s t e sta b lish a c o m p a n y b e n c h m a r k d u ri n g in te rm e d ia te p la n n i n g to m e a s u re the n e w v e n t u r e ’s fin ancial su c c e s s. F o r s o m e firms, a n ew v e n tu r e is a s u c c e s s if it g e n e r a t e s e n o u g h r e v e n u e to c o v e r its e x p e n s e s d u rin g the in t e rm e d ia t e p la n n i n g p e rio d . F o r o t h e r firms, a v e n tu r e is p ro fita ble w h e n it also c o v e r s the p a re n t c o m p a n y ’s a d d itio n a l o v e r h e a d , such as tr av el, c o m m u n i ­ c a tio n , tr a in in g , a n d m a n a g e m e n t o v e rs ig h t. O th e rs c o n s i d e r a n e w v e n tu r e p r o f ­ itable on ly if the p a re n t c o m p a n y ’s initial i n v e s tm e n t an d s ta rt-u p e x p e n s e s are r ep aid an d its o p e ra t in g co sts and m a n a g e m e n t o v e r h e a d are c o v e re d . P r o b a b l y the m o s t difficu lt situ atio n is w h e n the new v e n tu r e d o e s n o t m e e t the p a re n t c o m p a n y ’s fin an cial b e n c h m a r k s d u ri n g the in te r m e d ia t e p la n n in g p ro c e s s. T h e m a n a g e r th e n d e c id e s w h e t h e r the lo n g - te rm p o te n tia l benefits

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ju stify m a in tain in g an unprofitable o v e rse as m ed ia operation. T he m a n a g e r must rethink how the ov erse as in v e s tm en t is structured, how it is m an ag e d , and the p ro d u cts it pro du ces. S o m e tim e s a struggling m edia venture is rescu ed by c h a n g ­ ing partners, m an ag e rs, the p ro d u c t mix, or by cha n g in g a nd relau nc hin g an e s ­ tablished product. S o m e tim e s the only viable decision is to a b a n d o n a m arket and focus c o m p a n y efforts on oth er p ro d u cts or countries.

Technology Impacts C o n v e rg in g m ed ia tech no log ies ero ded the d istinctions b etw een the telephone, c o m p u ter, T V , radio, n ew sp ap er, m ag a z in e , and bo ok industries. C o n v e rg e n c e and in creased co m p etitio n , co m b in e d with red u ced rev en u e s and profits, p re s­ sured m ed ia c o m p a n ie s to exp and in ternationally (T u ro w , 1992), often by d e v e l­ o pin g profitable synergies or distributing the sam e con ten t o r c o n cep ts th rou gh d ifferent m ed ia products. A story idea w as c ro s s-m a rk e te d by a m u ltim e d ia c o n ­ g lo m erate th ro ug h its b oo k p ub lishing and film studios w hile the m ov ie s o u n d ­ track w as sold throug h its rcco rd c o m p a n y . T h e s e sy nergies also w e re realized by acquisition o f and in v e s tm en t in oth er lines o f busin ess often to gain e x p e ri­ e n ce overseas. M e d ia tech n o lo g y m a n u factu rers also w anted to gain con tro l o f po p u lar films or m usic to en su re such e n te rta in m e n t features w ere distributed in fo rm ats c o m p atib le with their te c h n o lo g ie s (C a rv eth , 1992; G ersh o n , 1997; T u ro w , 1992). By 2002, signs o f d is e n c h a n tm e n t with new and co n v e rg in g m ed ia em erg ed. T h e forced dep artu re o f T h o m a s M id d e lh o ff as h ead o f G e r m a n y ’s B ertelsm an n in July 20 02 sent a chilling signal to international online m ed ia d evelo pers. A O L T IM E W A R N E R IN C. and V iven di U niversal SA jo in e d M id delho ff, an in tern a­ tional te c hn olog y vis ionary w h o invested in W e b -m u s ic upstart N apster, in heavy inv estm ents in m ed ia tech no log y. All w ere sharply w ith d ra w in g to their core traditional m ed ia bu sin esse s by 2002. O v e r the next dec ad e, an interesting set o f m o d e ls should e m e rg e as te ch n o lo g y b e c o m e s less o f an e x p e rim en tal toy and m ore o f an integral strategic p lann in g tool for c o m p a n ie s that w an t an inter­ national p resen ce and solid profits.

SUMMARY P lanning is the essence o f g o o d m a n a g e m e n t. It is m u ch like decision m ak in g in that its su ccess d e p e n d s on the ad eq u a te collection and an alysis o f inform ation. T h e plann ing pro cess should involve peop le from all org an iza tion al levels. P la n ­ ning ta kes three basic forms: strategic, interm ed iate, and short run. Strategic is lo ng -ran ge p la nn ing , usually in vo lvin g 3 to 5 years. In term ediate plan n in g often involves 6 m o nth s to 2 years. Sho rt-run plan ning involves a w eek to a year.

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In v e s tin g o v e r s e a s often e n ta ils m o r e risk tha n e x p a n d i n g a m e d i a c o m p a n y ’s b u s in e s s in its o w n h o m e m a rk e t. Y e t in t o d a y ’s g lo b a l e c o n o m y , o v e r s e a s in ­ v e s t m e n t s are b e c o m i n g m o r e c o m m o n an d im p o r t a n t to the lo n g - te rm w e l l ­ b e in g o f m e d i a c o rp o r a ti o n s . In te rn a tio n a l o p e ra t io n s p r o v i d e a c c e s s to la rg er a u d ie n c e s an d m o r e a d v e rtis e rs , an d th e y tap n e w te c h n o l o g ie s , n e w id eas , and n ew artists or p r o d u c e r s from c o u n tr ie s b e y o n d a f i r m ’s h o m e m a rk e t. H a v in g su b s id ia r ie s in o th e r c o u n tr ie s b a la n c e s a c o m p a n y ’s fin an ces as a d o w n tu r n in o n e c o u n t r y ’s e c o n o m y m a y be p artially o ff s e t by an u p s u r g e o r stab ility in the e c o n o m y o f an o th e r. F in a lly , the m u l ti n a ti o n a l m e d i a c o rp o r a ti o n o ften h as r e ­ so u r c e s a n d e c o n o m i e s o f scale th a t can g iv e it a d v a n ta g e s in h e a d - t o - h e a d c o m ­ p e titio n a g a in s t o th e r strictly d o m e s ti c m e d i a o p e ra tio n s. T h u s , th e p a c e o f m e d i a g lo b a liz a tio n is in c r e a s in g ly rapid. F u tu r e m e d i a m a n a g e r s m u s t h a v e fo re ig n l a n g u a g e skills, m u ltic u ltu ra l k n o w le d g e , an d a g lo b a l o u tlo o k . M e d i a e x e c u t iv e s o f the 2 1 st c e n tu r y m u s t u n d e rs ta n d the c o m ­ plex is su es th at arise w h e n m a n a g i n g m e d i a v e n tu r e s in d if fe re n t c o u n tr ie s , h a v e the skills to a n tic ip a te th o se c h a ll e n g e s , and p o s s e s s the k n o w l e d g e a n d ability to p lan stra te g ic a lly fo r s u c c e s s in th e g lo b a l m e d i a e c o n o m y .

ACKNOWLEDGMENTS T h e a u th o r w is h e s to th a n k the S a m H o u s to n S tate U n iv e rs ity J o u r n a lis m P r o ­ g ra m an d Y v e tte K e e n e r, s tu d e n t a ss ista n t, fo r th eir s u p p o r t a n d a ss is ta n c e d u r ­ ing the w ritin g o f this ch a p te r.

Case 7.1 Connectin g O n lin e and T rad itio nal M e d ia : N ot Always an Easy Planning Task

S h e ila w a s p r o m o te d 3 m o n t h s ag o to vice p r e s id e n t o f in te ra c tiv e m e d i a at a m e d i u m - s iz e n e w s p a p e r in the w est. H e r n e w re s p o n s ib ilitie s in c lu d e c o o r d i n a t ­ ing s trateg ic p la n n i n g fo r the e n tire o rg a n i z a ti o n . N e x t m o n t h she is s c h e d u l e d to p r e s e n t a 3- to 5 - y e a r strateg ic pla n for in te g ra tin g o n lin e cla ssified a d v e r t is ­ ing w ith tr a d itio n a l n e w s p a p e r classifie d a d v e rtis in g to the n e w s p a p e r ’s e x e c u ­ tive b o a rd . S h e il a w a s p r o m o te d p rim a rily b e c a u s e she u se d te c h n o l o g y to o p e n n ew m a r k e ts fo r h e r c o m p a n y . T e n y e a rs ag o, she started at the n e w s p a p e r in parttim e classifie d a d v e rtis in g sale s ta k in g o rd e r s o v e r the p h o n e . W it h in a y e ar, she c o n v in c e d the a d v e rtis in g d ir e c to r to e x p e r i m e n t w ith o n lin e ad s, an d a fte r a few y e a rs built up a sm all d e p a r t m e n t . In 1997, sh e w a s n a m e d d ir e c to r o f new

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m e d ia . H e r p r i m a r y g o a l th en w a s to h a v e the la r g e s t p o ss ib le d a ta b a s e o f c la s s i­ fied ad listings. S h e started h e r c a m p a ig n w ith c ar d e a le rs a nd real e sta te firms. “ W e k n e w the v a st m a j o ri ty o f c a r d e a le rs an d rea l estate c o m p a n i e s o n ly ran a p o rtio n o f th e ir listin g s in the p rin te d n e w s p a p e r . W e b e g a n to o ff e r p a c k a g e s to ru n a ll th e ir listing s o n li n e ,” she said. N ex t, S h e ila c re a t e d a W e b site for e a c h a d v e rtis e r a n d then m e r g e d th e ir list­ ing s into the n e w s p a p e r ’s s e a r c h p r o g r a m . A t first sh e d id all the w o rk herse lf, b u t then a d d e d a p r o g r a m m e r , tw o p ro d u c t io n p e o p le , an d o n e s a le sp e rs o n . T o d a y she h a s 18 \ f u ll-tim e e m p l o y e e s , in c lu d in g f o u r s a l e s p e o p le , th re e sales s u p p o r t s t a f f to h e lp w ith ad c re a tio n , an d tw o p r o g r a m m e r s . T h e re s t are p r o ­ d u c e rs w h o f u n c t io n as n e w s jo u r n a li s ts . T h e y m a n a g e tw o W e b sites. O n e is a re g io n a l po rtal w ith p a rtn e r s h i p s th at s e r v e s as a r e p o s ito r y fo r all the n e w s p a ­ p e r ’s cla ssified ads. T h e o th e r site is d e v o te d to a n e w s p r o d u c t th a t c o n ta i n s m o s t o f the d aily n e w s p a p e r ’s c o n te n t s p lu s f o u r o r five lo cal stories u p d a te d th r o u g h o u t the d ay. T h e o n lin e n e w s p r o d u c t has i n c r e a s e d o v e ra ll r e a d e r s h ip as w ell as th e n u m b e r o f tim e s the s a m e p e o p le visit the c o m p a n y ’s server.

M a rk e tin g Potential T h e g o a l fo r th e classified a d v e rtis in g W e b site is to h a v e the la rg e st n u m b e r o f listin gs p o ss ib le . “ If p e o p le w a n t to see a full in v e n to ry o f lo cal j o b s , cars or h o u s e s av a ila b le in th e re g io n , w e w a n t th e m to th in k o f us an d o u r W e b site as the p la c e to c o m e , ” S h e ila says. R e c e n tl y sh e f o c u s e d h e r atte n tio n on in c r e a s in g o n lin e j o b a d v e r t is e m e n ts . H irin g is d o w n b e c a u s e o f e c o n o m i c facto rs. H o w ­ ev er, S h e ila k n o w s lo c al e m p l o y e r s still h a v e jo b s to a d v e rtis e b e c a u s e she a s ­ sig n e d m o s t o f h e r s ta ff to in te rv ie w local b u s in e s s e s . F r o m the s ta ff r e s e a rc h , sh e le a r n e d th ere w e re b u s i n e s s e s w a n tin g to a d v e r ­ tise j o b s , b u t n ot the tr a d itio n a l w a y . In the past, b u s i n e s s e s w ith j o b s to fill h ired a re c r u itin g firm to p lace ad s in th e n e w s p a p e r f o r a fee, so rt th r o u g h a p p lic a n ts , an d s c h e d u l e in t e r v i e w s w ith the m o s t q u a lified a p p lic a n ts . T h e re c r u itin g firm also r e c e i v e d a c o m m i s s i o n fro m the n e w s p a p e r for e v e ry ad it p la c e d . T h e r e l a ­ tio n s h ip b e tw e e n the n e w s p a p e r a n d r e c r u itin g firms w a s c lo s e r th an the o n e b e ­ tw e e n the n e w s p a p e r an d b u s i n e s s e s . S h e il a le a r n e d the n e w s p a p e r a d v e rtis in g s ta ff did n o t c o n ta c t b u s i n e s s e s d ire c tly , b u t relied totally on re c ru itin g firm s to b rin g classified j o b ad s to the p a p e r. S e v e ra l lo cal re c r u itin g firm s fo ld e d in the p a st ye ar, an d the n e w s p a p e r ’s cla ssifie d j o b listing s d r o p p e d 10%. D u r in g this s a m e p e rio d , the o n lin e j o b listing se rv ic e , M o n s te r . c o m , d rew o v e r 14% o f local ad u lts to its W e b site. T h e n e w s p a p e r ’s a d v e rtis in g m a n a g e r said r e c r u itin g firm s c la i m e d o n lin e se rv ic e s like M o n s te r . c o m w e re u n p o p u l a r w ith local b u s i n e s s e s b e c a u s e th ey d ra w too m a n y r e s u m e s a n d u n q u a lifie d a p p lic a n ts . S h e ila w o u ld not sta k e h e r c o m p a n y ’s c o m p e t it iv e a d v a n ta g e on p ro v i d in g f e w e r r e s u m e s an d a p p li c a n ts th a n o n lin e s erv ices. W h il e a c k n o w l e d g i n g th at

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o n lin e s e r v ic e s can d ra w r e s u m e s fro m p e o p le w h o are c le a rly n o t q ualifie d, she k n e w e le c tro n ic f o r m a ts allo w e a sy a n d a lm o s t in s ta n t a n e o u s so rtin g . S he c o u ld o ffe r j o b listin gs at a b o u t a te n th o f the c o st o f re c ru itin g firms. S h e sees M o n s te r . c o m and s i m i la r se rv ic e s as s tro n g c o m p e t it o r s fo r lo cal j o b listings. S h e h a d 10 sta ff m e m b e r s m a k e p e rs o n a l c o n ta c t w ith lo cal e m p l o y e r s to find o u t h o w th ey re cruit u sin g th e In tern e t. S h e f o u n d th a t b u s i n e s s e s d o n o t care h o w m a n y r e s u m e s o r u n q u a lifie d a p p li c a n ts th ey r e c e iv e b e c a u s e th e ir h u m a n r e s o u rc e s so f tw a re filters a n d th en m a t c h e s q u alified p e o p le w ith j o b o p e n in g s . T h e y e v e n a r c h iv e a p p li c a n ts w h o arc p e rf e c t fo r j o b s o p e n in g so o n . T h e y d o not w a n t the n e w s p a p e r o r a r e c r u itin g firm to sc re e n fo r th em .

C om pe titive Advantages S h e ila th in k s h e r o n li n e s e r v ic e o ff e rs lo cal e m p l o y e r s at lea st three u n iq u e a d ­ v a n ta g e s. T h e first is the c o m b i n e d d is trib u tio n c h a n n e l s o f the n e w s p a p e r and W e b site. H a lf o f the 2 0 0 , 0 0 0 p e o p le w h o visit h e r W e b site n e v e r c h e c k the n e w s p a p e r for e m p l o y m e n t ads. O th e r p e o p le o n ly re ad the n e w s p a p e r a n d n e v e r d o an In te rn e t j o b se a rc h . U n lik e o n lin e so u r c e s , sh e o ffers h ig h v is ib ility in tw o m ed ia. S e c o n d , sh e o ffers lo cal c u s t o m e r s e r v ic e — s o m e th i n g the n e w s p a p e r had tu rn e d o v e r to re c r u itin g firms. She a d m i ts it is old f a s h io n e d , b ut s u c h p e rs o n a l atte n tio n w o r k e d w e ll in th e a u t o m o ti v e an d real e sta te classified m a r k e ts . It is a s e r v ic e tha t n a tio n a l o n lin e p ro v i d e rs c a n n o t d u p lic a te . If th ere is a p r o b l e m , the local b u s i n e s s p e r s o n “ can m a r c h rig h t d o w n h e re and talk to m e a b o u t it.” T h ir d , a lo cal o n lin e s e r v ic e d e liv e rs b e tt e r q u a lity a p p lic a n ts . S h e is testin g to co n firm this. E a rly fin din gs s h o w a p p lic a n ts w h o use a n e w s p a p e r W e b site h a v e h ig h e r d e m o g r a p h i c s th a n r a n d o m r e s p o n d e r s fr o m a la r g e r area.

Financial Concerns W h e r e a s the n e w s p a p e r u se s a rigid rate card , S h e ila p rin te d an o n lin e rate card o n c e in 1995 th at c o s t $ 5 ,0 0 0 fo r a n ice d e sig n a n d fo ld er, b u t it w a s o u td a t e d in a m o n th so she n e v e r p rin te d a n o th e r . In g e n e ra l, S h e ila d o e s b e tte r b y tailo rin g an d c u s t o m i z in g to the a d v e rtise r, e s p e c i a ll y fo r b a n n e r a d s an d s p o n s o rs h i p s . J o b p o s tin g rate s an d p a c k a g e s are p u b li s h e d o n lin e an d the o n lin e rate s are n o m i n a l ( c o m p a r e d w ith th e n e w s p a p e r ) . A n in te re stin g In te rn e t d y n a m i c is th e re are no m a r g in a l c o sts w h e n a d d in g o n e ad or jo b p o s t in g o n lin e v ers u s a d d in g 2 0 o r 100. “ T h e r e ’s no d if fe re n c e to u s ,” S h e ila says. S h e i l a ’s o n li n e o p e ra tio n is s im ila r to T V and ra d io statio n s th at p ro v i d e clien ts w ith a list o f th in g s th ey can d o o r the o v e ra ll v a lu e o f an ad. S e llin g o n ­ line b a n n e r a d v e rtis in g s p a c e is like b u y in g tim e o n rad io statio ns. If yo u call

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a m o n t h in a d v a n c e , w h e n m u c h ra d io ti m e is a v a ila b le , it c o sts o n e p rice, b u t if y ou call at th e last m in u te , the price g o e s u p b e c a u s e th ere is little tim e left. S h e ila track s h o w m u c h b a n n e r s p ace is a v a ila b le on b o th W e b sites (the classified ad site a n d n e w s site) an d p rices a c c o r d i n g to a v a ila b ility w h e n c u s ­ t o m e rs inq uire. In ad dition to jo b . car, and real estate ads, S h e i l a ’s o nlin e site caters to sm all in­ d e p e n d e n t c o m p a n i e s like N o s e y N e ig h b o r, w hich o ffers public reco rd s se arc hes ( fo r c r i m i n a l c h e c k s , fin an cial b a c k g r o u n d s , e m p l o y m e n t h is to ries, etc.). S h e i l a ’s o n lin e c las sifie d ad site also attra cts s m a ll e r a d v e rtis e rs w h o find the tra d itio n a l n e w s p a p e r too e x p e n s i v e . S h e ila is c e rta in o n lin e c las sifie d a d v e rtis in g ca n be a m a j o r c o n tr ib u t o r to the c o m p a n y ’s profits. First, she m u s t d e v e lo p a flexible plan that can h a n d le the d y n a m i c s o f an o n lin e m e d i u m w ith o u t lo s in g the t r a d i­ tio nal r e v e n u e g e n e ra t e d by n e w s p a p e r classified a d v e rtisin g .

H u m a n Resources Issues S h e ila is e x c ite d a b o u t the p r o s p e c ts o f o n li n e a d v e rt is i n g , b ut c o n c e r n e d a b o u t the co n flic t b e tw e e n h e r o n lin e s a l e s p e o p le an d the n e w s p a p e r sa le s p e o p le . U n til re c e n tly , the o n lin e an d n e w s p a p e r s a l e s p e o p le w e re n o t e v e n in the s a m e b u il d ­ ing. A b o u t 8 m o n t h s a g o , S h e ila m o v e d tw o o n li n e s a l e s p e o p le in to the s a m e b u ild in g as the n e w s p a p e r ’s a d v e rtis in g staff. T h e r e w e re m ix e d resu lts from the forced in te ra c tio n . T h e n e w s p a p e r sa les s t a ff said the o n lin e a d v e rtis in g p e o ­ ple are c a n n ib a liz i n g th e ir re v e n u e . “T h a t ’s in spite o f the fact th a t w e ’re ju s t o n e d ro p in th e b u c k e t ,” said S h e ila , p o in tin g o u t th a t if th e n e w s p a p e r W e b site w a s n o t c a p tu r in g the o n lin e a d v e rtis in g r e v e n u e , a c o m p e t i t o r w o u ld be ste alin g the b u s i n e s s fr o m the c o m p a n y . In c e n t iv e s are also an is su e b e c a u s e th ey are h i g h e r fo r n e w s p a p e r s a l e s p e o ­ ple than o n lin e sa le s p e o p le . It is h a rd fo r S h e il a to d e v e lo p a c o m p e t it iv e i n c e n ­ tive p a c k a g e fo r h e r sales s t a ff b c c a u s c th e r e v e n u e o v e ra ll is s m a ll e r (th an for the n e w s p a p e r ) . S h e w a n ts to k e e p a d e c e n t o n lin e profit m a r g in . In a d d itio n , there arc s e rio u s j o b skill d if fe re n c e s b e tw e e n S h e i l a ’s s t a f f an d the n e w s p a p e r ’s staff. S o m e n e w s p a p e r s a l e s p e o p le are u n f a m il ia r w ith o n lin e ad s a n d d o n o t ev e n use the In ternet. B e c a u s e th ey d o n o t use it, th ey are s k e p t i ­ cal a b o u t h o w m a n y c u s t o m e r s use, a lth o u g h h e r W e b site g e ts sig n ifica n tly m o r e traffic than re a d e r s h ip figures s h o w fo r the e n tire n e w s p a p e r . S h e i l a s a id . W e h a v e t r o u b l e c o n v e r s i n g . E v e n in t h e s i m p l e s t w a y s — i t ’s so e a s y to h a v e m i s u n d e r s t a n d i n g s in t e r m s o f t e r m i n o l o g y a n d t h i n g s . I h a v e a c t i v e l y e n ­ c o u r a g e d o u r prin t c o u n t e r p a r t s to h i r e p e o p l e w i t h I n t e r n e t e x p e r i e n c e . W e w ill n o t m a k e p r o g r e s s i f the t e c h n o l o g y - s a v v y p e o p l e are in s o m e s m a ll d e p a r t m e n t o f f to th e sid e a n d d o n ’t h a v e an y c h a n c e at c a r e e r a d v a n c e m e n t . T h e y ’ll le a v e a n d go s o m e p l a c e o t h e r th an n e w s p a p e r s . I th in k it’s r eally i m p o r t a n t fo r us to tak e th e skills t h e y h a v e an d i n t e g r a t e t h e m a n d t h e t e c h n o l o g y into the h e a r t o f th e n e w s p a p e r .

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T h e r e w ill c o m e a t i m e w h e n th e vice p r e s i d e n t o f a d v e r t i s i n g w ill b e s o m e b o d y w h o st a rt e d o f f in th e In t e rn e t .

S taffin g is a m a j o r c o n c e rn . H o w do w e train p e o p le ? H o w do w e p lan fo r f u ­ tu re h ir in g a n d in te g ra tio n o f the tw o staffs (o n lin e an d p rin te d n e w s p a p e r ) ? T h e s e are q u e s t io n s S h e ila m u s t a n s w e r in h e r strateg ic plan. S h e il a w a s an E n g ­ lish m a j o r w h o t a u g h t h e r s e lf to use the Internet. E a rly m e d i a t e c h n o l o g y sta ff w e re g e n e ra lis ts an d c o m p a n y e n tr e p re n e u rs . T h e y w o u ld sell ads, m a k e c a l l ­ b a c k s , w o rk on the W e b site— do it all. H o w e v e r , to a c h ie v e re al e x c e l le n c e , w e n e e d p e o p le w h o sp e c ia liz e , S h e ila says.

C onnectin g Mission to Action S h e i l a ’s b ig g e s t c h a ll e n g e is figuring o u t h o w to in te g ra te the o n lin e b u s i n e s s into the e s ta b lis h e d fu n c tio n a l o r g a n i z a ti o n a l s ettin g w h e r e s e p a r a ti o n s a m o n g the n e w s r o o m , a d v e rtis in g d e p a r t m e n t , c ir c u la tio n d e p a r t m e n t , an d p ro d u c t io n exist. O n lin e p ro d u c t s are m u c h m o r e c r o s s -fu n c tio n a l. T h e y m u s t be flexible and ab le to c h a n g e ra p id ly , S h e il a says. F ittin g the o n li n e b u s i n e s s into the t r a d i­ tio n al t o p - d o w n o rg a n i z a ti o n a l s tru c tu r e o f a n e w s p a p e r is difficult. S h e ila k n o w s h e r strateg ic p la n m u s t be tied to the c o m p a n y ’s m i s s i o n s t a te ­ m en t: “ It is th e m i s s i o n o f this n e w s p a p e r to p ro v i d e a tim e ly , c o n v e n ie n t, e th ic a l an d a c c u ra te p r o d u c t o f e x c e l le n c e an d p u b lic s e r v ic e d e s i g n e d to in f o rm , e n t e r ­ tain, an d e n li g h te n r e a d e r s livin g in o u r c o m m u n i t y and re g i o n .”

A S S IG N M E N T U sin g the in f o rm a t io n in the c h a p te r an d the ca se, w rite S h e i l a ’s 3- to 5 - y e a r strateg ic p la n for in te g ra tin g o n li n e an d n e w s p a p e r classified a d v e rtis in g . S h e will p r e s e n t it to the c o m p a n y ’s e x e c u t iv e c o m m i t t e e in 1 m o n th . 1. B e sure to c la rify h o w the m is s io n s t a te m e n t g u id e s the strateg ic plan. T h e strateg ic plan s h o u ld in c lu d e an a n a ly s is of: the b u s i n e s s e n v i r o n m e n t , p ast b u s i n e s s p e r f o r m a n c e , a v a ila b le re s o u rc e s , id e n tific atio n o f g o a ls , p r e ­ ferred as w ell as a lte rn a tiv e w a y s to m e e t the g o als , i m p le m e n ta t io n p lan s , and e v a lu a tio n / a s s e s s m e n t tools. 2. P re p a re an in t e rm e d ia t e p lan in c l u d in g m a r k e ti n g , finan cial, a n d h u m a n r e ­ s o u r c e s c o m p o n e n t s d e s i g n e d to s u p p o r t the strateg ic plan. 3. D e s ig n a s h o r t-r u n p lan th a t o u tlin e s the ste p s to take an d h o w r e s o u rc e s are a llo c a te d d u ri n g th e first few w e e k s o f the p l a n ’s initiation.

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n a l y s is

A m a r k e t is w h e r e c u s t o m e r s b u y g o o d s , an d s e r v ic e s are su p p lie d an d sold by b u s in e s s e s . A m a r k e t an a ly s is d efin es the o p p o rt u n it ie s a b u s i n e s s h a s in a p a r t ic ­ u la r m a r k e t or w ith a p a rtic u la r p r o d u c t an d th e sh o rt- an d lo n g - te rm th re a ts it m a y face. It is a c ritica l c o m p o n e n t o f strate g ic m e d i a m a n a g e m e n t and is i n e x ­ tric a b ly in t e r w o v e n w ith p la n n i n g an d m a r k e ti n g re s e a rc h . T h e r e arc tw o w a y s to v ie w the m a r k e t a n a ly s is p ro c e s s: (a) as a fo r m a l p r o ­ j e c t a m e d i a m a n a g e r u n d e r t a k e s b e fo r e th e c o m p a n y m a k e s a m a j o r n e w i n v e s t ­ m e n t, la u n c h e s a n e w p ro d u c t, o r c h a n g e s its o ve rall b u s i n e s s stra te g y ; an d (b) as p a rt o f the da ily r o u tin e o f m e d i a m a n a g e r s at all o rg a n i z a ti o n a l levels. M a n a g e r s at all o r g a n i z a ti o n a l le v e ls m u s t c o n s t a n tl y sc an the c o m p e t it iv e e n v i r o n m e n t for c h a n g e s in the s tru c tu r e o f th e ir m a r k e ts , the d e m a n d fo r th e ir p ro d u c t s , an d the n a tu r e o f the c o m p e t it io n th ey face. E a c h m a n a g e r m u s t id en tify o p p o rt u n it ie s to e x p lo i t or n e w , e m e r g in g c o m p e t it iv e th re ats. M e d i a m a n a g e r s w h o do n o t a c ­ tiv ely an d c o n ti n u a ll y a n a ly z e th e ir m a r k e t are a lm o s t g u a r a n t e e d to fa ce c o m ­ p etitiv e p ro b l e m s th e y n e v e r saw c o m in g . M a r k e t a n a ly s is is a u se f u l skill fo r s e l f - e m p lo y e d m e d i a p r o f e s s i o n a ls such as f r e e la n c e w rite rs and i n d e p e n d e n t p r o d u c e r s . W h e n e x e c u t iv e s listen to i n d e ­ p e n d e n ts p itch an ide a fo r a b o o k o r T V s eries, th e y w a n t to h e a r specific d e tails a b o u t h o w it w ill earn r e v e n u e f o r the firm (e.g., th e y w a n t the c o n c e p t p itc h e d as a m a r k e t a n a ly s is). W h a t is the ta r g e t a u d ie n c e an d h o w large an d v a lu a b l e is it to a d v e rtis e rs o r fin an ciers? W h a t s i m i la r c o n c e p t s a lr e a d y ex is t to c o m p e t e w ith the p ro p o s e d p ro je c t? H o w w ill it fit w ith the m ix o f film s, b o o k s , o r series that the c o m p a n y a lr e a d y p r o d u c e s ? W h a t w ill it c o s t to p r o d u c e ? W h a t is the p r o d u c t io n / d is t r i b u tio n c o m p a n y ’s return on i n v e s tm e n t lik ely to be? E v e n m e d i a p ro f e s s i o n a ls such as re p o r te rs be nefit fro m u n d e r s ta n d in g the m a r k e t a n a ly s is p ro c e s s. A r e p o r te r w h o w a n ts to la u n c h a m a j o r in v e s tig a tiv e p ro j e c t o r visit C h in a to w rite a b o u t a sp e c ia l m u s e u m e x h ib i t o f C h in e s e art is w ise to p ro p o s e the p ro je c t to the e d it o r in m a r k e t an a ly s is te r m s . W h a t w ill the p ro j e c t c o st in tim e an d m o n e y ? H o w w ill it p o s itio n the n e w s p a p e r o r T V s t a ­ tion in re la tio n s h ip to its d ir e c t c o m p e t it o r s ? W h a t w ill the retu rn o n in v e s tm e n t be in te r m s o f c ir c u la tio n o r ratin g s, p r o m o ti o n a l o p p o rt u n it ie s , jo u r n a lis tic a w a rd s , o r r e p u t a ti o n in the m a r k e t? T h e r e p o r te r w h o g a th e r e d the d a ta an d a n a ­ ly zed s u c h is su es b e fo r e p itc h in g the id e a has a m u c h b e tte r c h a n c e o f g a in in g 186

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p ro j e c t a p p r o v a l th an o n e w h o w a lk s into the e d i t o r ’s o ffice an d say s, “ H e y , B oss! I h ad a g re a t idea this m o r n i n g ! ” So h o w is a m a r k e t an a ly s is c o n d u c te d ? A m a r k e t is ty pically defined by g e o g ­ ra p h y an d pro d u ct. G e o g r a p h y is the p h y s ic a l lo catio n w h e re the p r o d u c t is sold, so a n e w s p a p e r ’s g e o g ra p h ic m a r k e t is the area w h e re the p a p e r is d is trib u te d th r o u g h h o m e d e liv e ry o r n e w s s ta n d sales. A radio s t a ti o n ’s g e o g ra p h i c m a r k e t is the area re a c h e d by its b ro a d c a s t signal. W h e r e a s b r o a d c a s t an d p rin t o utle ts h av e ca refu lly defined lo cal g e o g ra p h ic m a r k e ts, o th e r ty p e s o f m e d ia c o m p a n i e s , such as film, T V , o n lin e , b o o k , and m a g a z in e p ro d u c e r s , see the entire w o rld as their g e o g ra p h ic m a r k e t, sele ctin g an d d e v e lo p i n g c o n te n t acc o rd in g ly . P r o d u c t refers to the ty p e o f p r o d u c t a c o m p a n y sells. A m a r k e t a n a ly s is f o r a p r o d u c t in c lu d e s d e m a n d for th a t p r o d u c t an d the n u m b e r o f c o m p e t it o r s selling th a t p r o d u c t o r s u b s titu te s fo r it in the firm ’s g e o g r a p h i c m a r k e t. F o r m e d i a c o m ­ p a n ie s , a n a ly z in g the p r o d u c t a s p e c t o f th e ir m a r k e ts is m o r e c o m p l ic a t e d than for m o s t in d u s trie s b e c a u s e m e d i a p r o d u c t s are jo i n t c o m m o d it ie s . S a id a n o th e r w a y , m e d i a c o m p a n i e s w o rk in a d u a l- p r o d u c t m a r k e t o r sell the s a m e p r o d u c t in to tw o d if fe re n t m a r k e ts at the s a m e tim e. T h e y sell c o n te n t to a u d ie n c e s an d sell th o s e a u d ie n c e s to a d v e rtise rs. T h e a d v e rt is e rs b u y ad v e rtisin g m e s s a g e s spe cific ally targ e ted to th e ty p e s o f a u d ie n c e s the c o n te n t attracts. F o r m e d i a c o m p a n i e s , an a n a ly s is o f th e ir p r o d u c t m a r k e t in c l u d e s m o r e th an j u s t a lo ok at the d e m a n d an d c o m p e t it io n fo r the c o n te n t th ey p r o d u c e . It m u s t also e x ­ a m i n e the a d v e rtis in g m a r k e t, a u d ie n c e s in th e ir g e o g r a p h i c m a r k e t, an d h o w d e ­ sirab le th o s e a u d ie n c e s are to p o te n tia l a d v e rtise rs. R e c e n tly m ed ia e c o n o m i s t s id entified a third e le m e n t b e sid e s p r o d u c t and g e ­ o g ra p h y to d efine m e d ia m ark ets: the in v e s tm e n t m a r k e t fo r m e d ia c o m p a n i e s (A lb a r ra n , 1996). T h is third e le m e n t is g ro w in g in im p o rta n c e as m e d ia m a n ­ ag ers c o m p e t e w ith o th e r m e d i a c o m p a n i e s an d in d u s tries to attract in vestors. D ecision s are often b ased on h o w likely an inv estm ent or project will affect the c o m ­ p a n y ’s stock price or o verall value. A m edia c o m p a n y m a y not invest in or d evelo p a p rod uc t th at could help its com p etitiv e position in the long term if m a n a g e m e n t thinks the m o v e cou ld h arm its position in in v e s tm e n t m arkets in the short term. T h is c h a p tc r p r o v i d e s an o v e r v i e w o f the m a r k e t a n a ly s is p ro c e s s . It o u tlin e s the e le m e n ts o f p ro d u c t , g e o g r a p h i c , an d i n v e s tm e n t m a r k e ts tha t m e d i a m a n ­ ag e rs n e e d to m o n ito r . T h e w a y s th o s e e le m e n ts are e v a lu a te d in the m e d i a in ­ d u stry als o are d is c u sse d .

T HE PROCESS OF MARKET ANALYSIS T h e m a r k e t a n a ly s is p r o c e s s c o n s is ts o f c a re f u lly e x a m i n i n g three ty p e s o f fa ctors: ex te rn a l c o n d itio n s , in tern al c o n d itio n s , an d financial c o n d itio n s (S tev en s, S h e r w o o d , & D u n n , 1993). E x te rn a l c o n d it io n s in c lu d e lo n g - te rm tr e n d s such as m a r k e t g r o w th , d e m a n d fo r the p ro d u c t , p o li ti c a l/ re g u l a to ry c o n d it io n s and

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te chn olog ical trends, as well as m ore specific factors in a given m arket such as m arket structure, acc ess to distribution ch ann els, target market, and the m a r k e t’s e c o n o m ic and sociolo gical e n v iro n m e n ts. Internal c o nd ition s include the c o m ­ p a n y ’s m ission, objectives, capabilities, current pro du cts, and resources. F in a n ­ cial c o nd itio ns inclu de rev en u e estim ates, cost estim ates, return on inv estm ent, and intangible benefits. In practice, these factors o verlap and m utu ally influence o ne another. H o w e v e r, the cate go ries pro vide a useful fram ew o rk for trying to m a k e sense o ut o f a c o m p lc x proccss.

External Conditions M o s t discu ssion s o f m ark et analysis focus on external c onditions. This is b e ­ c au se there are m o r e external factors to c on sider, w h ich m a n a g e rs view as m o re c o m p le x and less c ontrollab le th an in ternal o r financial co nsid era tion s. T h e sp e ­ cific ex tern al con dition s th at a m a n a g e r e x a m in e s in a m ark et analysis vary from situation to situation. Y et in a m edia m a rk et analysis, there arc c o m m o n issues that need to be add ressed. S o m e issues in volve forecasting key long-term trends, w h ereas others inv olve an aly zin g specific ele m e n ts o f m a rk e t conditions.

Forecasting Important Long-Term Trends T r e n d s in M a r k e t G r o w th a n d D e v e lo p m e n t. T h e first question asked in a m arket analysis is: W h a t are the overall trends and d ev e lo p m e n ts in the m ark et for the p ro du ct? T h is can be a difficult question for m ed ia m a n a g e rs to answ er. C o n s u m e r d e m a n d for m ed ia pro du cts has steadily in creased in recen t decades. H o w e v e r, b eca u se o f in creased com petition , au d ie n c e fra g m en tatio n , and c h a n g ­ ing c o n s u m e r tastes, d e m a n d fo r som e m ed ia pro du cts d ecreased . B etw een 1993 and 1998, the av erage n u m b e r o f h ou rs th at A m e ric a n s listened to radio fell 3% and should dcclinc further by 2003 (U .S. C en su s B ureau, 2000). In the n ew sp ap er industry betw een 1964 and 1997, average w eek day readership in the U.S. adult population fell from 79.9% to 54.9% (N ew s p ap er A ssociation o f A m erica, 1999). In contrast, the average n u m b e r o f hours A m erican s spent w atching TV increased in the 1990s. Y et the n u m b e r o f channels available to view ers increased even faster, so the average audience size for individual channels, netw orks, and p ro ­ g ram s fell sharply (A da m s & Eastm an, 2002). A lth o u g h such long-term trends ap p e ar d isco ura gin g, they do not m ean that m ed ia p rod ucts are p o o r in ve stm e nts or m ed ia m a n a g e rs shou ld not c o n sid e r e n ­ tering these o r o th er m arkets. E ven m ore im po rtan t, a trend at the natio n al level m ay not apply to a specific g eo grap hic m arket. A m ark e t analysis should look at both national and local trends.

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A n o t h e r area o f tren d fo r e c a s tin g critic al to m e d i a m a n a g e r s is d e m o g r a p h ic s . D a ta fro m th e 2 0 0 0 c e n s u s s h o w e d that f e w e r th an 7 0 % o f the U .S. p o p u la tio n iden tified t h e m s e l v e s as W h it e o n ly , n o n - H is p a n ic . T h e e c o n o m i c p o w e r o f m i ­ no rity c o m m u n i t i e s g rew sig n ific a n tly in r e c e n t d e c a d e s . A d d iti o n a ll y , in the early 2 1 st c e n tu r y , the U n ite d S tates w a s u n d e r g o i n g the la r g e s t w a v e o f i m m i ­ g ra tio n in its h is to ry , c re a tin g la rg e p o p u la t io n s fo r w h o m E n g lis h w a s a s e c o n d la n g u a g e . T h e s e tr e n d s m e a n t th at the a u d ie n c e for U .S . m a s s m e d ia b e c a m e m u c h less o f a m a s s w ith m o r e d e m a n d fo r d iv e r s ity in m e d i a co n te n t. In a d d itio n to c h a n g e s in th e p o p u la t io n m a k e u p , lifestyle c h a n g e s also affect the m a r k e t fo r m e d i a p ro d u c ts . S in c e the 1970s, w o m e n h a v e e n te r e d the U .S. w o r k f o r c e in larg e n u m b e r s ; b y 2 0 0 1 , 6 0 % o f all w o m e n w o r k e d o u ts id e the h o m e (U .S . C e n s u s B u re a u , 2 0 0 1 ). T h is o n e c h a n g e r e la te s to se v e ra l m a j o r tren d s th a t e m e r g e d in m e d i a m a r k e ts o v e r the s a m e perio d : D e m a n d fo r d a y ti m e T V p r o g r a m m i n g d e c lin e d . D riv e tim e an d w o r k p la c e liste n in g in c r e a s e d in i m ­ p o rta n c e for rad io as the in h o m e d a y ti m e a u d ie n c e d e c lin e d . A s w o m e n m o v e d into the w o r k f o r c e an d the a v e r a g e n u m b e r o f h o u rs A m e r i c a n s s p e n t w o r k in g in c r e a s e d o v e r th e p a st few d e c a d e s , d e m a n d for n e w s p a p e r s s h ifte d fro m e v e n in g to m o r n in g d e liv e rie s. B y the en d o f th e 1990s, th e s a m e tren d a p p e a r e d in T V n ew s. R a ti n g s f o r ea rly e v e n in g T V n e w s c a s t s d e c lin e d . W o m e n w h o did n ot w o rk o u ts id e the h o m e d o m i n a te d the a u d ie n c e b e c a u s e f e w e r p e o p le in the la b o r fo rce w e r e h o m e by 5 :3 0 p .m . B y the en d o f th e 1990s, m u c h o f the c o m p e t it io n for lo cal T V n e w s a u d ie n c e s shifted to the early m o r n in g d a y p a r t (5 a . m . - 7 a.m .), w h e n th e m a s s a u d ie n c e w a s h o m e p re p a r in g fo r the w o r k d a y . T h e s e e x a m p l e s illu strate the i m p o r t a n c e o f c o n s i d e r ­ ing b o th d e m o g r a p h ic an d lifestyle tr e n d s in m e d i a m a r k e t a n a ly s e s. T r e n d s in P r o d u c t D e m a n d .

D e m a n d m e a s u r e s the q u a n tity o f a p ro d u c t

p e o p le w ill b u y at a p a rt ic u l a r p rice. D e m a n d is a fu n c tio n o f th e p ric e o f the p ro d u c t, the p rice o f su b s titu te s an d c o m p l e m e n t s f o r the p ro d u c t, th e i n c o m e o f c o n s u m e r s , an d c o n s u m e r taste (S tig lcr, 1952). Price.

P ric e is n e g a tiv e ly r e la te d to d e m a n d fo r m o s t p ro d u c t s an d serv ices.

A s p ric e s go up, d e m a n d g o e s d o w n an d vice versa. T h e re la tio n s h ip b e tw e e n the c h a n g e in p rice an d d e m a n d is c a lle d e la s ticity o f d e m a n d , an d it v a rie s from p ro d u c t to p ro d u c t. W h e n the price o f a p r o d u c t in c r e a s e s 1%, if d e m a n d d e ­ c re a s e s m o r e tha n 1%, d e m a n d fo r the p r o d u c t is said to be ela stic. If d e m a n d d e c r e a s e s less th an 1% w h e n the price rise s 1%, d e m a n d fo r the p r o d u c t is in ­ e la stic. If p rice an d d e m a n d c h a n g e at the s a m e rate, the p r o d u c t is said to h a v e u n i t elasticity. E la stic ity o f d e m a n d is a m e a s u r e o f h o w se n s itiv e d e m a n d is to c h a n g e s in p ric e o r e c o n o m i c c o n d it io n s . M e d i a m a n a g e r s n e e d to u n d e r s ta n d the n a tu r e o f th e d e m a n d fo r th e ir p r o d u c t s b e c a u s e it d ire c tly a ff e c ts th e ir ability to set prices.

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F o r e x a m p l e , if d e m a n d f o r a p r o d u c t is in elastic, th en a p ric e in c r e a s e w ill likely re s u lt in h ig h e r r e v e n u e s b e c a u s e d e m a n d w ill fall m o r e s lo w ly th a n the p rice rises. H o w e v e r , if p r o d u c t d e m a n d is e la s tic , th e n a p ric e in c r e a s e can actu a lly c o st the c o m p a n y m o n e y by c a u s in g a d e c r e a s e in the total r e v e n u e s that the c o m p a n y g e n e ra t e s fr o m sales. F o r e x a m p l e , c o n s i d e r the case o f a city m a g a z in e e n title d D o w n t o w n , w h ic h h a s a cir c u la tio n o f 1 0 0 ,0 0 0 p e r m o n th . If th e su b s c rip tio n p ric e is $1 p e r c o p y , D o w n t o w n w ill g e n e ra te $ 1 0 0 ,0 0 0 p e r m o n t h in cir c u la tio n re v e n u e . If d e m a n d fo r th e m a g a z in e is in e lastic , w h e n m a n a g e m e n t in c r e a s e s the c o v e r p rice to $ 1 .2 5 , the c o m p a n y w ill actu a lly in c r e a s e its m o n t h ly c ir c u la tio n r e v e n u e to $1 12,500 e v e n if the n u m b e r o f s u b s c rib e r s falls to 9 0 ,0 0 0 b e c a u s e o f the price in c re a se . T h e gain in r e v e n u e from the p ric e in c r e a s e w ill be g r e a t e r than the loss in r e v e n u e fro m the d ro p in c irc u la tio n . H o w e v e r , b e c a u s e m e d i a is a j o i n t c o m m o d i t y , the m a r k e t a n a ly s t m u s t c o n ­ s id e r the im p a c t o f the c ir c u la t io n loss on a d v e rtisin g . A d v e r ti s e r s b u y s p a ce b a s e d o n cir c u la tio n size, an d a d v e rtis in g rates u su a lly fall w h e n c ir c u la tio n falls. T h u s , a d v e rtis in g r e v e n u e s m a y also d e c lin e if the p ric e in c r e a s e c a u s e s a d r o p in d e m a n d fo r su b s c rip tio n s . If a 10% d e c lin e in D o w n t o w n 's cir c u la tio n c a u s e d a 10% d ro p in a d v e rt is i n g re v e n u e , the n the g a in in c ir c u la tio n r e v e n u e fro m the p ric e in c r e a s e w o u ld not m a k e up for th e loss in a d v e rt is i n g r e v e n u e fro m the fall in a d v e rtis in g rates. P ric e ela s tic ity in b o th the a d v e rtis in g an d a u d ie n c e m a r k e ts are c o n s i d e r e d w h e n a m e d i a c o m p a n y c h a n g e s p ric e s in one. T h e c o n c e p t o f e las ticity o f d e m a n d is also u sed to m e a s u r e e ff e c ts th at c h a n g e s in the o v e ra ll h e alth o f the e c o n o m y h a v e on d e m a n d f o r a p ro d u c t. In th e m e d i a in d u s try , d e m a n d fo r a d v e rtis in g tim e and s p a c e te n d s to be sen s itiv e to the state o f the e c o n o m y . T h e n u m b e r o f a d s a c o m p a n y b u y s is o p tio n a l, and ad v e rtis in g is g e n e ra l ly o n e o f the first b u d g e t lines c o m p a n i e s c u t w h e n sales dip. A s a resu lt, the m e d i a in d u s try is h ig h ly v u ln e r a b le to n a tio n a l an d lo cal e c o ­ n o m i c s w in g s , an d e v e n a slig h t d o w n tu r n c o u ld re s u lt in h irin g f r e e z e s o r la y ­ offs at the lo cal n e w s p a p e r , rad io, o r T V station. O n the c o n s u m e r side, d e m a n d fo r m e d i a p ro d u c ts is re la tiv e ly ine lastic, a lt h o u g h it v aries from p r o d u c t to p ro d u c t. F ree o v c r - th c - a i r ra d io and T V arc la rg e ly im m u n e to price an d the e c o n o m y b e c a u s e c o n s u m e r s p a y n o th i n g to re c e iv e th e m . D e m a n d fo r e x p e n s i v e p r e m i u m c h a n n e l s an d digital se rv ic e s fo r c a b le are m o r e sen s itiv e to s w in g s in price a n d the e c o n o m y th an the d e m a n d fo r b asic c a b le services. P rice ela s tic ity is often re la te d to the n u m b e r o f a v a ila b le s u b s titu te p ro d u c ts. T h e g r e a t e r the a v a ila b ility o f c o m p a r a b l e p ro d u c t s , the g r e a t e r the p rice e la s ti c ­ ity for all o f th em . P r ic e o f S u b s t it u te s a n d C o m p l e m e n t s .

A s u b s titu te is a p r o d u c t th a t ca n be

u se d in p la c e o f a n o th e r p ro d u c t. P ay p e r v ie w is a s u b s titu te p r o d u c t fo r b o th

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m o v i e re n ta ls and the th eater. A c o m p l e m e n t is a p r o d u c t p u r c h a s e d to use w ith a n o th e r p ro d u c t. V i d e o ta p e s are a c o m p l e m e n t p r o d u c t to V C R s , w h ic h are u s e ­ less w ith o u t th e m . If the p ric e o f su b s titu te p r o d u c t s is sig n ific an tly l o w e r and the utility— the u s e f u ln e s s o r sa tisf a c tio n th at th e c o n s u m e r gets fro m the su b s titu te is c o m p a r a b l e — then d e m a n d fo r the o rig in a l p r o d u c t falls. If the p rices o f c o m p l e ­ m e n t a ry p r o d u c t s are too hig h , the n d e m a n d fo r the p r o d u c t falls. If the a v e ra g e c o st o f a D V D ren ta l w e re $2 5 a n ig h t, there w o u ld be little d e m a n d f o r D V D p lay ers. C o n su m er Incom e.

A p e r s o n ’s d e m a n d fo r p ro d u c t s is re la te d to in c o m e . A s

a p e r s o n ’s i n c o m e rises, th ere is m o r e d is c re ti o n a ry m o n e y to s p e n d on o p tio n a l g o o d s and se r v ic e s su c h as in f o rm a t io n and e n te r ta i n m e n t . D e m a n d fo r m e d i a p r o d u c t s v a rie s w id e ly a c ro s s in d iv id u a ls . T h o s e w h o use in f o rm a t io n d ire c tly in th e ir w o rk , su c h as b u s i n e s s m a n a g e r s , finan cial a d v is e rs , an d te a c h e rs , te n d to s p e n d a h ig h e r p e r c e n t a g e o f th eir i n c o m e on in f o rm a tio n p r o d u c t s b e c a u s e it is a p r o f e s s i o n a l in v e s tm e n t. M o s t p e o p le , h o w e v e r , m a k e the m a jo rity o f m e d i a e x ­ p e n d it u re s fo r e n te r ta i n m e n t . In g e n e ra l, an in c r e a s e in i n c o m e w o u ld b e e x ­ p e c te d to g e n e ra t e in c r e a s e d d e m a n d fo r m e d i a p ro d u c t s , b u t th e re la tio n sh ip m a y n ot be p ro p o r tio n a te . C o n s u m e r in c o m e also affec ts d e m a n d in the a d v e rt is i n g sid e o f the m a r k e t for m e d i a p ro d u c ts . A d v e r ti s e r s g e n e ra lly p r e f e r to re ach a u d ie n c e m e m b e r s w ith h ig h e r in c o m e s b e c a u s e th o s e in d i v id u a l s h a v e m o r e d is c re tio n a ry i n c o m e a v a il­ a b le to s p e n d on p r o d u c t s — b oth n e c e ss itie s an d lu x u ries. T h u s , p o p u la t io n s w ith h ig h e r a v e ra g e in c o m e s are m o r e attra c tiv e to a d v e rtis e rs th a n th o s e w ith lo w e r i n c o m e s . A d v e r ti s e r s are o fte n w illin g to p a y h ig h e r ra tes to r e a c h h ig h - in c o m e a u d ie n c e s . C o n s u m e r T a stes.

C o n s u m e r taste is a g e n e ra l c o n c e p t th a t c o v e rs q u e s t io n s

o f w h y a u d ie n c e s s e le c t the p r o d u c t s th e y d o. T h e r e are few th e o r ie s th a t p re d ic t c h a n g e s in c o n s u m e r taste, b u t from an e c o n o m i c s ta n d p o in t it ca n be said that c o n s u m e r s m u s t find utility in a p r o d u c t to be w illin g to b u y it. U tility is the u s e f u ln e s s o r s a tisfa c tio n th at a c o n s u m e r d e riv e s fro m u sin g s o m e th i n g . M a n y p r o d u c t s that m e d i a c o m p a n i e s t h o u g h t w e r e su re th in g s failed b e c a u s e c o n s u m e r s did n o t find th em usefu l. In the 1980s and early 1990s, for e x a m p l e , o rd e r in g p iz z a o n lin e w a s p r o m o te d as a r e a s o n fo r s u b s c rib i n g to V id e o te x t an d o n lin e se rv ic e s, b u t c o n s u m e r s f o u n d it e a s i e r to use the p h o n e . C o n s u m e r ta s tes are c h a n g e a b l e an d difficult to p re d ic t. Y e t re s e a rc h on in f o r­ m a tio n use (L a c y & S im o n , 19 9 3 ), u se s an d g ra tific a tio n s (S e v e r in & T a n k a r d , 1992), and d e p e n d e n c y th e o r y iden tified s o m e g e n e r a l w a y s th at p e o p le use m e d ia . T h e s e u se s in c l u d e s u r v e illa n c e , d e c is io n m a k i n g , d iv e r s io n , so cialc u ltu ra l in te ra c tio n s, an d s e l f-u n d e r s ta n d i n g .

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S u rv e illa n c e in c lu d e s m o n ito r in g the e n v ir o n m e n t to iden tify ne w useful o r in ­ terestin g in f o rm a tio n . D e c is io n m a k i n g in v o lv e s c o n s c i o u s in f o r m a t io n - s e e k in g b e h a v io r s w ith the g o a l o f d e c id i n g o n a c o u r s e o f a c tio n . D iv e rs io n in c lu d e s u sin g m e d i a p r o d u c t s fo r e n t e r t a i n m e n t or d is tra c tio n . S o c ia l-c u ltu ra l in te ra c tio n in c lu d e s u sin g in f o rm a t io n o r m e d i a to e s ta b lis h c o m m o n g r o u n d w ith o thers. D is c u s s in g a n e w s o r spo rts story at the o ffice or, fo r t e e n a g e rs , b e in g in f o rm e d a b o u t th e c u rr e n t h o t p o p star h e lp e s ta b lis h b o n d s w ith o th e r p e o p le a n d m a y be a s o u r c e o f p o w e r w ith in a s o cial o r p r o f e s s i o n a l g ro u p . S e lf - u n d e r s ta n d i n g is the use o f m e d ia o r in f o r m a t io n to d e v e lo p p e rs o n a l v a lu e s y s te m s or p h ilo s o p h i e s or i m p ro v e the ab ility to m a n a g e o n e ’s life. F o re c a s tin g c o n s u m e r d e m a n d is a lw a y s difficult. Y e t a tten tio n to the c o n c e p t o f utility and to w h a t is k n o w n a b o u t h o w an d w h y p e o p le use m e d i a is an i m ­ p o rt a n t step in m a r k e t an aly s is. T r e n d s in P o l i t i c a l / R e g u l a t o r y C o n d it io n s .

T e l e c o m m u n i c a t i o n s in d u s trie s

suc h as b r o a d c a s ti n g an d c a b le are s u b je c t to g o v e r n m e n t re g u la tio n . B e c a u s e r e g u la to r y p o lic ie s c h a n g e o v e r tim e, a m a r k e t an a ly s is m u s t c o n s i d e r th e c u rre n t state o f re g u la tio n in b o th the p r o d u c t an d g e o - g r a p h ic m a r k e ts an d an y lo o m in g c h a n g e s . F o r e x a m p l e , in 1996, the T e l e c o m m u n i c a t i o n s A c t r e m o v e d the lim it on the n u m b e r o f ra d io sta tio n s o n e c o m p a n y c o u ld o w n n a ti o n w i d e . T h a t r e g u ­ lato ry c h a n g e set o f f a w a v e o f ra d io c o n s o l id a t io n tha t m a d e it d ifficult fo r sm all ra d io c o m p a n i e s to s u r v iv e in larg e m a r k e ts . In a n o th e r e x a m p l e , an in c re a se in th e p rice o f p o s t a g e can d ra m a ti c a ll y raise d is trib u tio n c o sts an d re d u c e profits fo r w e e k ly n e w s p a p e r s , m a g a z in e s , an d n e w sle tte rs. M e d i a c o m p a n i e s a re in c r e a s i n g ly lo o k in g to f o r e ig n m a r k e ts fo r fu tu re g ro w th . C a b le n e tw o r k s are f r e q u e n tly d is trib u te d b y sate llite an d lo c a l c a b le s y s te m s in c o u n tr ie s a r o u n d th e w o rld . F o r m e d i a p r o d u c t s h a v in g g lo b a l m a r k e t p o te n tia l, su c h as c a b le n e tw o r k s an d T V p r o g r a m s , a m a r k e t a n a ly s is m u s t i n ­ c lu d e an e x a m i n a ti o n o f in te rn a tio n a l trad e r e g u la tio n s , and n a tio n a l an d re g io n a l r e g u la tio n s g o v e r n i n g f o r e ig n o w n e r s h i p o f m e d ia , o r the sale an d d is trib u tio n o f fo r e ig n - p r o d u c c d m e d i a co n te n t. A d d iti o n a ll y , a m a r k e t a n a ly s is c o n d u c te d b e ­ fore in v e s tin g o v e rs e a s w o u ld e x a m i n e the r e g u l a ti o n s that m i g h t a f f e c t b u s i n e s s c o n d it io n s in a local m a rk e t, j u s t as is d o n e in a d o m e s ti c m a r k e t. T h o s e r e g u l a ­ tions w o u ld in c lu d e such th in g s as w a g e a n d h o u r la w s, tax la w s, b u s i n e s s r e ­ striction s, an d so on. T ec h n o lo g y F orecasting.

T h e m e d i a in d u s try is o n e o f the in d u s trie s m o s t

a f f e c te d by e m e r g in g te c h n o l o g ie s in r e c e n t d e c a d e s (D a y & S c h o e m a k e r , 2 0 0 0 ). T h u s , m a r k e t a n a ly s e s m u s t take a c c o u n t o f the o p p o rt u n it ie s an d th re a ts that ne w t e c h n o l o g ie s m a y p o se . In the early 198 0s, the d e v e l o p m e n t o f the v id e o t a p e r e c o r d e r t h r e a te n e d to s ip h o n o f f a u d ie n c e s from m o v i e th e a te rs an d T V . O v e r th e lo ng term , V C R s and th e ir n e w c o m p e t it o r s , D V D s , p r o v e d to b e a p ro b le m f o r T V n e tw o r k s , b ut a fina ncia l o p p o r t u n it y fo r H o lly w o o d . F ilm s tu d io s g a in e d

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a n e w r e v e n u e s o u r c e in m o v i e re n ta ls and sales w h ile T V lost a u d ie n c e s to m o v i e re n ta ls and r e c o r d e d p ro g r a m m i n g . In the 1990s, the In te rn e t c r e a te d n e w c o m p e t it io n fo r the n e w s p a p e r in d u s try . It a ll o w e d T V and rad io sta tio n s to o ff e r p rin t v e rs io n s o f th e ir n e w s c a s t s to o n lin e r e a d e r s an d p r o v i d e d a n ew classifie d a d v e rtis in g m e d i u m — a critical n ew sp ap er revenue

so u rc e .

N a p s te r an d

o th e r o n lin e

p ro v i d e r s

th r e a te n e d

m u s ic in d u s try sales by m a k i n g it e a sy for u sers to c o p y a n d sh a r e m u s ic o v e r the In tern et. T h e tu rn o f the 2 1 st c e n tu r y saw lo cal ra d io statio n m a n a g e r s a n x io u s ly fo r e c a s tin g the e f f e c t satellite ra d io w o u ld h a v e on th e i r m a r k e ts w h ile T V e x e c ­ u tiv e s w a r n e d c o n s u m e r s th a t u sin g d ig ital re c o r d e rs to za p T V a d s c o u ld m e a n the en d o f free o v e r- th e - a i r T V ( K e m p n e r , 2 00 2). E x p e r ts p re d i c t th at the p a c e o f c o m m u n i c a t i o n te c h n o l o g y in n o v a tio n will c o n ti n u e to a c c e le ra te . M e d i a m a n a g e r s n e e d to c o n s t a n tl y m o n i to r th e se t e c h n o ­ log ical d e v e l o p m e n t s fo r th eir p o te n tia l as b u s i n e s s o p p o rt u n it ie s a n d th reats. N o m a r k e t a n a ly s is is c o m p l e te w ith o u t c a re fu l c o n s id e r a t io n o f the e m e r g i n g i n n o ­ v a tio n s th at w ill influ en ce the m e d i a m a r k e t s e c t o r o f interest.

Analyzing Specific Factors in the M a r k e t A m a r k e t a n a ly s is in c lu d e s a c a re f u l e x a m i n a ti o n o f the specific c o n d it io n s that affect su c c e s s in a g iv e n p r o d u c t o r g e o g r a p h i c m a r k e t. A m o n g the c o n d it io n s to c o n s i d e r are m a r k e t stru c tu re , e x is tin g te c h n o l o g ie s , n a tu re o f the ta r g e t m a r k e t, and th e m a r k e t ’s e c o n o m i c and s o c i o lo g i c a l e n v ir o n m e n t s . M a r k e t S tru ctu re.

W h e n m a n a g e r s a n a ly z e th e m a r k e t in w h ic h th ey o p e r ­

ate, an im p o rta n t c o n s id e ra tio n is m a r k e t structure. M a r k e t stru cture an aly s is is co n d u c te d for b o th p ro d u c t and g eo g ra p h ic m a rk ets, but it is p e rh a p s easiest to u n ­ d e rs ta n d w h e n d e s c r ib e d in th e c o n te x t o f the g e o g r a p h i c m a rk e t. M a r k e t s tru c ­ ture c o n s is ts o f six e le m e n ts : (a) selle r c o n c e n t r a ti o n , (b) b u y e r c o n c e n t r a ti o n , (c) b a rrie rs to en try , (d) p r o d u c t d if fe re n tia tio n , (e) c o s t stru c tu r e s, an d (f) vertica l in te g ra tio n . E a c h o f th ese e le m e n ts is c o n s i d e r e d se p a r a te ly . S e ll e r C o n c e n tr a tio n .

S e ll e r c o n c e n t ra ti o n is a m e a s u r e o f the n u m b e r o f

c o m p e t it o r s in the m a r k e t. If th ere are too m a n y c o m p e t it o r s , it is difficu lt for n e w c o m p a n i e s to e n te r the m a r k e t an d earn e n o u g h m o n e y to su rv iv e . T h is is o n e o f the c h a ll e n g e s f a c in g o n lin e m e d i a c o m p a n i e s . T h e r e are m o r e than 2 b il­ lion W e b sites a v a ila b le to a u d ie n c e s , and m a n y sell a d v e rtis in g . C o n s e q u e n tl y , it is d ifficu lt to a ttra ct a larg e e n o u g h a u d ie n c e to any g iv en W e b site to m a k e it attractiv e to a d v e rtise rs. T h e tr e m e n d o u s c o m p e t it io n fo r th o s e a d v e rtis e rs in t e r­ ested in b u y in g s p a c e o n li n e d riv e s d o w n o n lin e a d v e rt is i n g rates. H o w e v e r , it can be j u s t as d ifficult, if n o t m o r e difficult, to e n te r a h ig h ly c o n ­ ce n tr a te d m a r k e t w h e r e th e r e a re o n ly a few sellers o r p e r h a p s e v e n ju s t o n e

194

CHAP T E R 8

seller. S e lle rs in c o n c e n t r a te d m a r k e ts te n d to h a v e tr e m e n d o u s m a r k e t p o w e r an d ca n c a p tu r e e c o n o m i e s o f scale th a t s m a ll e r c o m p a n i e s c a n n o t realize. T h is g iv e s la r g e r c o m p a n i e s a p r o d u c t i o n - c o s t a d v a n ta g e to r e d u c e p ric es b e lo w w h a t th e ir s m a ll e r c o m p e t it o r s ca n a fford. T h e o p ti m a l n u m b e r o f c o m p e t it o r s in a m a r k e t d e p e n d s on the size o f the m a r k e t and d e m a n d fo r the p ro d u c t. A n a ly z in g seller c o n c e n t r a ti o n is n o t s im p le b e c a u s e d if fe re n t ty p e s o f m e d ia are s u b s titu te p r o d u c t s fo r o n e a n o th e r fo r both c o n s u m e r s a n d a d v e rtise rs. S o m e o n e a n a ly z in g the ra d io m a r k e t in a p a rtic u la r to w n c a n n o t j u s t e x a m i n e o t h e r rad io statio ns. T h e y m u s t also c o n s i d e r the n u m ­ b e r o f n e w s p a p e r s , m a g a z in e s , T V statio ns, c a b le an d satellite c h a n n e l s , and m o v i e th e aters, as w e ll as the lo ca l lev el o f o n lin e use. T h e s e m e d i a all c o m p e t e fo r the a u d i e n c e ’s tim e an d a tten tio n . A p e rs o n w h o is w a tc h in g T V c a n n o t e f ­ fe c tiv e ly listen to ra d io at the s a m e tim e. A p e rs o n w h o is r e a d in g the p rin t v e r ­ sion o f th e n e w s p a p e r c a n n o t b e o n lin e s im u l ta n e o u s l y . In d e e d , in the battle for a u d ie n c e s in re c e n t d e c a d e s , th e g re a t e s t c o m p e t it io n a m o n g m e d i a c o m p a n i e s h a s b e e n fo r c o n s u m e r s ’ tim e, n ot th e ir m o n e y . M e a s u rin g seller c o n c e n tra tio n as it relates to a dv ertise rs is ev en m o r e c o m p l i ­ cate d. B esid e s th e m e d ia alread y listed, there are o th er c o m p e tito rs for ad vertising. O u t d o o r a d v e rtis in g c o m p a n i e s , d ir e c t m a il c o m p a n i e s , an d sp o rts are n a s , to n a m e a few , als o c o m p e t e fo r a d v e rtisin g . S in c e 1996, c h a n g e s in the U .S . b r o a d c a s t in d u s try h a v e m a d e seller c o n c e n ­ tration e v e n m o r e d ifficult to a ss ess. B r o a d c a s t in d u s try c o n s o l id a t io n m e a n s th at in m a n y m a r k e ts , a lt h o u g h th e r e are still n u m e r o u s ra d io sta tio n s on the dial, m a n y are o w n e d by the s a m e c o m p a n y , lo cated in the s a m e b u ild in g , an d m a n ­ ag ed by the s a m e m a n a g e m e n t team . C o m p a n i e s o w n in g clu s ters o f rad io statio ns or, m o r e re cen tly , tw o T V statio ns in the s a m e m a r k e t can c a p tu r e e c o n o m i e s o f scale th at giv e th e m a c o m p e t it iv e a d v a n ta g e . T y p ic a l ly , th ey o ffe r b u n d le d , m u ltista tio n a d v e rt is i n g p a c k a g e s at a d is c o u n te d price. F o r a d v e rtis in g clien ts, b u n d li n g is less e x p e n s i v e and m o r e effic ien t b c c a u s c th e y ca n b u y ti m e on m u l ­ tiple sta tio n s w ith o n e deal. N o r c a n the m e d i a m a r k e t a n a ly s t ig n o r e the e ff e c ts o f m e d i a c o n s o l id a t io n at a n o th e r level. If a m a j o r c o rp o r a ti o n o w n s a m e d i a ou tlet, it g e n e ra l ly h a s m o r e r e s o u rc e s a v a ila b le to it th an a m e d i a c o m p a n y th a t is in d e p e n d e n tly o w n e d or o w n e d b y a s m a ll e r c o m p a n y . F o r e x a m p l e , a rad io station w ith a c o rp o r a te o w n e r th a t h o ld s 1,000 sta tio n s a c ro s s the U n ite d S ta te s a lm o s t c e rta in ly h as m o r e fin a n c in g an d e x p e rtis e a v a ila b le to it th an a station o w n e d by a lo cal f a m ­ ily o r c h u rc h . In b u s in e s s , this is k n o w n as h a v in g d e e p p o c k e t s , and a m a r k e t a n a ly s is s h o u l d lo ok at the n u m b e r o f c o m p e t it o r s in the m a r k e t th at h a v e s ig n ifi­ ca n t c o rp o r a te r e s o u rc e s a v a ila b le to them . B u y e r C o n c e n tr a tio n .

T h is is a m e a s u r e o f th e n u m b e r o f b u y e rs in the m a r ­

k e tp la c e fo r the p ro d u c t . F o r m e d i a c o m p a n i e s , the m o s t im p o r t a n t e le m e n t o f

M ARKE T ANALYSI S

195

b u y e r c o n c e n t r a ti o n is th e n u m b e r an d ty p e o f p o te n tia l a d v e rtis e rs in a m a rk e t. N o t all b u s i n e s s e s are p o te n tia l a d v e rtise rs. C o m p a n i e s th at b uy m a s s m e d i a a d ­ v e rtis in g g e n e ra lly d o d ir e c t- to - c o n s u m e r sale s, su ch as a u t o m o b il e d e a le rs or f a s t-f o o d re s ta u ra n ts . L o c a l m a n u f a c tu r e r s , g o v e r n m e n t a g e n c ie s , an d b u s in e s s t o - b u s in e s s su p p lie rs are g e n e ra l ly n ot p o te n tia l a d v e rtis e rs e x c e p t in sp e c ia liz e d m e d ia su c h as b u s in e s s an d legal n e w s p a p e rs . H a v in g too little b u y e r c o n c e n t r a ti o n in a m a r k e t m e a n s th ere are m a n y a d v e rtis e rs an d e a c h b u y s o n ly a little tim e or sp a c e . In su c h a m a r k e t, it c o sts the m e d i a c o m p a n y m o r e to locate an d n e g o tia te w ith so m a n y s m a ll c u s t o m e r s th an it ca n r e c o v e r in re v e n u e s fro m the sales. T h e c o m p a n y c o u ld n o t su rv iv e o v e r the lo n g term . T h is is a p r o b l e m fa c in g firm s th a t sell a d v e rtis in g space o nlin e. T h e m o r e c o m m o n p r o b l e m in m e d i a m a r k e ts , h o w e v e r , is too m u c h b u y e r c o n c e n t ra ti o n . T h e r e m a y be o n ly a few m a j o r a d v e rt is i n g c lie n ts in a rural m e d i a m a r k e t, r e p r e s e n ti n g a larg e p e r c e n t a g e o f the r e v e n u e e a r n e d b y local m edia com panies.

W h e r e b u y e r c o n c e n t r a ti o n

is hig h , an a d v e r t is e r g ain s

t r e m e n d o u s p o w e r in n e g o tia tin g a d v e rtis in g rates an d o t h e r be nefits su ch as p o s ­ itive n e w s c o v e r a g e o f th e ir b u s in e s s . T h e m e d i a c o m p a n y c o m p l ie s b e c a u s e it c a n n o t a ffo rd to lo se th e client. T h u s , a m e d i a m a r k e t a n a ly s is c o n s i d e rs the n u m b e r an d q u a lity o f p o te n tia l b u y e rs as th ey relate to the n u m b e r o f se llers in the s a m e m a rk e t. B a r r i e r s to E n try .

A b a rr ie r to en try is a n y th i n g th a t m a k e s it d ifficu lt fo r a

n ew c o m p e t i t o r to e n te r the m a rk e t. A lth o u g h b arrie rs to en tr y v a ry by in d u s try , three c o m m o n b a rrie rs in the m e d i a in d u s try are hig h fixed c o sts, g o v e r n m e n t r e g u la tio n , and the m a r k e t p o w e r o f e x is tin g sellers. F ix e d c o sts are th o s e a c o m p a n y in c u rs to p r o d u c e o n e u n it o f its p ro d u c t. S a id a n o th e r w a y , th e y are the c o sts a c o m p a n y p a y s j u s t to be in b u s in e s s . A c o m p a n y has little ab ility to a d ju s t or c o n tr o l fixed co sts. F ix e d c o sts in c lu d e the b u ild in g the b u s i n e s s is in, utilities, in s u ra n c e , p e rs o n n e l an d e q u i p m e n t n e e d e d to run the o p e ra t io n , a n d te c h n o l o g ie s n e e d e d to p r o d u c e an d d is trib u te the p r o d ­ uct. D a ily n e w s p a p e r s h a v e h ig h e r fixed co sts th an T V s ta tio n s b c c a u s c they n e e d m o r e e m p l o y e e s and h ig h - c o s t p rin tin g p r e s s e s to o p e ra te . T e le v is io n s t a ­ tion s h a v e h i g h e r fixed c o sts than rad io s ta tio n s b e c a u s e a g a in T V re q u ire s m o r e p e o p le an d e q u ip m e n t. H ig h fixed co sts in an in d u s try are an en try b a rr ie r b e c a u s e a tr e m e n d o u s a m o u n t o f i n v e s tm e n t c a p ita l is n e e d e d to b eg in o p e r a t io n s and stay in b u s i n e s s until the c o m p a n y g e n e ra t e s profits. G e n e ra ll y , it ta k e s at least se v e ra l y ea rs b e ­ fore a n e w m e d i a o p e ra t io n b e c o m e s p rofitable. T h e h ig h e r th e fixed c o sts, the l o n g e r it ta k e s to r e a c h p ro fita bility, the m o r e m o n e y the in v e s to rs risk on the v e n tu r e , an d the less likely the n e w c o m p a n y w ill s u r v iv e long e n o u g h to b e ­ c o m e e sta b lis h e d in the m a rk e t.

196

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G o v e r n m e n t r e g u l a ti o n s are a n o th e r b a rr ie r to en try . U .S . b r o a d c a s te rs m u s t o b tain a lic e n se fro m th e fe d e ra l g o v e r n m e n t to o p e ra te . C a b le sy s te m o p e ra to rs o fte n h a v e fra n c h is e a g r e e m e n ts w ith lo cal g o v e r n m e n t s to p ro v i d e s e r v ic e to the c o m m u n i t y an d u se p u b lic rig h ts o f w a y for th e ir ca b le s. A n titru s t law s lim it the a m o u n t o f m a r k e t p o w e r o n e c o m p a n y ca n a tta in and lim it the n u m b e r an d ty p e o f m e d ia o u tle ts that o n e c o m p a n y c a n o w n in a sin g le g e o g r a p h i c m a rk e t. B o th se r v e as a b a rr ie r to en try an d as a m e a n s to l o w e r b a r ­ riers to en try . S u c h la w s are e n tr y b a rrie rs fo r large c o rp o r a ti o n s th a t a lr e a d y ha v e s u b s ta n tia l m a r k e t p o w e r b e c a u s e th e la w s re q u ire su c h c o m p a n i e s to get g o v e r n m e n t a p p r o v a l for a d d it io n a l a c q u is itio n s . F o r e x a m p l e , a fte r a n n o u n c in g the ir p la n s fo r a m e r g e r in 2 0 0 0 , A O L an d T im e W a r n e r h a d to g a in a p p r o v a l fro m the E u r o p e a n U n io n an d the U .S . Ju s tic e D e p a r t m e n t b e fo r e they c o u ld actu a lly c o m p l e te the deal. B y lim itin g the a m o u n t o f m a r k e t p o w e r th at any o n e c o m p a n y can attain, a n ­ titrust law s lo w e r entry b arriers for s m a ll e r c o m p a n i e s . W h e n a big c o m p a n y has too m u c h m a r k e t p o w e r, it can con tro l the facto rs th at in flu ence p ro d u c t d e m a n d and sq u e e z e s m a lle r c o m p a n i e s o u t o f the m a rk et. F o r e x a m p l e , a n atio n al m e d ia c o m p a n y w ith holdin gs in several industry sectors m ig h t give m o re radio air play on its stations n a tio n w id e to rec o rd in g artists w h o b o o k w ith its c o n c e rt-p ro m o tio n s s u b s id ia ry than it g iv es to artists w h o sign w ith a c o m p e tito r. T h is m a k e s it diffi­ cu lt fo r i n d e p e n d e n t c o n c e rt p ro m o te rs to b o o k artists, p a rtic u larly top artists. T h e a s s u m p ti o n b e h in d an titru st law s is th at c o n s u m e r s are b est serve d by h a v in g m a n y sellers in a m a rk e t, w h ic h e n h a n c e s p r o d u c t in n o v a tio n and re d u c e s prices. A lth o u g h m o s t m a r k e t a n a ly s e s c o n c e n t r a te on the n u m b e r a n d ty p e o f b a r r i­ ers th a t m a k e m a r k e t en try difficult, the c o m p l e te a b s e n c e o f b a rrie rs b e c o m e s a b a rrie r to en tr y in its o w n right. T h e o n lin e m e d i a in d u s try f a c e s j u s t this c h a l ­ len ge. W it h low fixed c o sts, n o g o v e r n m e n t r e g u la tio n , a n d few c o n te n t c o m p a ­ n ies w ith sig n ifican t p o w e r in the o n lin e m a r k e t, there are v irtu ally n o b a rrie rs to e n tr y to b e c o m i n g an o n lin e c o n te n t p ro v id e r. A n y o n e w h o can a ffo rd a c o m ­ pu ter, server, a n d te l e p h o n e line can d e v e lo p a W e b site and e n te r the m a rk e t. T h e re s u lt is a m a r k e t w ith m o r e th a n 2 billio n W e b sites, a h ig h ly fr a g m e n t e d a u d ie n c e , an d in s u fficien t b u y e r an d selle r p o w e r. A s a res u lt, rela tiv e ly few o n ­ line c o n te n t p ro v i d e r s ca n d e v e lo p profitab le b u sin e sse s . P r o d u c t D iffe re n tia tio n .

P ro d u c t d if fe re n tia tio n is a m e a s u re o f the a m o u n t

o f d if fe re n c e b e tw e e n the p r o d u c t s th a t se llers are o ff e rin g in the m a r k e t. M e d ia c o m p a n i e s are o ften a c c u s e d o f failing to o ffe r c o n s u m e r s m u c h p r o d u c t d if f e r ­ e n tiatio n . W h e n “ W h o W a n ts to b e a M i ll io n a i r e ? ” b e c a m e a b ig hit for A B C in the s u m m e r o f 1999, a lm o s t e v e ry n e tw o r k la u n c h e d its o w n v e rs io n o f the g a m e sh o w in p r i m e t im e d u ri n g tha t fall se a s o n . S im ila rly , the su c c e s s o f the reality sh o w “ S u r v i v o r ” s p a w n e d a tidal w a v e o f s e q u e ls an d sp in -o ffs. F o r the m a r k e t an a ly s t, the q u e s t io n is w h e t h e r the p ro j e c t b e in g p r o p o s e d is too s i m i la r o r too d if fe re n t fr o m w h a t is a lr e a d y in the m a r k e t. If it is too sim ilar,

MARKET ANALYSIS

197

c o n s u m e rs are u nlik ely to buy it b ecau se it has little utility for them . If the p ro d ­ uct is too different, the c o m p a n y p rod ucing it ta kes a m u ch g reater risk because m a n a g e rs will h a v e little ability to j u d g e the likely m ark e t for the p ro d u c t until the c o m p a n y m a k e s a substantial investm ent. The e c o n o m ic s o f info rm ation prod ucts m ak es p ro d u c t d ifferentiation a seri­ o us issue for m e d ia co m p a n ie s. In m o s t industries such as a u to m o b ile m a n u f a c ­ turing or fashion retailing, p ro d u cers can limit their initial in ve stm e nt in a w holly new c o n c c p t by p ro du cin g and test m arketing a prototype. If the test m ark etin g sh o w s the new p ro d u ct is likely to be po pu lar, the c o m p a n y can give the goahead to its m a n u fac tu rin g o p eratio ns and in crease its investm ent. If the test m a r ­ ket sho w s the p ro d u c t prob ably will fail, the m a n u fa c tu re r limits its losses by can celin g prod uctio n plans. S u ch risk-lim itation strategies are m uch less possible for m ed ia co m p a n ie s (Priest, 1994). A bo ok p u b lish e r has to buy the rights to a book, pay the author, go through the editing process, and print at least a limited run o f co pies b efore it can j u d g e how well the b o o k sells. A film studio has to in vest a lm o st the full cost o f p ro d u cin g a film b efore it has any thin g to sh ow to test audiences. At that point, op tio ns for ch an g e are limited. T h e studio m ay be able to re-shoot and edit a sad end in g into a h app y en din g in respo nse to test-au dien ce feed back , but if the au d ie n c e rejects the entire film, prod uctio n costs have already been in ­ curred and the in v es tm e n t is a loss. S e q u els and spin-offs are the m ed ia in d u s try ’s resp on se to this d ile m m a o f p ro du ct-differe ntia tion risk. If the first film o r T V series w as successful, the se­ quel is alm ost g u ara nte ed to have a built-in fan base e ven if its potential a ud ien ce is sm aller. A n entirely new film or T V series runs the risk o f hav in g virtually no au d ie n c e at all. T alen t such as su ccessful w riters, directors, and p erfo rm e rs w ho already are p o p u la r w ith a ud ienc es also help s redu ce risk. T h ese realities o f in­ form a tion e c o n o m ic s m a k e m e d ia co m p a n ie s reluctant to in vest in new talent, new storylines, an d a van t-garde pro du ction ap proac hes. T h is rcduccs the prod uct d ifferentiation o r ch oicc a vailab le to c o n s u m e rs and is a b arrier to entry to th ose trying to b reak into the industry. W h e n m e d ia co m p a n ie s offe r too little p ro d u c t differentiation, failure follows. In 1999, m o st o f the g am e -sh o w spin-offs o f “ M illio n a ire ” w ere ratings failures and w ere can celled by their n etw o rk s at the end o f the fall season. A u d ien ce s m ig ht have loved w atc h in g a g a m e show one nig ht a w eek , b ut they app aren tly w ere not en thusiastic ab ou t hav ing a p rim etim e sch ed ule full o f them . M e d ia m ark et a n a ly s ts ’ difficult ch allen ge is m a x im izin g pro d u ct d iffere n tia­ tion w hile m in im izin g risk. O n e strategy increasingly used in the m ed ia industry is to look for pro d u cts or c o n cep ts that w ere su ccessful in lim ited g e og rap hic m arkets and then introduce version s o f them into new areas. In the early 1980s, the c o n c e p t o f local w e ek ly bu sin ess n ew sp a p e rs w as laun ch ed in a few M id w e s t cities to prov id e local b usin esse s with in-depth co v era g e o f their m arkets. The c o n cep t w as im m ed ia te ly successful. By the end o f the d eca d e , such pap ers were

198

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f o u n d in large and m i d -s i z e cities a c ro s s the U n ite d S ta te s an d a r o u n d the w o rld . S im ila rly , “ M i ll io n a i r e ” o rig in a lly w a s a B ritish p r o g r a m , but by 2 0 0 1 , v e rs io n s o f it w e re b e in g s h o w n in at least 64 c o u n tr ie s a r o u n d the w o rld. B ra n d id e n tific a tio n is a n o th e r im p o r t a n t a s p e c t o f p r o d u c t d if fe re n tia tio n to c o n s i d e r in m a r k e t a n a ly s is (A a k e r, 1995). C o n s u m e r s te n d to d e v e lo p b ran d lo y a lty o v e r tim e so h a v in g a re c o g n i z a b le b ra n d is an a d v a n ta g e , p a rtic u la rly a g a in s t n ew m a r k e t c o m p e t it o rs . B ra n d id en tifica tio n h a s long b e e n a m a j o r m a r ­ k e tin g fo c u s fo r c o n s u m e r p r o d u c t m a n a g e rs . O n ly in the m i d - 1 9 9 0 s did m e d i a m a n a g e r s b e g in tryin g to d e v e lo p c le a r b ra n d id en tities fo r th e ir statio n s, n e t ­ w o rk s , and p u b li c a ti o n s to d if fe re n tia te th e ir p r o d u c t s (J a c o b s & K le in , 2 0 0 2 ). C o s t S tr u c tu re s .

C o s t s tru c tu r e s are the total p ro d u c t io n c o sts in a p a rtic u la r

m a r k e t an d in c lu d e b o th fixed an d v a ria b le c o sts. T h e im p o r t a n c e o f fixed co sts h a s b e en a d d re s s e d . H o w e v e r , fo r m e d i a c o m p a n i e s , p e rs o n n e l co sts are g e n e r ­ ally o n e o f the la r g e s t b u d g e t lines. In l a r g e - m a r k e t T V statio ns, c o m p e n s a ti o n c o sts are a r o u n d 4 0 % o f total e x p e n d it u r e s a n d as m u c h as 5 0 % fo r s m a ll - m a r k e t s ta tio n s (N a tio n a l A s s o c i a tio n o f B r o a d c a s t e rs , 2 0 0 1 ). P e rs o n n e l are a v a ria b le c o s t to s o m e d e g re e b e c a u s e m e d i a c o m p a n i e s h a v e at least s o m e c o n tr o l o v e r the n u m b e r o f p e o p le th ey hire. Y e t th e m e d i a in d u s try is p e r s o n n e l d e p e n d e n t . In f o r m a t io n a n d e n te r ta i n m e n t p ro d u c t s are c re a tiv e p ro d u c ts . T h e i r q u a lity and a p p e a l d e p e n d on the ta len ts an d cre a tiv ity o f the p e o p le w h o d e v e lo p th e m . M e d i a c o m p a n i e s m a y opt to hire e m p l o y e e s at the lo w e s t co sts p o s s ib le , b ut it is likely to a ffect p r o d u c t q u a lity an d s u c c e s s . A d d i ­ tio n a lly , if o n e c o m p e t i t o r p a y s its e m p l o y e e s at b e l o w - m a r k e t le vels, it is likely to lo se its e m p l o y e e talen t to c o m p e t it o r s . C o n s e q u e n t l y , o n e o f the im p o rta n t v a ria b le s a m e d i a - m a r k e t a n a ly s is m u s t in c lu d e is an e x a m i n a ti o n o f the a v a il­ ability an d c o st o f the p e r s o n n e l n e e d e d to s u c c e e d in a g iv e n m a rk e t. V e r tic a l In te g ra tio n .

V ertic a l in te g ra tio n is w h e n a c o m p a n y o w n s th e c o m ­

p a n ie s th a t it b u y s its in p u ts fro m or th o se to w h ic h it sells its final p ro d u c ts . In the m e d i a in d u s try , a n e w s p a p e r c o m p a n y th a t also o w n s a n e w s p r i n t m a n u f a c ­ tu rin g c o m p a n y is an e x a m p l e o f v e rtic a l in te g ra tio n . S im ila rly , a c a b le m u ltip le sy s te m o p e r a t o r ( M S O ) h a v in g o w n e r s h i p s ta k e s in v a rio u s c a b le n e tw o r k s is v e rtica lly in te g ra te d . V e rtic a l in te g ra tio n is a form o f m a r k e t p o w e r. It is d ifficu lt fo r n ew c o m p e t i ­ tors to e n te r m a r k e ts w h e re e x is tin g se llers are h ig h ly v e rtically in te g ra te d . H a v ­ ing a c c e s s to d is trib u tio n c h a n n e l s is n e c e s s a ry f o r any p r o d u c t to su c c e e d (P e a r c e & R o b in s o n , 1997). In m e d i a in d u s trie s, ve rtic al in te g ra tio n a ll o w s s o m e c o n te n t c r e a t o rs to g e t a c c e s s to m e d i a d is trib u tio n c h a n n e l s w h ile c lo s in g o th ers o u t o f the m a r k e t. F o r e x a m p l e , in 1995, th e F in a n c ia l S y n d ic a t io n ru le s p r e v e n t ­ ing b ro a d c a s t T V n e tw o r k s fro m o w n i n g the p r i m e t im e p r o g r a m m i n g th ey aired w e re e li m i n a te d . In the a b s e n c e o f the F in - S y n ru les, m a n y n e tw o r k s n o w fill th e ir p r i m e t im e s c h e d u l e s w ith series m a d e by th e ir o w n stu d io s. T h a t m a k e s it

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199

h a r d e r f o r in d e p e n d e n t p r o d u c e r s to s u r v iv e in the p ri m e t im e e n te r ta i n m e n t m a r ­ ket. S im ila rly , m o r e c a b le n e tw o r k s c o m p e t e fo r c a rr ia g e on lo cal c a b le s y s te m s th an th e re are c h a n n e l s a v a ila b le . T h e n e tw o r k s th a t are at least p a rtly o w n e d by the m a j o r M S O s h a v e a m u c h b e tte r c h a n c e o f b ein g p ic k e d up th an i n d e p e n d e n t n e tw o rk s . A c a b le n e tw o r k n ot g iv e n c a rr ia g e by M S O s o r satellite T V se rv ic e p ro v i d e rs h as no a c c e s s to d is trib u tio n c h a n n e l s an d th u s no w a y to reach its m a rk e t. A c c e s s to D i s t r i b u t i o n C h a n n e l s : E x i s t i n g T e c h n o l o g i e s .

A n o t h e r c le m e n t

o f a n a ly z in g a c c e s s to d is trib u tio n c h a n n e l s is e x a m i n i n g te c h n o l o g ie s o f m a r k e t p ro d u c t io n and d is trib u tio n . A m a r k e t a n a ly s is s h o u l d e x a m i n e the n a tu re , q u a l ­ ity, an d lo ca tio n o f the te c h n o l o g ie s b e in g used. T h e an a ly s is o f a local m e d i a m a r k e t m i g h t in c lu d e in f o rm a t io n a b o u t w h e t h e r the n e w s p a p e r o w n e d its o w n p re s s o r c o n tr a c te d its p rin tin g to a n o th e r c o m p a n y ; the ty p e o f p ress u se d ; the p r e s s ’ c a p a c i ty in te r m s o f v o lu m e , co lo r, an d r e p r o d u c ti o n q u a lity ; h o w o ld it w a s; an d w h e n it w o u ld n e e d to b e re p la c e d . F o r b r o a d c a s t statio n s, te c h n o l o g y is su es c e n te r a ro u n d b a n d , dial, an d c h a n n e l p o sitio n ; p o w e r o f the tr a n sm itte r; and h e ig h t and lo catio n o f its to w er. In ra d io , an A M s t a ti o n ’s s ig n al g e n e ra lly tra v e ls fa r th e r th a n an F M s t a ti o n ’s sig n al, w h ic h tra v e ls line o f sight. Y e t the s o u n d q u a lity o f an A M sig n al is less. A h ig h - p o w e r e d A M statio n m a y be h e a rd o v e r h u n d r e d s or e v e n th o u s a n d s o f m iles at n ig h t, b ut a w e a k e r F M sta tion is a b e tte r s o u r c e fo r liste n in g to m u s ic . L ik e w is e a ra d io station th a t h as a lice nse fo r a dial p o sitio n in the m i d d le o f the s p e c t r u m is m o r e lik ely to be fo u n d by listen ers s c a n n i n g the b an d th an o n e w ith a lic e n se fo r a dial p o sitio n at the e n d o f th e b a n d . In c o n tr a s t, c a b le n e tw o rk s th a t are in the b asic tier or l o w e r n u m b e r e d c h a n n e l s are m o r e lik ely to be seen by v ie w e r s w h o are su rfin g w ith the r e m o te th an th o s e p la c e d o n h ig h - n u m b e r e d c h a n n e l s s u c h as the 80s o r 100s. T h e p o w e r o f b r o a d c a s t s t a t i o n s ’ tr a n s m itte rs is also an is sue. R a d io sta tion s w ith lic e n se s fo r h ig h - w a t ta g e tr a n s m itte rs h a v e a la r g e r p o te n tia l a u d ie n c e than th o s e w ith l o w - w a tt a g c tr a n s m itte rs b c c a u s c the m o r e p o w e r f u l tr a n sm itte rs reach la r g e r areas. W h e r e a g re a t d e a l o f d if fe re n c e in the p o w e r o f tw o station s exists, it is u n lik e ly the station w ith the w e a k e r tr a n s m i tt e r will h a v e h i g h e r ra t­ in g s than the m o r e p o w e r f u l station b e c a u s e o f the s m a ll e r size o f its p o te n tial a u d ie n c e . T o w e r h e ig h t a n d lo catio n are im p o r t a n t fo r FM sta tio n s, b u t less so fo r A M statio n s. B e c a u s e F M sig n als travel line o f sig h t, if tw o F M s ta tio n s hav e tr a n s m itte rs o f the s a m e p o w e r , b u t o n e has a taller t o w e r o r b u ilt its t o w e r on a hill, its s ig n al w ill reach farther. T o w e r location, p o w e r, and w h e th e r a station is lic ensed for V H F o r U H F tr a n s­ m issio n are also im p o rta n t for b ro a d c a s t T V stations. T h e s e issues o f signal reach are b e c o m i n g less im p o r t a n t b e c a u s e m o r e th an 6 0 % o f the U .S . a u d ie n c e r e ­ c e iv e s T V th r o u g h c a b le o r satellite p ro v id e rs . W h a t is i m p o r t a n t is th e c a p a c ity and su b s c rip tio n rate o f the lo c al c a b le sy s te m , p a rtic u la rly f o r U H F station s.

200

CHAP T E R 8

A lso o f in c r e a s in g i m p o r t a n c e is the a d o p tio n rate fo r h ig h - d e fin itio n T V sets a m o n g area c o n s u m e r s and w h e t h e r the local c a b le sy stem c a n c a rr y th e H D T V s ig n a ls s ta tio n s are r e q u i re d to b ro a d c a s t. If the T V s ta tio n is b ro a d c a s ti n g H D T V , but the lo cal c a b le sy s te m is n o t c a rr y in g the sig nal, the T V statio n loses a c c e s s to the d is trib u tio n c h a n n e l to a b o u t 6 0 % o f its m a rk e t. L ik e w is e , if the station is b r o a d c a s ti n g in H D T V , b ut c o n s u m e r s fail to b u y the sets, the station is cut o f f fro m its d is trib u tio n ch a n n e l. T h e te c h n o l o g y q u e s t io n s in a m a r k e t a n a ly s is f o r c a b le c o m p a n i e s in c lu d e c h a n n e l c a p a c ity , h o m e s p a s s e d , and dig ital c a p a c ity . C a b le o p e r a t io n s re q u ire m a j o r c a p ita l in v e s tm e n ts . W h e n a lo c al s y s te m r e a c h e s its c h a n n e l c a p a c ity , it m a y re q u ire a s ig n ific a n t in v e s t m e n t to e x p a n d the n u m b e r o f c h a n n e l s o ff e re d to c o m p e t e w ith satellite T V p ro v id e rs . A n y n e w , i m p o r t a n t t e c h n o l o g ic a l d e v e l o p ­ m e n t, s u c h as the in tro d u c tio n o f d igital, can fo rce c a b le s y s te m s to u n d e rt a k e an e x p e n s i v e re c o n s tr u c t io n o f th e ir in fra stru c tu re . T h e n u m b e r o f h o m e s p a s s e d , a m e a s u r e o f the c a b le s y s t e m ’s p o te n tia l m a r k e t, is im p o r t a n t b e c a u s e a sy s te m c a n n o t o ff e r se rv ic e to s o m e o n e w h o s e h o m e is n o t p a s s e d by its in fra stru c tu re . S o a m a r k e t a n a ly s is c o m p a r e s the n u m b e r o f h o m e s th e c a b le s e r v ic e p ro v i d e r p a ss e s an d the n u m b e r o f h o u s e h o l d s in the m a rk e t. N e w m e d i a c o m p a n i e s are p a rtic u la rly d e p e n d e n t on te c h n o l o g y fo r d is tr i b u ­ tion. In the late 199 0s, a n u m b e r o f p ro m is i n g dig ital c o m p a n i e s failed b e c a u s e th e ir p r o d u c t s re q u ire d b r o a d b a n d d is trib u tio n , an d th e r o llo u t o f b r o a d b a n d I n ­ tern et a c c e s s in th e U n ite d S tates w a s m u c h s l o w e r th an e x p e c t e d . T h e m a r k e t for o n lin e p r o d u c t s d e p e n d s w h o lly on the d e g re e to w h ic h the ta rg et m a r k e t a u d ie n c e a d o p ts c o m p u t e r and o n lin e te c h n o l o g ie s . F o r su ch p ro d u c t s as V id e o o n - D e m a n d o r g ra p h i c - i n te n s i v e in te ra c tiv e m u l ti m e d i a g a m e s , b r o a d b a n d is r e ­ q u ir e d fo r effe c tiv e d is trib u tio n . T h e c o sts o f b ro a d b a n d se rv ic e s r e m a in hig h , an d U .S . c o n s u m e r a d o p ti o n h a s b e e n slo w . T e c h n o lo g i c a l lim ita tio n s m a k e b r o a d b a n d se r v ic e s difficu lt to a c c e s s in larg e a re a s o f th e c o u n try . W h e r e an o n lin e p r o d u c t is d e s i g n e d fo r a g lo b a l m a r k e t, re g io n a l an d n a ­ ti on al d i f fe re n c e s in t e c h n o l o g y a d o p ti o n arc in c lu d e d in the m a r k e t an aly s is. S c a n d in a v i a n c o u n tr ie s h a v e the h ig h e s t lev els o f in d iv id u a l a d o p ti o n o f o n lin e te c h n o l o g ie s in the w o rld , m a k i n g th em a g o o d m a r k e t fo r o n lin e m e d i a p r o d ­ ucts. A d o p tio n lev els in S o u th A m e r i c a an d A fri c a are m u c h lo w er. S u c h t e c h n o ­ log ica l an d s o c i o lo g i c a l is su es d e m o n s tr a t e w h y a m a r k e t a n a ly s is a d d re s s e s w h e t h e r a c c e s s to the n e c e s s a ry d is trib u tio n c h a n n e l s is av a ila b le so the m e d i a p r o d u c t can actu a lly r e a c h a u d ie n c e s a n d a d v e rtise rs. T h e Target M a rket.

A m a r k e t a n a ly s is m u s t in c lu d e an a n a ly s is o f the ta r ­

g et m a r k e t. F o r m e d i a c o m p a n i e s , not all a u d ie n c e s are c r e a te d e q u al. S o m e ty p e s o f a u d ie n c e s are m o r e d e s ira b le to a d v e rtis e rs th a n o th e r s , w h ic h m e a n s th at th ey are also m o r e d e s ira b le as targ et m a r k e ts fo r m e d i a c o m p a n i e s . F o r e x ­ a m p l e , 18 to 4 9 -y e a r - o ld w o m e n are the m o s t d e s i ra b le targ et m a r k e t b e c a u s e

M ARKE T ANALYSI S

201

th e y te n d to m a k e m o s t h o u s e h o l d b u y in g d e c is io n s. T h e y h av e m o r e i n c o m e to s p e n d an d a p p e a r w illin g to e x p e r i m e n t w ith n ew p r o d u c t s or bran d s. C ritic s say the fo c u s on p r o v id in g c o n te n t p ri m a ri ly for the d e m o g r a p h ic g r o u p s a d v e rtis e rs p re f e r m e a n s that larg e p o p u la t io n s e g m e n ts are n o t s e r v e d by m e d ia . M e d i a c o m p a n i e s la rg ely ig n o r e d e th n ic m in o ritie s o v e r the y e a r s b e ­ c a u s e re lativ ely few a d v e rtis e rs s p ec ific ally ta r g e te d th em as p o te n tia l c u s t o m e rs . T h a t h a s c h a n g e d re c e n tly as c a b le n e tw o r k s d e s i g n e d for specific e th n ic g r o u p s w e re la u n c h e d , an d S p a n is h - la n g u a g c T V an d ra d io is o n e o f the fa s te st g ro w in g f o r m a ts in the U n ite d States. A s m e d i a c o m p e t it io n in c r e a s e d , m e d i a c o m p a n i e s sta rte d n a r r o w c a s t in g or t a r g e tin g a u d ie n c e g r o u p s m o r e a n d m o r e n a rr o w l y . T h e F o x n e tw o r k e m p h a ­ size d p r o g r a m m i n g fo r y o u n g e r v ie w e rs . T h e m a s s - a u d i e n c e b r o a d c a s t an d c a b le n e tw o r k s b e g a n o ff e rin g m o r e p r o g r a m m i n g ta rg e te d to e th n ic m in o ritie s. C a b le n e tw o r k s targ e tin g p e o p le w ith d is a b ilitie s started to a p p e a r. S o m e m e d i a su ch as ra d io are c a lle d lifestyle m e d ia b e c a u s e th eir c o n te n t c lo s e ly re lates to the life sty les o f the a u d ie n c e th e y attract. U rb a n rad io attracts an e th n ic a lly d iv e r s e , y o u n g e r , u rb a n listener, w h e r e a s O ld ie s d r a w s the s u b u r ­ ban B a b y B o o m g e n e ra t io n . S e le c t in g a rad io fo r m a t is, in e ffec t, sele c tin g a ta r g e t a u d ie n c e , w h ic h

h as d ir e c t c o n s e q u e n c e s

fo r the s t a ti o n ’s p o te n tia l

ra tin g s an d r e v e n u e s . N e w s p a p e r m a n a g e r s an d a d v e rtis e rs k n o w th e d e m o ­ g ra p h ic an d p s y c h o g r a p h ic profiles o f b u s in e s s p a g e r e a d e r s d if fe r fr o m the profiles o f lifestyle se ctio n re a d e rs. A d v e rti s e rs b uy s p a c e in th o se sec tio n s ac c o rd in g ly . A d v e rtis e rs b u y m e d ia targ etin g a n a rro w d e m o g r a p h ic to k n o w e x a c tly the a u d ie n c e s th ey rea ch an d m o s t are p o ten tial c u s to m e rs . T h e a d v e rtis e r w illin g ly p a y s a h ig h e r a d v e rtisin g rate for a c o m p a r a ti v e ly s m a lle r a u d ie n c e . W h e n a d v e r ­ tisers b u y tim e o r s p a c e in daily n e w s p a p e r s an d b r o a d c a s t n e tw o rk s targ e tin g a m ass a u d ie n c e , they k n o w th ey are re a c h in g a la rg er a u d ie n c e w ith m a n y p e o p le w h o arc n ot p ote ntia l c u s to m e rs . S p e c ia liz e d m e d ia also m a y attract a d v ertise rs that m ass m e d ia can n o t. B u s in e s s n e w s p a p e rs sell s p a c e to b u s in e s s - to -b u s in c s s ad v ertise rs, such as office e q u i p m e n t an d furnitu re c o m p a n i e s th at arc u n lik e ly to b u y m u c h s p a ce in the m a s s m ed ia. T h e ta r g e t a u d ie n c e is a n a ly z e d in a m a r k e t a n a ly s is to id e n tify the a u d ie n c e an d a d v e rtis e rs that e x is tin g m e d i a c o m p a n i e s p u rs u e . O th e r a v a ila b le or u n d e r ­ se r v e d a u d ie n c e s in the m a r k e t are e x a m i n e d to c o n s i d e r w h e t h e r a d v e rtise rs ex is t to rea ch th o s e g ro u p s . A c a re fu l targ et m a r k e t a n a ly s is e x a m i n e s p o te n tial ad v e rtis e rs in the m a r k e t that are u n lik e ly to b u y a d v e rt is i n g in a m a s s - a u d i e n c e m e d i u m b e c a u s e th ey m a y be an u n ta p p e d b u s i n e s s o p p o rtu n ity . E c o n o m i c a n d S o c io l o g ic a l C o n d itio n s.

T h e final elem en ts to include in an

analysis o f external m a rk e t c o nd itio ns are the e c o n o m ic and so ciolog ical co nd ition s in the g e o g r a p h i c area. T h e key e c o n o m i c e le m e n ts in c lu d e the u n e m p l o y m e n t

202

CHAP T E R 8

rate, h o w it c o m p a r e s to state an d n atio n a l a v e ra g e s , th e lo n g - te rm g r o w th tre n d s in area, and the d iv e r s ity o f b u s in e s s and in d u s try in th e e c o n o m y . A m a r k e t h a v in g a h ig h e r than a v e r a g e u n e m p l o y m e n t rate is o f c o n c e r n fo r a m a r k e t an aly st, p a rtic u la rly if the rate r e p r e s e n ts a lo n g - te rm tren d an d n o t j u s t a te m p o r a r y in c re a se . H ig h u n e m p l o y m e n t m e a n s p e o p le in the m a r k e t h a v e less d is p o s a b le in c o m e . A city o r reg io n th a t is n o t g r o w in g is less d e s ira b le b e c a u s e a lack o f lo cal e c o n o m i c g r o w th m a k e s it h a r d e r to in c re a se the m e d ia c o m ­ p a n y ’s r e v e n u e s an d v alu e. A n area h e a v ily d o m i n a t e d by a sin gle in d u s try is also less d e s ira b le b e c a u s e a d o w n t u r n in th at in d u s try ca n le ad to a sh arp e c o ­ n o m i c d e c lin e . O f g re a t e r c o n c e r n is an a re a w h e re a s in g le c o m p a n y p ro v i d e s m o s t o f the jo b s . T h e loss o f tha t c o m p a n y w o u ld b e d e v a s ta tin g . D e m o g r a p h i c s an d p s y c h o g r a p h i c s are the so c io lo g ic a l e le m e n ts a m e d i a m a r k e t a n a ly s t e x a m i n e s . D e m o g r a p h i c s de fin e targ et m a r k e ts a n d d e s c r ib e p e o ­ ple in te r m s o f ag e, race, g e n d e r, e d u c a t io n level, an d i n c o m e . P s y c h o g r a p h ic s d e s c r ib e life style, c u ltu re , an d v a lu e s . D e m o g r a p h i c fa c to rs are im p o rt a n t to a d v e rtis e rs so u n d e r s ta n d in g m a r k e t d e m o g r a p h i c s is c ru c ia l for m a r k e t a n a ­ lysts. P s y c h o g r a p h ic s are im p o r t a n t too b e c a u s e a to w n d o m i n a t e d by a p o li ti­ cally c o n s e r v a ti v e p o p u la t io n

is f u n d a m e n ta l ly d if fe re n t fro m

a po litic ally

liberal to w n . A m a r k e t w ith a large, a fflu ent p o p u la t io n o f c o rp o r a te e x e c u t iv e s h a s d if fe re n t m e d i a n e e d s a nd tastes th an a c o m m u n i t y o f farm fam ilie s. U n d e r ­ s ta n d in g

s u c h d if fe re n c e s

is critical to m a k i n g

su c c e s s fu l d e c is io n s a b o u t

c o n te n t. C o n te n t th at s u c c e e d s in B e rk e le y , C a li fo rn i a , m a y n ot be p o p u l a r in A lb a n y , G e o rg ia . I n t e r n a l C o n d it io n s .

E x a m i n i n g in te rn a l c o n d it io n s is a s e l f - e x a m in a t io n

p r o c e s s fo r a firm to d e te r m i n e w h e th e r it h as the in te rn a l r e s o u rc e s n e e d e d to in ­ ve st in an d l a u n c h a n e w p r o d u c t o r m o v e into a n e w m a r k e t su c c e s s fu lly . O n e te c h n i q u e fo r a n a ly z in g in te rn a l c o n d it io n s is the S W O T an a ly s is, w h ic h sta n d s fo r S tr e n g th s , W e a k n e s s e s , O p p o r tu n i ti e s , a n d T h r e a t s (P e a r c e & R o b in s o n , 1997). A S W O T a n a ly s is e x a m i n e s the c o m p a n y ’s m is s io n s t a te m e n ts , g o a ls , o r ­ g a n iz a tio n a l stru c tu re , le a d e rs h ip , p e r s o n n e l an d finan cial re s o u rc e s , o r g a n i z a ­ tio n al an d p r o f e s s i o n a l c u lt u re s , an d e x is tin g p r o d u c t m ix and m ark e ts. In a S W O T a n a ly s is , the a n a ly s t a sk s w h e t h e r the p r o p o s e d i n v e s tm e n t is c o n ­ siste n t w ith a fi r m ’s m issio n s ta te m e n t an d g o a ls . H o w will th e n e w v e n tu r e fit in to the c u rr e n t o r g a n i z a ti o n a l stru c tu r e ? Is the n ew m a r k e t g e o g r a p h i c a ll y p r o x ­ im a te, o r d o e s ta k i n g on the n e w b u s i n e s s c rea te the n e e d fo r n ew o ffice s p a c e or c o m m u n i c a t i o n and m a n a g e m e n t in f ra s tru c tu re ? C a n the c o m p a n y ’s le a d e rsh ip a s s u m e the a d d e d re s p o n s ib ilitie s o r are th ey a lr e a d y m a n a g i n g all they can h a n d le ? D o th ey h a v e the e x p e r t is e to h a n d le this line o f b u s i n e s s o r m a r k e t? If no t, is it p o s s ib le to hire th at e x p e rt is e ? H o w d o e s th e n e w p r o d u c t fit into the ex is tin g p r o d u c t m i x ? R u n n in g a m e d i a c o m p a n y d o e s n o t m e a n th at c o m p a n y w ill su c c e e d in ru n n i n g a retail o p e ra tio n , su c h as a m e d i a firm l a u n c h i n g retail sales u sin g E - c o m m e r c e o p e r a t io n s on its W e b site.

M ARKE T ANALYSI S

203

A critical q u e s tio n is w h e th e r th e c o m p a n y h as the finan cial r e s o u rc e s to m a k e the i n v e s tm e n t an d su stain it as long as n e c e s s a ry to b e c o m e profitable. L e ss o b v io u s is w h e th e r the n ew p ro j e c t is a g o o d m ix w ith th e c o m p a n y ’s e x i s t ­ ing o rg a n i z a ti o n a l a n d p r o f e s s i o n a l cu ltu re s. D iff e re n t ty p e s o f p ro f e s s i o n s and o rg a n i z a ti o n s h a v e d if fe re n t c u ltu res. C u lt u r e c la s h e s are a m a j o r s o u r c e o f o r g a ­ n iz a tio n a l te n s io n and often cited in failed c o rp o r a te m e r g e rs . F o l l o w i n g the A O L an d T im e W a r n e r m e r g e r, th ere w a s o p e n co n flict b e tw e e n A O L e x e c u ­ tiv es, w h o

o p e ra t e d

o u t o f a c e n tr a li z e d , fa s t- m o v in g ,

in te ra c tiv e c u ltu re ,

a n d T im e W a r n e r e x e c u t iv e s , w h o w o r k e d a u t o n o m o u s l y , e a c h r u n n i n g a d i v i ­ sion w ith little in p u t fr o m o th e r s ( M u n k , 2 0 0 2 ). C u lt u ra l c la s h e s also e x is t b e ­ tw e e n tw o c o m p a n i e s in the s a m e b u s i n e s s h a v in g d if fe re n t p ro d u c ts . A rad io station w ith a h ip - h o p fo r m a t h a s a d if fe re n t in tern a l c u ltu re than o n e w ith a c l a s ­ sical m u s ic fo r m a t. T h e s e d i f fe re n c e s n e e d to b e e x a m i n e d , u n d e rs to o d , and m anaged. T h e c o m p a n y ’s p o s itio n in its e x is tin g m a r k e ts is also a c a re f u lly e x a m i n e d internal c o n d itio n . Is it in a s tro n g p o sitio n ? Is it a m a r k e t le a d e r? Is it facing se ri­ o u s c o m p e t it iv e th reats o r an e r o d i n g m a r k e t? If th e c o m p a n y is in a s tro n g p o s i ­ tion, then it is p r o b a b l y a g o o d tim e to m a k e n e w in v e s tm e n ts . In v e s tin g m ig h t be m o r e difficu lt if th e firm faces s e r io u s c o m p e t it iv e th rea ts in its e x is tin g m a r ­ kets. Y e t if the c o m p a n y ’s b u s i n e s s is e ro d i n g , it m a y b e difficult b u t a d v a n t a ­ g e o u s to m o v e in to n e w p ro d u c t s w ith a b e tte r lo n g - te rm future. O n c e data are g a th e r e d on in tern al c o n d it io n s , the a n a ly s t u ses th e m to view th e c o m p a n y ’s stre n g th s and w e a k n e s s e s in relatio n to th e p r o p o s e d n ew project. A stre n g th in o n e set o f c i r c u m s t a n c e s m a y b e c o m e a w e a k n e s s if c o n d it io n s c h a n g e and vice v ersa. A so p h is tic a te d a n a ly s is c o n s i d e r s h o w the c o m p a n y w o u ld p e rf o rm u n d e r d if fe re n t sc e n a r io s if th e p ro je c t g o e s f o r w a r d , as w e ll as w h a t n e w o p p o rt u n it ie s o r threats the in v e s t m e n t offers. M o s t p ro je c ts p ro v i d e b o th o p p o rt u n it ie s an d th re a ts to e x a m i n e c a re f u lly a n d h o n e stly . F in a lly , the an a ly s is o f in tern a l c o n d it io n s m u s t a c c o u n t fo r the p r o p o s e d p r o ­ j e c t ’s e ff e c t on the in v e s t m e n t m a r k e t (A a k e r, 1995). M a n a g e m e n t m u s t c o n s i d e r h o w the i n v e s t m e n t o r n ew p r o d u c t c o u ld a ff e c t the c o m p a n y ’s sh o rt- and l o n g ­ te rm finan cial p e r f o r m a n c e b e c a u s e it a ffe c ts the c o m p a n y ’s v a lu e to o w n e r s and in v e s to rs . A d r o p in a p u b li c ly h e ld c o m p a n y ’s stock p rice b rin g s its to p e x e c u ­ tive u n d e r fire from m a j o r s to c k h o ld e r s a n d financial an a ly s ts. O w n e r s o f priv ate firm s also e x p e c t th e v a lu e o f th e ir h o ld i n g s to g ro w o v e r the lo n g term . F in a n c ia l C onditions.

T h e final m a r k e t a n a ly s is e le m e n t to e s t im a te is the

financial c o sts an d re tu rn s re s u ltin g from the p ro j e c t o r in v e s tm e n t. T h e r e v e n u e s to fo re c a st in clu d e: (a) th o s e g e n e r a t e d by the new p ro je c t, (b) the e x p e c t e d lo n g ­ te rm R O I o r re tu rn on in v e s tm e n t, (c) the c a p ita l a v a il a b le to finan ce it, a n d (d) p o s s ib le in ta n g ib le bene fits to the c o m p a n y . I f p u r c h a s in g an e x is tin g p ro p e r ty , d a ta are a v a ila b le to h e lp e stim a te r e v e n u e s an d c o sts b a s e d on p r e v i o u s p e r f o r ­ m a n c e . If a m e d i a c o m p a n y is c o n s i d e r in g s o m e th i n g like a n e w b u s in e s s

204

CHAP T E R 8

s ta rt-u p , f o r m a t c h a n g e , or b u y o u t o f a n o t h e r c o m p a n y , r e v e n u e and c o s t data m a y be u n a v a il a b le or a p o o r g u id e to the fu tu re. A n a n a ly s t e x a m i n e s c u r r e n t a n d fu ture c o sts to fo r e c a s t h o w long it ta k e s for the fi rm ’s r e v e n u e s to e x c e e d co sts o r to pro fit fro m the i n v e s tm e n t or p ro d u c t. P la n n e d o p e r a t io n a l c h a n g e s , the i n v e s tm e n t th o s e c h a n g e s re q u ire , a n d c u rre n t an d fu tu re m a r k e t e c o n o m i c s are c o n s i d e r e d to e s t im a te w h e n the b r e a k e v e n p o in t s h o u ld b e re a c h e d . E x e c u ti v e s m u s t e n s u r e the firm can sustain lo sses long e n o u g h fo r the n e w o p e ra tio n to e s ta b lis h itself. A ll too often c o m p a n i e s arc fo r c e d to a b a n d o n p r o m is i n g p ro je c ts b c c a u s c th ey la ck the fin a n c e s to sustain th e m until the m a r k e t d e v e lo p s . R e tu rn o n i n v e s tm e n t (R O I ) m e a s u r e s h o w m u c h pro fit an o w n e r m a k e s relativ e to the a m o u n t o f in v e s t m e n t r e q u i re d to m a k e th a t re tu rn . F ir m s seek th e h ig h e s t retu rn on i n v e s tm e n t p o ss ib le . W h e n a c o m p a n y c o m p a r e s tw o com peting

i n v e s tm e n t

o p ti o n s ,

it

u su a lly

in v e s ts

in

the

one

h a v in g

the

h ig h e s t R O I p o te n tia l. A g o o d i n v e s tm e n t d e c is io n re q u ire s an e s t im a te o f the likely R O I. If the p ro j e c t re q u ire s a su b s ta n tia l in v e s tm e n t, the av a ila b ility an d co st o f fin a n c in g m u s t be e x a m i n e d . F ir m s u s u a lly fin an ce in v e s tm e n ts in th ree w a y s : re v e n u e , b o r r o w i n g , o r e x p a n d i n g o w n e r s h i p . A ll three m e t h o d s h a v e risks. W h e n u sin g re v e n u e , a firm p a y s fo r the p ro j e c t o u t o f the m o n e y it g e n e ra t e s fro m e x is tin g b u sin e ss. T h is r e d u c e s profits at least t e m p o r a r ily an d can p u t p r e s ­ su re on a p u b lic ly held c o m p a n y ’s sto ck p rice. B o r r o w in g in v o lv e s ta k in g on d e b t and is u s u a lly u se d f o r lo n g - te rm in v e s tm e n ts . B o r r o w e d m o n e y m u s t be r e ­ pa id w ith in terest, w h ic h is the c o s t o f fin a n c in g . C a r e f u l atte n tio n is p a id w h e n ta k in g o ut lo an s b e c a u s e fin a n c in g co sts m u s t be pa id o u t o f r e v e n u e s . T h e c o m ­ p a n y w ill fail if the c o m b i n a ti o n o f o p e ra tin g c o sts a n d d e b t serv ice e x c e e d the c o m p a n y ’s r e v e n u e s o v e r a lo ng p e ri o d o f ti m e. E x p a n d i n g o w n e r s h i p is a w a y to fin an ce a c o m p a n y b y b r in g in g in in ve stors. M u ltip le in v e s to rs can in c r e a se the c o sts an d c o m p l e x it y o f c o r p o r a te d e c is io n s by n e c e s s ita tin g n e g o tia tio n a m o n g the o w n e r s o r b a ttles fo r c o rp o r a te c o n tro l. If the c o m p a n y sells sto c k p u b lic ly , it f a c e s a h o st o f n e w state an d fe d e ra l s e c u r i ­ ties r e g u l a ti o n s to c o m p l y w ith an d in c r e a s in g o p e ra t in g co sts. M a n a g e m e n t face n e w p r e s s u re s to c o n ti n u o u s l y m a x i m i z e s h a r e h o ld e r v a lu e th r o u g h the stock p ric e, a f f e c tin g the r a n g e o f fu tu re o p ti o n s fo r the c o m p a n y . T h e in ta n g ib le e le m e n ts o f a fin ancial a n a ly s is are e v e n m o r e difficu lt to e v a l ­ uate and c a lc u la te . In v e s tm e n t s an d n e w p r o d u c t s also retu rn v a lu e in the form o f p u b lic re la tio n s, r e p u ta tio n , a n d p re s tig e. O v e r th e lo n g te r m , an e n h a n c e d r e p u ­ ta tion m a y g e n e ra te a d d itio n a l b u s i n e s s , th us re tu rn in g r e v e n u e s and profits. Y et th e r e is no g u a r a n t e e th a t a c tu a l finan cial r e t u rn s w ill res u lt, a n d th e y are diffi­ cu lt, if n o t im p o s s i b le , to m e a s u re . N e v e r th e l e s s , th e y are often u sed to ju s tify m a j o r in v e s tm e n ts an d s h o u ld b e c o n s id e re d .

M ARKE T ANALYSI S

205

SUMMARY A m a r k e t a n a ly s is is a ca re fu l, critical c o n s id e r a t io n o f th e fa c to rs tha t m a y affect a c o m p a n y ’s su c c e s s in a c o m p e t it iv e e n v ir o n m e n t . W h e n u n d e r t a k e n as a f o r ­ m a l p ro je c t, it is g e n e ra lly d o n e to e v a lu a te th e p o te n tia l fo r a n e w i n v e s tm e n t or p ro d u c t. E ffe c tiv e m e d i a e x e c u t iv e s c o n s t a n tl y s c a n th e c o m p e t it iv e e n v i r o n ­ m e n t w h e r e th ey w o rk , a n a ly z in g it fo r u n re a l iz e d o p p o r t u n it ie s and e m e r g in g th reats. A u th o rs , p ro d u c e r s , o r re p o r te rs w h o se e k s u p p o r t fo r a p ro j e c t id ea m u s t als o u n d e r s ta n d the m a r k e t a n a ly s is p r o c e s s b e c a u s e e x e c u t iv e s g e n e ra l ly w a n t p ro je c ts p itc h e d in th o s e term s. T h e specific issues in v o lv e d in a m a r k e t a n a ly s is v ary from p ro je c t to p ro ject. Y e t the p r o c e s s g e n e ra lly in c lu d e s an e x a m i n a ti o n o f e x te r n a l, in tern al, an d fi­ n a n c ia l c o n d it io n s . T h is enta ils c a re fu l e v a lu a tio n of: (a) lo n g - te rm m a r k e t tren d s an d d e v e l o p m e n t s ; (b) the a c tu a l c o n d it io n s in the p r o d u c t or g e o g r a p h i c m a r k e t; (c) the p r o p o s e d p r o j e c t ’s c o m p a t ib i li ty w ith the fi r m ’s m i s s i o n , o b je c tiv e s , ca p a b ilitie s , an d c u rr e n t b u s in e s s ; a n d (d) the p r o j e c t ’s e f f e c t o n the f i r m ’s lo n g - te rm finan cial p e r f o r m a n c e . A m a r k e t an aly s is se rv es sev eral critical fu n c tio n s. It h elp s m a n a g e r s e f f e c ­ tively m o n i to r the c o m p e t it iv e e n v ir o n m e n t in w h ic h they o p e ra te , ta ke a d v a n ta g e o f n e w o p p o r t u n it ie s o r dea l w ith e m e r g in g threats, an d m a k e b e tte r sh o rt- and lo n g - te rm b u s i n e s s d e c is io n s . T h e ability to e ff e c tiv e ly e v a lu a te the m a r k e t is a critical skill for m e d i a in d u s try m a n a g e r s , w h e th e r they are p r o d u c e r s in the n e w s r o o m o r to p - le v e l c o rp o r a te e x e c u tiv e s .

Case 8.1 A M a r k e t Analysis for McL au ren C om m u nic atio n s

Y o u an d y o u r c o ll e a g u e s are s e n io r a n a ly s ts w ith R C R M e d i a C o n s u lt in g and B r o k e r a g e C o . S a ra h M c L a r e n , o w n e r o f a sm all ra d io station g r o u p called M c L a r e n C o m m u n i c a t i o n s , h as c o n ta c te d R C R . M s . M c L a r e n is a w a re o f tw o ra d io sta tio n s in tw o d iffe re n t, b u t c o m p a r a b l y sized, m a r k e ts th a t arc g o in g up fo r sale. S h e o n ly h a s th e c a p ita l to b u y o n e . S h e h ired R C R to c o n d u c t a m a r k e t a n a ly s is o f the tw o statio n s a n d r e c o m m e n d w h ic h o f the t w o — i f e it h e r— to b uy . M c L a r e n C o m m u n i c a t i o n s c u rr e n tly o w n s five rad io sta tio n s in th re e sm all m a r k e ts , all size 2 0 0 + . A ll five o f th e c o m p a n y ’s c u r r e n t h o ld i n g s are in the m i d w e s t p la in s states. T w o o f th e sta tio n s are A M N e w s T a lk statio n s. T h e o th e r three are F M . O n e h as a c o u n tr y fo rm a t, a n d the o t h e r tw o are C la s s ic R o ck . M cL aren

C o m m u n icatio n s’ com pany

m ission

s t a te m e n t says:

“M cL aren

C o m m u n i c a t i o n s is a s tro n g , p o s itiv e c o m m e r c i a l e n te r p ris e th a t s u c c e e d s

206

CHAP T E R 8

t h r o u g h s e rv in g its c o m m u n i t i e s w ith h ig h - q u a lity in f o rm a t io n an d e n te r ta i n m e n t p r o g r a m m i n g th a t reflect stro ng c o m m u n i t y v a lu e s . ” M s. M c L a r e n ’s stated o b ­ j e c t iv e is to see the c o m p a n y g ro w a n d d iv e r s if y in to d if fe re n t ty p es o f m e d ia . It is also h e r stated g o a l to m a n a g e h e r m e d i a c o m p a n i e s to reflect h e r o w n s tro n g tra d itio n a l v a lu e s , d e e p relig io u s c o m m i t m e n t , an d so c ia lly c o n s e r v a ti v e o u tlo o k . T h e c u r r e n t a n n u a l r e v e n u e s o f M c L a r e n C o m m u n i c a t i o n s are $ 1 0 m illio n. T h e c o m p a n y has a n et profit m a r g in o f o n ly 1%, sm all by b r o a d c a s t s ta n d a rd s , b u t n o t u n u s u a l fo r s m a ll m a r k e t radio . M s . M c L a r e n is the o w n e r an d c h i e f e x ­ e c u tiv e o ffic e r ( C E O ) o f M c L a r e n R a d io . A lth o u g h she h a s a g re a t d e a l o f m e d i a e x p e ri e n c e , she is re la tiv e ly n e w to rad io . F ive y e a rs ag o, she sold the nine sm a ll - to w n w e e k ly n e w s p a p e r s she o w n e d to v e n tu r e into rad io . S h e b r o u g h t h e r n e w s p a p e r m a n a g e m e n t team w ith h er, e x p a n d i n g it by b ri n g in g in the g en eral m a n a g e r o f o n e o f the ra d io sta tio n s she ac q u ire d . M c L a r e n C o m m u n i c a t i o n s has a lre a d y d o n e its o w n a n a ly s is o f finan cial c o n ­ d itio n s and d e t e r m i n e d it h a s the r e s o u rc e s to b u y o n e o f the tw o statio n s. S p e ­ cific fin ancial d a ta fo r th e tw o statio n s w ill n ot be a v a il a b le until M c L a r e n C o m m u n i c a t i o n s o p e n s n e g o ti a ti o n s w ith the o w n e r s . T h e p re l im in a r y m a r k e t a n a ly s is th a t sh e is h irin g R C R to c o n d u c t s h o u ld p r o v i d e s o m e in s ig h t into w h a t ty p e s o f sh o rt- and lo n g - te rm r e v e n u e an d p ro fitability sh e m i g h t e x p e c t from the p ro p e r tie s b a s e d o n the m a r k e ts th ey are in, the c o m p e t it io n th ey face, and the p r o s p e c ts f o r g ro w th . S h e told R C R that she d o e s n o t e x p e c t specific fin a n ­ cial figures, b ut ra th e r a g e n e ra l d e s c r ip tio n o f w h ic h p r o p e r ty is likely to g e n e r ­ ate th e b e st R O I in the sh o r t an d long te rm b a s e d on p u b li c ly a v a ila b le in f o rm a tio n .

A S S IG N M E N T T h e p r e s id e n t o f R C R a s s ig n s yo u to c o n d u c t the m a r k e t a n a ly s is o f M c L a u r c n C o m m u n i c a t i o n ’s p ro p o s e d a c q u is itio n s . T h e

tw o

sta tio n s up fo r sale arc

W S A C - F M in M i d to w n an d K S N T - F M in A re a v ille . Y o u r j o b is to w rite a th o r ­ o u g h , d e ta ile d m a r k e t a n a ly s is , c o n c lu d i n g w ith a firm r e c o m m e n d a t i o n a b o u t w h ic h ra d io station to b u y an d w h y , p r o v i d e d y o u d e c id e to r e c o m m e n d th at M c L a u r e n C o m m u n i c a t i o n s b u y o n e at all. Y o u r r e p o r t s h o u ld in c lu d e a ste p -b y step d is c u s s i o n o f th e critical facto rs that a m a r k e t a n a ly s is in c lu d e s , as w ell as: (a) a c o m p a r is o n o f th o se facto rs b e tw e e n the tw o m a r k e ts u n d e r c o n s id e r a t io n , (b) an an a ly s is o f w h a t y o u th in k th o s e fa cto rs w ill m e a n in te r m s o f the s t a t i o n s ’ sho rt- an d lo n g - te rm p e r f o r m a n c e s an d w h y , an d (c) a final r e c o m m e n d a t i o n as to w h ic h station M c L a r e n C o m m u n i c a t i o n s s h o u l d b uy , if e it h e r o n e , an d w h y y o u are m a k i n g th at r e c o m m e n d a t i o n b a s e d on the fa c to rs y o u id en tified in y o u r m a r k e t a n aly s is.

M ARKE T ANALYSI S

207

In ad d itio n to the d a ta p r o v i d e d , y o u m a y c o n d u c t y o u r o w n re s e a rc h , p a r t i c u ­ larly to fo r e c a s t tre nd s. S o u rc e s to c o n s u l t m a y in c lu d e : S tatistic al A b s tr a c ts o f th e U n ite d S tates (a v a ila b le in p rin t an d o n lin e ), N a tio n a l A s s o c i a tio n o f B r o a d ­ c a ste rs W e b Site, a n d c u rr e n t b o o k s , trade p u b li c a ti o n s an d jo u r n a l articles on th e ra d io in d u s try , in c lu d in g V e r o n is & S u h le r C o m m u n i c a t i o n s I n d u s try F o r e ­ c a st an d In v e s tin g in R adio .

M id to w n 1 M i d t o w n is a s m a ll c o m m u n i t y in a s m a ll state in th e n o rt h e a s t U n ite d S tate s lo c ate d 1 h o u r fro m tw o d if fe re n t m a j o r m e tr o p o l it a n a rea s . S o m e s ig n a ls fro m m e d ia b a s e d in th o se cities r e a c h M i d to w n . H isto ric a lly , the c o m m u n i t y w a s a f ­ fluent, reflecte d b y the h ig h m e d i a n i n c o m e the to w n r e p o r te d in p a st y ears . Y et m o s t o f the a fflu e n t c o m m u n i t y m e m b e r s are in the h ig h - te c h a n d finan cial s e r ­ v ice s in d u s trie s, w h ic h w e re hit hard in r e c e n t y e a rs by lay o ffs. M a n y jo b s in the h ig h - te c h s e c to r w e re in the d o t.c o m in d u s try . C u rre n t ly , u n e m p l o y m e n t is high a n d h as n o t y e t s h o w n u p in m e d i a n i n c o m e figures. It w ill ta ke s e v e r a l y e a rs to r e c o v e r the lo s t h ig h - te c h jo b s , an d m a n y e x e ­ c u tiv e s from th at in d u s try arc le a v in g the area to find p o s itio n s e ls e w h e r e . City officials e x p e c t in the n e x t fe w y e a rs the c o m m u n i t y will see a slig h t d e c lin e in p o p u la t io n and m e d i a n in c o m e . H o w lo n g the d o w n tu r n will last is n o t p re d ic ta b le . M i d to w n is p rim a rily a su b u r b a n b e d r o o m c o m m u n i t y for la r g e r u rb a n areas n e a rb y . M o r e than 5 0 % o f the p o p u la t io n c o m m u t e s in to the n e a rb y cities to w o rk , reflecte d in the a v e ra g e travel tim e to w o rk . T h e a u d ie n c e is in ca rs d u rin g the critical “ D riv e T i m e ” ra d io d a y p a rt. D u r in g the 1990s, d o t.c o m e n tr e p r e n e u r s set u p o p e ra t io n s an d b e c a m e an i m ­ p o rta n t pa rt o f the M i d to w n e c o n o m y . A few still su rv iv e . T h e c o m m u n i t y has a v ib r a n t retail s e c to r tha t d r a w s c u s t o m e r s fro m n e a rb y c o m m u n it ie s . T h e s tre n g th o f the retail s e c t o r is reflected in the h ig h retail sa les fig ures re la tiv e to the p o p u la t io n size. B e s id e s retail and the few tech c o m p a n i e s th at r e m a in , M i d to w n is p ri m a ri ly a re s id e n tia l c o m m u n it y . M i d to w n is c o m p l e te l y h e m m e d in by o t h e r in c o r p o ra t e d c o m m u n i t i e s and is u n a b le to e x p a n d g e o g r a p h i c a ll y . T h e c o m m u n i t i e s i m m e d i a te l y s u r r o u n d in g it h a v e in d u s tria l e c o n o m i e s an d so lid b lu e - c o ll a r p o p u la t io n s , w h e r e a s M i d t o w n is a w h ite - c o ll a r islan d in th e area. M i d t o w n is lo c a te d in the m i d d le o f the state, h a lf w a y b e tw e e n the n o rth ern A p p a la c h i a n M o u n t a i n s and the A tla n tic O c e a n . T h e lo cal te rrain is ro llin g an d hilly.

1 All persons, stations, c ommunitie s, media com pan ies, and data in this case study are c om plete ly fictitious. A ny similarity to actual individuals or c om pan ie s is purely coincidental.

208

CHAPTER 8

L ifesty le scales identify M i d t o w n ’s residents as being “2nd City S o c ie ty ” or “u pscale e x e cu tiv e and y o u n g u pscale w h ite-co llar; affluent retirees.” M u c h o f the recent ex -u rb an m igratio n out o f the cities settled in tonier c o m m u n itie s eith er along the m o u n tain s o r the sea, now c o n sid ered to be largely “Elite S u b ­ u rb s” (superrich, ex ecu tive , upscale w h ite-co lla r co up les) o r “ U rb an U p to w n ” (elite, upscale, b o h e m ia n singles and co up les). Politically, the c o m m u n ity is m o derately con serv ativ e, b ut not particularly religious.

Areaville A reaville is a m id -siz e c o m m u n ity in the Pacific N o rth w e s t that is rapidly tran s­ fo rm in g itself from a fa rm in g tow n to a sm all city. L o cated 90 m inu tes from a m ajo r urban area, a rang e o f hills b etw ee n the tw o co m m u n itie s blo cks m o s t o f the c it y ’s radio and TV signals from reaching A reaville, alth ou gh so m e TV sig­ nals are carried on the A reaville cable system . It is 3 h o u rs from the sea in a v al­ ley dotted with orchard s, farms, and sm all lakes. H istorically, the c o m m u n ity w as solidly m id dle class, g ro u n d e d in farm ing and diversified sm all industry. R ecen tly , A reaville benefited from an ex-u rb an m igration from the n earby city and S ou th ern C alifo rn ia, w hich in creased the local p o p u la t io n ’s affluence. T h e lifestyle o f the area is attracting m edia and e n ­ tertain m e nt p ro fessio n als w h o w an t to leave C alifornia. T h ey are m o v in g in to live and c o m m u te back to S o u th ern C alifo rn ia for pro jects. A s a result, both in A reaville and the n earby city a vibrant new industry o f sm all m edia pro du ction c o m p a n ie s is sprin gin g up as H o lly w o o d d isc ov ers the region is a go od place to live and do business. L a b o r and p rod uction costs are m u c h lo w e r than in S o u th ­ ern C alifornia, resulting in a steady g ro w th rate th ro u g h o u t the 1990s and an u n e m p lo y m e n t rate lo w er than the natio nal av era g e o f 5 .6% . Y et the larg er e c o n ­ o m y re m a in s diversified, d e m o n s tra te d by the a r e a ’s occ up atio na l profile. D e ­ spite the ch an g cs, the c o m m u n it y re m a in s solidly m idd le class. T h e city is in an isolated valley, an d no natural features exist to limit its ph ysical ex pan sion . S o cio lo g ically the c o m m u n it y is ethn ically diverse. Its p s y c h o g rap h ic profile is a mix o f m id-level w hite -co llar cou ples and m idd le-class b lue-co llar fam ilies, with a scattering o f rural farm and ranch fam ilies and elite ex -u rb an e xec utiv es seeking sm all-to w n life. T he c o m m u n ity is politically liberal with strong su pp ort for such issues as im m ig ratio n rights and the en v iro n m e n t. O u td o o r activities are popular. A re a v il le ’s size and distan ce from o th er urban cen ters m e a n s the a v er­ age c o m m u te for residents is quite short, and a substantial percen tag e use a lter­ native sy stem s such as bicycles and public transportation.

MARKET ANALYSIS

C o m m u n i t y Profiles M id to w n

A r e a v ille

Ma r ke t size R a d io m a r k e t size

193

175

91

87

T o ta l p o p u la t io n

1 7 4 .4 0 0

3 9 6 ,4 8 7

T o ta l h o u s e h o l d s

7 2 ,5 0 0

9 4 ,7 0 0

T e le v i s io n siz e

Population

Househol ds by income

%

U n d e r $ 1 9 .9 9 9

8.2

% 15.4

$ 2 0 ,0 0 0 -3 9 ,9 9 9

11.1

20 .9

$ 4 0 ,0 0 0 -7 4 ,9 9 9

2 2 .6

28 .6

$ 7 5 ,0 0 0 -9 9 ,9 9 9

14.8

13.9

$ 1 0 0 ,0 0 0 +

4 3 .3

2 1 .2

M ed ia n incom e U n e m p l o y m e n t rate

$87,05 9 7 .2 %

Ethnic populati on

%

W h it e

9 2 .5

$ 5 5 ,2 5 3 4 .2 %

% 7 5 .4

A fric a n A m e r i c a n

2 .4

8.3

H is p a n i c

4.5

11.1

A sia n

0 .6

5.2

Educat ion

%

%

G rades 0-11

15.1

11.9

H ig h s c h o o l g ra d

2 6 .7

28.7

C o ll e g e 1 -3 y e a rs

2 3 .3

31.8

C o ll e g e 4 + y e a rs

3 4.9

2 7 .6

Occupat ion

%

M a n a g e r ia l

3 5 .5

20.5

T echnical

3 3 .5

25.7

Service w o rk er

9 .4

15.5

F arm w orker

1.2

9.0

10.6

11.3

9.8

18.0

P re c is io n p r o d u c t io n O p erato r

Trans portat ion to work

%

%

%

P u b lic

12.4

0.8

D riv i n g

7 5.9

70.3

C arpool

6.4

12.6

O ther

5.3

16.3

A v e r a g e t r a v e l tim e (m in .)

Retail sales data T o ta l re tail sales R etail e x p e n d it u r e p e r h o u s e h o l d

60

$ (000) 3 ,3 7 3 ,9 8 6

15

$ (000) 3 ,4 4 6 ,0 4 7

5 7 ,6 8 7

3 3 ,7 8 9

G r o c e r y , fo o d , & b e v e r a g e

8 7 8 ,1 1 8

8 81,351

R e s ta u r a n ts & ba rs

3 2 0 ,5 8 1

3 2 4 ,5 8 6

209

210

CHAP T E R 8

C o m m u n ity Profiles (continued) M id town

Areaville

G e n e r a l retail & c l o t h i n g

800,037

81 0,222

M o t o r v e h i c l e s a n d p a r ts

7 8 3,146

798,543

B uilding supplies

319,548

323,456

H e a l t h & p e r s o n a l care

1 5 3 ,2 4 7

150,672

F urniture, appliances, & electronics

1 1 9 ,3 0 9

1 2 3 ,4 2 8

Radio: time sp en t listening (TSL) (M o n .-S u n . 6 a.m .- M id .)

(Min.)

(Min.)

P e r s o n s 1 2 + ( m in . )

17 :30

1 8:3 0

M en 18-34

1 6:3 0

1 9 :3 0

Men 25 -5 4

18:45

21:30

Men 35-64

20:15

21:15

W om en 18-34

18 :30

17:15

W om en 25-54

19:00

1 8:0 0

W om en 35-64

17:45

1 7 :0 0

Midtown Cable O w n e r : N a tio n a l M S O C a b le .* C h a n n e l c a p a c ity : 80 C h a n n e ls A v a ila b l e c h a n n e ls : 5 I C h a n n e l o f lo cal p r o g r a m m i n g T e c h n o lo g y : D ig ital H o m e s p a ss e d : 6 9 ,8 9 7 S u b s c r ib e rs : 3 5 ,4 0 0

Midtown Print Media L ocal

D aily:

M i d to w n

D aily

R e g iste r.

D is trib u te d

m o r n in g s ,

M onday-

S u n d a y . C irc u l a ti o n 5 9 ,6 5 8 . O w n e r : M a j o r G r o u p N e w s p a p e r s .* M i d t o w n C ity Life. M o n t h ly city an d lifestyle m a g a z in e . C irc u l a ti o n 5 ,00 0 . O w n e r : M a j o r G r o u p N e w s p a p e r s .* T w o city d a ilies fo r the n e a rb y m e t r o p o l it a n a rea s also are d is trib u te d in M i d to w n .

Areaville Cable O w n e r : N a tio n a l M S O C a b le * C h a n n e l ca p a c ity : 100 C h a n n e ls A v a ila b l e c h a n n e ls : 2 D eno te s a major media group: More than 150 radio stations nat ionwide; 15% or more o f the total TV v ie w in g audience nat ionwide; 10% or more o f the local cable sy st em s nat ionwide; 1 5 + daily new spapers nationwide.

M idtow n Radio Stations Rank 12+ 6 a.m. Mid. 1 2 3 4 5 6 7 8 9 9 11 12 13 14 14 16

Call Letters

D ial Position

Format

A Q H Share

Owner

Inside/Outside M etro Area

Watts

Ant. High

W VAD-FM W GGR-FM W SSS-FM W DGF-FM W RUF-AM W BAT-FM W W A R-FM W NBB-AM W A TH -FM W COL-FM W M LC-AM W SAC-FM W SEA-FM W Q Y Q -FM W ZRT-FM W STS-FM

98.3 99.9 95.1 101.1 660 100.5 92.5 770 104.7 102.9 940 105.5 101.3 93.7 97.3 100.7

Hot Adult Contem porary Adult Contem porary A lbum -O riented Rock Oldies All Sports Oldies Country News Talk Inform ation Pop Contem porary Hit O ldies Nostalgia Pop Contem porary Hit Country Rhythm ic Oldies Pop Contem porary Hit U rban

14.3 8.0 7.9 4.2 3.9 3.5 3.4 2.5 1.9 1.9 1.8 1.7 1.2 1.0 1.0 0.8

Jayson Media Big Group* Tom s Radio Sm ith Radio* CPU Radio Big Group* Sm ith Radio* CPU Radio State Commun. Smith Radio* Jayson M edia Seascape Media Seascape M edia CRC Radio State Commun. CPU Radio

In Out In Out In In Out In Out In In In Out Out In Out

1,300 27,500 29,500 6,800 50,000 900 17.000 50,000 7.400 19,500 680 16,500 10,000 21,000 6.000 50.000

140 204 194 404 186 268 381 247 173 326 238 473 152

* Denotes a major media group: More than 150 radio stations nationwide; 15% or more of the total TV viewing audience nationwide; 10% or more of the local cable systems nationwide; 15+ daily newspapers nationwide.

212

CHAP T E R 8

M id to w n Television R a n k (E vening N e w s )

C all Letters

C ha nne l

N e tw o rk

Owner

1

W C TV -TV

2

NBC

L igon

2

W R D V -T V

11

CBS

P ark er Television*

Com m unications* 3

W Q Q T -T V

6

Fox

4

W N B B -TV

4

ABC

C laude

7

W PB S-TV

7

PBS

M id to w n U nified

B yers M edia C om m unications* S chool D istrict

* D eno te s a major media group: More than 150 radio stations nat ionwide; 15% or more o f the total TV v ie w in g audience nat ionwide; 10% or more o f the local cable sy st em s nat ionwide; 1 5 + daily newsp apers nat ionwide.

3 C h a n n e l s o f lo cal p r o g r a m m i n g T e c h n o lo g y : D igital H o m e s p a ss e d : 8 3 ,4 5 0 S u b s c r ib e rs : 5 8 ,4 15

Areaville Newspapers A re a v ille N e w s H e ra ld . D is trib u te d m o r n in g s , M o n d a y - S u n d a y . C irc u la tio n 7 3 ,5 8 9 . O w n e r : T e rre ll F a m i ly M e d ia .

Case 8.2 A M a r k e t Analysis for CPU Radio C ro up

Selecting Potential Radio Formats C P U R a d io G r o u p in M i d t o w n hired R C R M e d i a C o n s u lt in g to e x a m i n e the p e r ­ f o r m a n c e o f W S T S - F M . the l o w e s t ra ted station in M i d to w n . U se the d ata d e ­ sc r ip tio n s in C a s e 8.1 and y o u r o w n re s e a rc h on c u rr e n t ra d io liste n in g tren d s to do a m a r k e t a n a ly s is on p o te n tia l rad io f o r m a ts fo r W S T S - F M in M i d to w n .

A S S IG N M E N T M a k e a r e c o m m e n d a t i o n to th e e x e c u t iv e s o f C P U a b o u t p r o g r a m m i n g o p ti o n s to c o n s i d e r fo r W S T S - F M . A n s w e r the fo l lo w in g q u e stio n s: I. W h a t are th ree ra d io p r o g r a m m i n g o p tio n s that C P U Inc. m a n a g e r s m ig h t w a n t to c o n s i d e r as p o s s ib le fo r m a ts for W S T S - F M ?

A reaville R adio R a n k Ì2+ 6 a.m .

C all L etters

D ial Position

F orm at

A Q H Share

O w ner

Inside/O utside M etro A rea

W atts

Big Group* Smith RadiolBig Group* R Squared* Big Group* Big Group* Smith Radio* R Squared* Areaville Radio Inc. Big Group*

In In In In In In In In In Out

1,000 100,000 100,000 3,000 670 3,000 100,000 100,000 31,000 100,000

Johnson Radio Areaville Radio Smith Radio* Wyatt Radio Areaville Radio

In In In Out In

50,000 100,000 1,000 5,000 100,000

M id.

1 2 3 4 5 6 7 8 9 10

KKID-AM KHRH-FM KSPK-FM KBRZ-FM KSWT-AM KCOW-FM KKRN-FM KJNK-FM KCRP-FM KQTE-FM

1240 96.9 102.7 106.3 1400 105.3 107.3 98.1 104.1 97.7

11 12 12 13 14

KNEE-FM KRNN-FM KMRY-AM KWRM-AM KSNT-FM

95.1 96.1 1480 590 98.5

News Talk Information Country Pop Contemporary Hit Album-Oriented Rock News Talk Information Oldies Hot Adult Contemporary Country Pop Contemporary Hit Rhythmic Contemporary Hit Classic Rock Adult Contemporary All Spoils Album-Oriented Rock Urban

10.0 8.3 7.6 6.7 5.6 5.0 4.9 4.3 4.2 3.6 3.3 1.8 1.8 1.6 1.0

Ant. High (m trs) 177 131 65 100 168 299 187 297 87 430

358

* Denotes a major media group: More than 150 radio stations nationwide; 15% or more of the total TV viewing audience nationwide; 10% or more of the local cable systems nationwide; 15+ daily newspapers nationwide.

214

CHAPTER 8

Areaville TV R a n k (E v e n i n g N e w s )

C a ll L e tte rs

Channel

N e tw o r k

Owner

1

K S T C -T V

2

CBS

B ig G ro u p T e le v isio n *

2

K D C R -T V

11

ABC

T errell F am ily M e d ia R M R T elevision*

3

K R V W -T V

6

NBC

4

K R SS-T V

4

Fox

P ictures

5

K U C T -T V

9

WB

Jones

6

K R C R -T V

13

UPN

Jones

7

K PB S-T V

8

PBS

U niversity o f A reaville

C o m m unications* C o m m unications* C o m m unications*

* D enotes a m ajor media group: More than 150 radio stations nationwide; 15% or more of the total TV viewing audience nationwide; 10% or more o f the local cable system s nationwide; 1 5+ daily newspapers nationwide.

2. D i s c u s s in d e ta i l th e p r o s a n d c o n s o f e a c h o f t h o s e o p t i o n s in th e c o n t e x t o f th e M i d t o w n m e d i a m a r k e t . 3. W h a t arc th e c u r r e n t lis t e n in g t r e n d s n a t i o n w i d e f o r th e th r e e r a d i o f o r m a t s y o u a rc p r o p o s i n g f o r W S T S - F M ? W h a t m i g h t th e i m p l i c a t i o n s o f t h o s e tren d s be for y o u r re c o m m e n d a tio n s ? 4. W h i c h o f th e t h r e e a rc y o u m o s t s t r o n g l y r e c o m m e n d i n g to C P U a n d w h y ? B e s u r e to a r g u e y o u r c a s e .

Case 8.3 O p tio n s fo r C o n d u c tin g a M a r k e t Analysis

O p tio n A .

S e l e c t a lo c a l n e w s p a p e r , m a g a z i n e , r a d i o s ta tio n , lo c a l c a b l e s y s ­

tem o p e r a t o r , T V s t a ti o n , o r W e b c o m p a n y . C o n d u c t a m a r k e t a n a l y s i s o f its p o ­ sitio n in th e m a r k e t . W r i t e y o u r r e p o r t fo r a p o t e n t i a l i n v e s t o r , i n c l u d i n g a d e t a i l e d a n a l y s i s o f th e m e d i a c o m p a n y y o u h a v e s e l e c t e d a n d its m a r k e t . A d ­ d r e s s th e is s u e s o u t l i n e d in th e c h a p t e r . M a k e a b u y / d o n o t b u y r e c o m m e n d a t i o n to th e i n v e s t o r b a s e d o n y o u r m a r k e t a n a l y s i s a n d a r g u e fo r y o u r r e c o m m e n d a ­ tio n b a s e d o n y o u r a n a ly s is . O p tio n B.

C o n d u c t a m a r k e t a n a l y s i s o f a s e l e c t e d c o m m u n i t y a n d th e

m e d i a a l r e a d y s e r v i n g it. T r y to i d e n t if y a n a v a i l a b l e m a r k e t n ic h e fo r m e d i a in t h e c o m m u n i t y t h a t is n o t b e in g m e t. W r i t e y o u r m a r k e t a n a l y s i s as a b u s i n e s s p la n fo r th a t m e d i a o p p o r t u n i t y . D i s c u s s e a c h o f the i m p o r t a n t fa c t o r s in a m a r ­ k e t a n a l y s i s in d eta il.

MARKET ANALYSIS

215

O p tio n C. Identify a m a jo r project that you w o u ld like to pursue: an im p o r­ tant lon g-term inv estig ative n e w s story, a film idea, a TV series, and so on. Do a detailed m ark et analysis for y o u r project ad dressin g the im p o rtan t factors that need to be c on sid ered . T h en tak e on e o f the tw o follo w in g actions: 1. Use the m ark et analysis process to identify a real m ed ia c o m p a n y that m ig ht sup po rt y o u r project. D escrib e in detail the m ark et factors for that c o m p a n y that are relevant to y o u r p roject idea. E x plain carefully w hy you think y o u r p roject m igh t be app ro priate for that c o m p a n y to support based on the analyses you h av e do ne fo r y o u r p ro ject idea and for y o u r target investor. 2. Im ag ine you are an e m p lo y e e in a real m ed ia c o m p a n y , such as a local n e w s p a p e r or T V station that m igh t be interested in y o u r project. U se the m arket analysis p rocess to identify th at c o m p a n y ’s market. D ev elo p an ef­ fective app ro ach to use w ith y o u r su perv iso r in that c o m p a n y to gain s u p ­ port for y o u r idea. B ase y o u r pitch on the m ark e t analy sis you c on du cte d fo r y o u r p ro ject and the c o m p a n y . E x p lain to y o u r su p erv iso r how the c o m p a n y ’s m a r k e t position will be im p ro v e d if you arc allo w e d to p u rsu e y o u r idea. Sources you m ay w ant to consult as you do y o ur research include: B a c o n ’s M edia Directories, B lair’s Television and Cable Factbook, Broadcasting and C able Y earbook, the c o m m u n it y ’s W e b site, and the local C h a m b e r o f C o m m erce. C u rre n t b oo ks, trade p ub lica tion s, and jo u rn a l articles on the m edia industry sector o f interest m ay be useful including: E d ito r and P u b lish er Y e a rb o o k . In ­ vesting in R a d io , Investin g in T e le visio n, N atio nal A ssoc iatio n o f B ro adcasters W e b site, N a tio n a l A sso c iatio n o f B ro adc asters T elev isio n F in a n c ial R eport, S tand ard Rate & D ata, Statistical A bstracts o f the U nited States (available in print and online), and V e ro n is & S u h ler C o m m u n ic a tio n s Industry Forecast. T h ere arc m a n y oth er reso urces, directories, fact bo ok s, and sou rces o f in fo r­ mation th at co uld pro vid e you w ith valu able in fo rm atio n for a m ark et analysis. A sk y o u r librarian for help in locating them .

C H A P T E R

9 M

a r k e t in g

and

R

esearch

T h is c h a p t e r e n a b le s the r e a d e r to d e v e lo p a b r o a d p e rs p e c ti v e on m a r k e ti n g and r e s e a rc h . M a n y m a r k e ti n g d e c is io n s , re s e a rc h q u e s t io n s , m e t h o d s , a n d i n f o r m a ­ tion g a th e r e d are c o m m o n a c ro s s m e d i a o rg a n i z a ti o n s . T h e b a sic ty p e s o f r e ­ s e arch q u e s t io n s an d m e t h o d s u sed by m e d i a o rg a n i z a ti o n s are d is c u s s e d . M a j o r p ro v i d e rs o f m e d i a re s e a rc h an d o n lin e re s e a rc h r e s o u rc e s a re p re s e n te d . W ith the in c r e a s i n g c o m p e t it iv e n e s s o f the m e d i a in d u s try , m a r k e ti n g an d r e ­ s e a r c h a c tiv ities are c e n tr a l to the j o b o f m e d i a m a n a g e m e n t . M a r k e tin g a c ti v i­ ties r e v o l v e a r o u n d d e c is io n s a b o u t the m a r k e ti n g m i x o r f o u r P s — p r o d u c t , p r i c i n g , p l a c e m e n t (d istr ib u tio n ), an d p r o m o t i o n . T o m a k e th e s e d e c is io n s , m a n ­ ag e rs n e ed a n s w e r s to q u e s t io n s a b o u t th e ir c u s t o m e r s . F o r m e d i a m a n a g e r s , the tw o ty p e s o f c u s t o m e r s are c o n s u m e r s (re a d e rs, v ie w e rs , o r listen ers) an d a d v e r ­ tisers. O n e w a y m e d i a m a n a g e r s use re s e a rc h is to d e v e lo p pro files o f th e ir c o n ­ s u m e r s to m a r k e t th e ir s p a c e or tim e to a d v e rtise rs.

M A R K E T IN G A N D A D V E R T IS IN G IN T O D A Y 'S M E D IA E N V IR O N M E N T M a r k e tin g is the “p r o c e s s o f p la n n i n g an d e x e c u t in g the c o n c e p t io n , p ric in g , p r o ­ m o tio n , an d d is trib u tio n o f ideas, g o o d s , a n d s e r v ic e s to c re a te e x c h a n g e s that satisfy in d iv id u a l an d o rg a n i z a ti o n a l o b j e c t i v e s ” ( A M A B o a rd , 1985, p. 1). M a r ­ k e te r s c o n s i d e r the c o r r e c t b le n d and e m p h a s is o f m a r k e ti n g m ix e le m e n ts n e e d e d to a ttra c t a n d satisfy th e ir p r i m a r y c u s t o m e r s or ta r g e t s e g m e n ts . T h e s e m a r k e ti n g m ix d e c is io n s are c ru c ia l to d e te r m i n in g the m e s s a g e c o n te n t and m e d i a p l a c e m e n t o f a d v e rtisin g . A d v e r t i s i n g ’s ro le in the m a r k e ti n g m ix is to c o m m u n i c a t e th e v a lu e a b ra n d , p ro d u c t , serv ic e, o r m e d i a o u tle t h a s to o ffe r to the d e s ire d ta r g e t se g m e n t. M a j o r a d v e rtis e rs u se in te g ra te d b ra n d p r o m o ti o n s (I B P ) a n d /o r in te g ra te d m a r k e ti n g c o m m u n i c a t i o n s ( I M C ) for p r o m o ti o n a l p la n n in g . IB P is th e u s e o f v a r i o u s p r o m o t i o n a l t o o ls, i n c l u d i n g a d v e r t i s i n g , in a c o o r d i n a t e d m a n ­ n e r to b u i l d an d m a i n t a i n b r a n d a w a r e n e s s , i d e n t i t y a n d p r e f e r e n c e . W h e n m a r ­ k e t e r s c o m b i n e c o n t e s t s , a W e b site, e v e n t s p o n s o r s h i p , a n d p o i n t - o f - p u r c h a s e

216

M A R K E T I N G A N D RESEARCH

21 7

d i s p l a y s w ith a d v e r t i s i n g , th is c r e a t e s an i n t e g r a t e d b r a n d p r o m o t i o n . ( O ' G u i n n , A l l e n , & S e m e n i k , 2 0 0 3 , p. 13)

IM C is “ the p r o c e s s o f u sin g p r o m o ti o n a l to ols in a u n ified w a y so th at a s y n e r g is tic c o m m u n i c a t i o n e ff e c t is c r e a t e d ” ( O ’G u in n , A lle n , & S e m e n i k , 2 0 0 3 , p. 37). T h e g r o w th o f c ab le , d ir e c t satellite c h a n n e l s , an d the In te rn e t r e s u lte d in the fr a g m e n t a tio n o f m a s s m e d i a a u d ie n c e s . T h e p r i m e t i m e (o r 8 -1 1 p.m . E a ste rn tim e ) a u d ie n c e s h a r e s for the fo u r m a j o r T V n e tw o r k s d e c li n e d from 7 2 % a d e c a d e ag o to 4 6 % in 2 0 0 2 ( G re e n , 2 0 0 2 ). IB P and IM C i n c r e a s e d in i m p o r t a n c e b e c a u s e a d v e rtis e rs m u s t d efine a nd a ttra ct s m a lle r, m o r e p re c is e s e g m e n ts o f c o n s u m e r s w h o s h a r e s i m i la r c h a ra c te ris tic s . A re s u lt o f f r a g m e n t a tio n is tha t a d ­ v e rtise rs c o n s i d e r a w id e r r a n g e o f o p ti o n s fo r a d v e rtis in g p l a c e m e n t in c lu d in g tra d itio n a l, n o n tr a d it io n a l , an d sp e c ia liz e d m e d ia . T ra d it io n a l m a s s m e d ia su ch as rad io , T V , n e w s p a p e r s , an d m a g a z in e s d e liv e r la r g e r a u d ie n c e s (e.g., fo r p o p u la r p ri m e t im e p r o g r a m m i n g and m a j o r sp o rtin g e v e n ts like the S u p e r B o w l ) an d s p e c ia l a u d ie n c e s attra c te d to c e rta in ed ito ria l c o n te n t (e.g., sp o rts fan s to the sp o r ts s e c tio n o f a da ily n e w s p a p e r ) . N o n t r a d i ­ tio n al m e d i a in c l u d e the In tern et, T V s c r e e n s in a irp o rt w a itin g a rea s, p o s te rs at p u b lic e v e n ts , an d g ro c e r y store c a rt or floor a d v e rtis in g . S p e c ia liz e d m e d i a in ­ c lu d e d irect m ail, b illb o a r d s , s u b w a y p o s t e rs or c a r c a r d s on b u se s , a n d F S Is or fre e -s ta n d in g inse rts in n e w s p a p e r s . O th e r sp e c ia liz e d o r n ich c m e d i a attract a u d ic n c c s w ith sp ecia l inte rests, su c h as p r o f e s s i o n a ls (e.g., p h y s i c ia n s an d a tt o r­ n e y s ) u sin g trad itio n al m e d i a a n d film s, tra d e s h o w s , c o n v e n ti o n e x h ib its , tapes, a n d C D s . M e d i a m a n a g e r s m u s t re a liz e th at a d v e rtis e rs n o w c o n s i d e r m a n y c o m p e t it o r s w h e n d e c id i n g w h e r e to p la c e a d v e r t is e m e n ts ( O ’G u in n , A lle n , & S e m i n ik , 2 0 0 3 ; S is so rs & B a ro n , 2 0 0 2 ). P o sitio n in g is d e s ig n in g a b ra n d so it o c c u p ie s a d is tin c tiv e an d v a lu e d p la c e in the target c o n s u m e r ’s m i n d relativ e to o th e r b ra n d s ( O 'G u i n n , A llen , & S e m in ik , 2 0 0 3 , p. 2 1 2 ). P o s itio n in g d e v e lo p s a p e rc e p t u a l s p a c e o r h o w a b r a n d (or n e w s ­ p a p e r, station , o r W e b site) is p e rc e i v e d on a v a rie ty o f d im e n s i o n s , su c h as q u a l ­ ity o r so cial d is p la y v a lu e . F o r e x a m p l e , T he N e w Y o rk T im e s p o s i ti o n s its e lf as a h ig h - q u a lity , in - d e p th , in f o rm a t iv e p a p e r fo r e d u c a t e d , so p h is tic a te d , an d afflu ­ ent re a d e rs. A d v e r ti s e r s c o m m u n i c a t e the p o sitio n o f th e b ra n d o r p r o d u c t — m e d i a o r o t h e r w i s e — u sin g a d v e rtis in g , IB P , a n d /o r IM C to c reate the d e sire d im a g e in th e m i n d s o f c o n s u m e r s it targets. T h e c o n te n t o f m e d i a o u tle ts is d e v e lo p e d to a ttract a sp ecific ally d efin e d ta r ­ g et a u d ie n c e , ju s t as m a n u f a c tu r e r s c re a te p ro d u c t s d e s i g n e d to a ttra ct a targ e t s e g m e n t o f c o n s u m e r s . O fte n m e d ia p r o d u c t s are d e s i g n e d f o r a u d ie n c e s th a t a d ­ v e rtise rs d e s ire to r e a c h (e.g., th e T V p r o g r a m “F r i e n d s ” ta rg e ts y o u n g ad u lt v ie w e rs ). In this c a se , the a d v e rtis e r an d m e d i a m a n a g e r targ et the s a m e a u d i ­ e n c e, a n d the m e d i a m a n a g e r also ta rg e ts the a d v e r t is e r by targ e tin g th e a d v e r ­ t i s e r ’s a u d ie n c e . A lte r n a ti v e ly , the m e d i a m a n a g e r m a y a c c e p t the a u d ie n c e

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attracted by the editorial co n te n t o f the m edia vehicle and then find advertisers interested in ta rgeting that audience. O v e r the p ast 50 years, the d e v e lo p m e n t o f m ark etin g , IBP, IM C , and p o si­ tioning created the need for a new orga niz atio nal fu n c tio n — m arke tin g research. M ark e tin g research en ables m ed ia m a n a g e rs to d is c o v e r their a u d ie n c e ’s needs and w ants and d e term in e how best to m e et them . T h e ch ap te r d iscu sses the m a r ­ keting research p rocess, how to dev elo p and design research, and the m ajor m ed ia research c om pan ies.

THE MARKETING RESEARCH PROCESS It is im po rtan t to c o n d u c t research sy stem atically an d objectively to ensure the quality o f the in fo rm atio n o btain ed. N o m a n a g e r w ants to spen d tens o r h un dred s o f th o u s a n d s o f dollars g athe rin g info rm ation unless it accu ratcly rcflccts reality. S y s t e m a t i c research is well plan ned and org anized. All the details arc outlined in a d v a n c e o f data collection. O b j e c t i v e research is void o f bias. R esearch bias a p ­ p ears in m a n y form s, but often results from a re s e a rc h e r’s preco n ceiv ed desires o r e x p ecta tio n s for the o u tc o m e o f the research study.

Stages of M arketin g Research T he pro cess o f m arketing research is sim ilar to the research process in oth er areas o f study. T h ere are eight stages to the process. R e s e a r c h Q u e stio n . T his stage is also referred to as setting research o b je c ­ tives. T h e research qu estion m a y be abo ut a p articular p ro b le m , such as: W h y do c o n s u m e rs b uy one p ro d u c t rather th an an oth er? or W h ic h n e w s p a p e r design do readers prefer? S o m e researche rs p refer to set ob jectives rath er than state q u e s ­ tions. F o r e x a m p le , the second qu estio n phrased as an ob jectiv e is: D eterm in e the n e w s p a p e r desig n readers prefer. S e c o n d a r y R e s e a r c h R ev iew . A research er rev iew s the available inform ation on a topic o f interest before co n d u ctin g research. O ften en ou gh data are available to save the tim e and m o n ey necessary fo r a new research study. S econ dary re­ search is often used by m ed ia m anag ers and is d iscussed later in the chapter. P r im a r y R e s e a r c h D esig n . T h e res e arc h e r d ev elo p s a plan o r d e s i g n for the study. W ill the study be qualitative and use intuitive d ata collection, o r q u a n tita ­ tive and use specific m e a s u re m e n t te chn iq ues like su rv ey s? W h a t type o f q u a n ti­ tative or qualitative research w o uld be best? W h y ? T h e desig n for the study is d riven by the research questions.

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219

D a ta-C ollection P rocedure. The specific data needed to an sw er the research question are identified and a plan is created to appropriately collect the data. S a m p lin g D esign. D u e to financial and tim e c onstraints, re s earch ers stu dy a subset o f the p o pu latio n o f interest. T h is sm a lle r g ro up is called a sa m p le and must be represen tativ e o f the p o p u latio n o f co ncern . A design for obtain ing a rep resen tativ e sa m p le m u st be outlined. D a ta C o llectio n . T h e data arc collcctcd. O ften this is the m o s t tim ec o n s u m in g and costly part o f a research study. D ata P ro cessin g a n d A n a lysis. D ata are typically edited or verified before being a nalyz ed. V erification review s the data for c o m p le te n e s s and bias. T hen the data are in terpre ted or an aly z e d and e ntered into a c o m p u te r p ro g ra m . R e p o r t W ritin g . T h e final stage is to write a report that clearly details the study, the results o btain ed, and how the results a n s w e r the research question(s).

TYPES OF RESEARCH A N D RESEARCH QU E STIO N S M e d ia m a n a g e rs m u st u nderstand certain basic research c o nce pts to d e v e lo p o b ­ jec tiv e and sy stem atic research o r assess w h e th e r a research firm is needed. M e d ia research e x a m in e s variables or factors, defined as p h e n o m e n a or even ts m easured or m a n ip u lated , such as the ch aracteristics o f a n e w s p a p e r ’s read ers or T V p r o g r a m ’s v iew ers. In d ep e n d e n t variables are varied system atically by the r es e arc h e r to see how they affect d ep e n d e n t variables or w h a t the re s earch er w ishes to explain. F or exam ple, do full- or half-page ads (independent variable = ad size) attract m o re readership (d ep en d e n t variable = n u m b e r o f readers w ho recall inform ation from each dif ferent ad size). The v alues o f the d ep e n d e n t v a ri­ able arc not m an ip u late d , b u t rather m eas u red or ob se rv ed . R eliability o r a reli­ able m ea su re is d ep en d a b le, stable, and co nsistently gives the sam e a n s w e r o ver time. V alidity or a valid m easu re actually m e a s u re s w hat it is desig n ed to m e a ­ sure (W i m m e r & D o m in ick , 2003). A m a n a g e r co nsid ers all these factors w hen e valu a tin g the quality o f research. T h e ty pe o f research p rob lem sug gests w hich m eth o d to use. H av in g k n o w l­ edge o f research m e th o d s en ab le s m an ag e rs to d ecid e b etw een c o m p etin g research pro po sals sub m itted by outside suppliers (including ev alu a tin g the re ­ search design, m eth o d s, q ue stio n n aires, and sam p ling te ch niq ue s used) or design and im p le m e n t research inhouse. M a n a g e r s also m u s t u nd ersta n d and interpret research findings to use the results effectively. C o n sid e r three is sues before d e sign ing a research study. First, how m u ch is already k n o w n about the pro blem at h a n d ? Se co n d , how m u c h in fo rm atio n is

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n eeded abo ut each aud ience m e m b e r? T h ird , h ow im p o rtan t is it th at the study results are gene raliz able or app licable to oth er p eo p le and situatio ns? T h e a n ­ sw ers to th ese q u estio ns direct the res earch e r to so m e types o f research and not others. T he fo llow in g is a d iscussio n o f the differen t catego ries o f research a v a il­ able and so m e co n sid eratio n s for c h o o sin g any o f them . (F or m o re in fo rm atio n on research m eth o d s, c o n d u ctin g research and a n aly z in g research see sources like W illia m s & M o n g e [2001]; W im m e r & D o m in ick [2003].)

Primary Versus Secondary Research P rim a ry research is c o n d u c te d for the specific p u rp o se at hand. It is desig n ed by the res e arch e r to a n s w e r the specific question p osed and is likely to pro vide the n eeded inform atio n. S e co n d a ry research is c o nd uc te d for pu rp o ses o th er than the r e s e a rc h e r’s specific purpose. S e co n d ary research is often c h e a p e r and easier to collect than prim ary research, m ore qu ickly accessible, and pro vides sufficient, if not perfect, in fo rm atio n. F o r e x a m p le , m an y TV stations and ad vertisers use N ielsen ratings b o o k s to evaluate TV p rog ram audiences. M e d ia m a n a g e rs often use seco nd ary research, esp ecially syn dicated research. S y nd icate d research is used to a n sw e r research question s a b o u t the au d ien c e (e.g., a p u b lic a tio n ’s rea dership or the surfers o f a W e b site), the effectiven ess o f an ad vertisin g m e s sa g e (m essa g e or ev aluative research), and the p la c e m e n t o f adv ertisin g by advertisers (adv ertisin g activity or m edia plann ing research). S y n ­ dicated research is c o n d u cte d on an o n g o in g basis by a specialized firm to serve a g rou p o f co m p a n ie s in the industry, rather than co ntracted to m e e t the need s of o ne c o m p a n y . M a jo r pro vid ers o f syn dicated research include N ielsen, A rbitron, M e d ia m a r k R e se a rc h Inc., and S im m o n s M ark e t R esearch B ureau.

Exploratory, Descriptive, and Causal Research E x p lo ra to ry research is c o n d u cte d w hen a r e s e a rc h e r a p p ro ach es a relatively new topic and little inform ation is availab le to gu ide the study. R e search questions m ay not be well defined, and there m a y be m any issues o f interest th at c a n n o t be narro w e d do w n for study. A s such, e xp lorato ry research identifies key variables, issues, o r ideas th at help the resea rche r better u n d erstan d the general problem and define m o re specific research qu estions. A TV n etw o rk m ig ht be in terested in d ev elo p in g a new type o f reality show to attract a y o u n g e r aud ien c e but still m aintain adult interest. R esea rch ers m igh t test p ro g ram c o nc epts by speak in g to sm all n u m b e rs o f parents and children in a focus group. T h is w o u ld allow for free thinking and reveal im po rtant ideas that p ro g r a m m e rs failed to envision. T he e xp loratory research w ou ld identify d irec­ tions fo r d ev elo p in g the new pro g ram and define a m ore focu sed set o f research

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q u e s t io n s to stu d y . E x p lo r a t o r y re s e a rc h u sed to g e n e r a t e a d v e rtis in g m e s s a g e s is c alle d d e v e l o p m e n t a l a d v e r t i s i n g r e s e a r c h ( O ’G u in n , A llen , & S e m e n i k , 2 0 0 3 ). D e s c r i p t i v e re s e a rc h d e s c r ib e s a g ro u p o f p e o p le or a situ a tio n in d e ta il acro s s

a set o f v a ria b le s d e fin e d in the r e s e a rc h q u e s tio n s . A lo cal n e w s p a p e r in tere sted in u p d a tin g its c o m i c s se c tio n m i g h t a n a ly z e w h ic h strips satisfy r e a d e r in terest an d w h ic h to safely d ro p w ith o u t lo s in g re a d e rs. T h e n e w s p a p e r c o u ld p o ll its re a d e r s to id en tify h o w m a n y read e a c h strip an d if r e p l a c e m e n t c o m i c s ex is t th at are p referred . D e s c ri p tiv e re s e a rc h is u s e f u l fo r id e n tif y in g a u d ie n c e s e g m e n ti n g ch a ra c te ris tic s a n d e s t im a ti n g the a c tu a l sizes o f th o s e se g m e n ts . M o s t o f the q u e s t io n s that m a n a g e r s a sk are in h e r e n tly c a u s a l in natu re . W h e n a m a n a g e r c o n s i d e rs strate g ic o p ti o n s , he o r she is really a s k in g , W h ic h o f these stra te g ie s will c re a te o r c a u s e the o u tc o m e I d e s ire ? O n ly c a u sa l re s e a rc h can a n s w e r q u e s t io n s th at sp ecific a lly p o s e a q u e s tio n a b o u t a stra te g y c a u s i n g an o b s e r v a b le e f f e c t on an o u t c o m e — ty p ic a lly a u d ie n c e b e h a v io r . A b ro a d c a s t p r o ­ g r a m m i n g e x e c u t iv e e x p e c t s the d e c is io n o f w h e n to a ir a p ro g r a m to a ffect the size an d c h a ra c te ris tic s o f th a t p r o g r a m ’s a u d ie n c e an d the p ro g r a m s a p p e a ri n g b e fo r e and a fte r it. C a u s a l r e s e a rc h is difficult an d e x p e n s i v e . It r e q u ire s re s e a rc h to be a c c u m u ­ lated o v e r tim e, a ll o w i n g fo r m u ltip le c a u s e s to be e x a m i n e d an d fo r c o m p e t in g th e o r ie s (as to w h y b e h a v io r o c c u rs ) to be c o n tr o lle d . N o s in g le re s e a rc h p ro je c t can esta b lish cau sa lity . B e c a u s e b u s i n e s s d e c is io n s o ften do n o t allo w tim e for c a u s a l re s e a rc h , m e d ia m a n a g e r s u s u a lly a c c e p t the ability to reliab ly p re d ic t b e h a v io r as a r e p l a c e m e n t fo r u n d e r s ta n d in g c a u s a l rela tio n sh ip s .

Designs for D ata Collection O n c e the re s e a r c h e r de fin es the p r o b l e m , r e v i e w s s e c o n d a r y d a ta , an d d e c id e s th a t p r i m a r y d a ta c o lle c tio n is n e c e s s a ry , a stu d y d e sig n is d e v e lo p e d . E x ­ p lo r a to ry re s e a rc h ty p ic a lly u se s q u a l i t a t i v e r e s e a r c h d e s i g n s th a t do n o t rely on the m e a s u r e m e n t o f v a ria b le s , b u t u se s u b j e c ti v e or in tu itiv e d a ta c o lle c tio n or a n a ly s is ( W i m m c r & D o m i n i c k , 2 0 0 3 ). Q u a lit a ti v e re s e a rc h p r o v i d e s a re la tiv e ly q u ick in s ig h t on a p ro b l e m to plan f u r th e r action . Q u a lit a ti v e re s e a rc h ty p ically u se s sm all c o n v e n i e n c e s a m p le s , r a th e r than large r e p r e s e n ta t iv e s a m p le s , so it is n o t u se d as a b asis f o r risk y d e c is io n s . Q u a lita tiv e re s e a rc h t e c h n i q u e s in clu d e f o c u s g r o u p an d d e p t h i n t e r v i e w te c h n iq u e s .

A fo c u s g r o u p u su a lly c o n s i s ts o f 8 to 12 p e o p le w h o r e p r e s e n t the p o p u la tio n o f c o n c e r n an d is fac ilitated by a tr a in e d m o d e r a to r . F o c u s g r o u p s p ro v i d e an o p e n - e n d e d re s p o n s e situ atio n w h e re s y n e r g y a m o n g the p a rtic ip a n ts e n h a n c e s th e g e n e ra t io n o f id eas. D is c u s s io n s ty p ic a lly last b e tw e e n 1 1/2 an d 2 ho u rs . I n ­ fo r m a ti o n c o lle c te d d u ri n g a fo c u s g ro u p is v a lu a b le , b ut it c a n n o t be g e n e ra liz e d to the g r e a t e r p o p u la t io n w ith c o n fi d e n c e d u e to th e s m a ll s a m p le size a n d the u n iq u e n a tu r e o f in teractio n .

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D e p th in t e rv i e w s are o ften u n s tr u c tu r e d p e rs o n a l in t e rv i e w s w h e re a train ed in t e r v i e w e r p r o b e s the s u b j e c t ’s b e h a v io r s an d fe e lin g s fo r up to 2 h o u rs . T h e y g e n e ra te a g re a t d e a l o f in f o rm a t io n , often u n e x p e c t e d , fo r a n y o n e in d iv id u a l. H o w e v e r , th e ir p r o b l e m s in c lu d e s m a ll s a m p le size, lim ite d g e n e ra liz a b ility , and h ig h e r c o s t th a n fo cu s g r o u p s an d o t h e r d a ta - c o lle c tio n m e t h o d s . D e s c ri p tiv e re s e a rc h is often c o n d u c te d u sin g q u a n ti ta t iv e m e t h o d s or a d e ­ scrip tio n o f a p h e n o m e n o n in v o lv in g the specific m e a s u r e m e n t o f v a ria b le s via such m e t h o d s as s u r v e y s o r o b s e r v a tio n a l m e t h o d s ( W i m m c r & D o m in i c k , 2 0 0 3 ). Q u a n tit a ti v e m e t h o d s u se larger, ra n d o m ly c o ll e c te d s a m p le s , a llo w in g r e s e a rc h e rs to g e n e ra liz e the res u lts to o th e r p e o p le an d situ atio n s. T h e s u r v e y or self-r e p o rt m e t h o d a sk s p e o p le to re p o r t th e ir b e h a v io r s , attitu d e s, o p in i o n s , and c h a ra c te ris tic s r e l e v a n t to the m a n a g e ria l p r o b l e m . A s u rv e y c o n s i s ts o f a d m i n i s ­ terin g a q u e s t io n n a i r e sp e c ia lly d e s i g n e d to a n s w e r the re s e a rc h q u e s tio n s . T h e q u e s tio n n a i r e is a d m i n is te r e d face to face th r o u g h a p h o n e in te rv ie w o r W e b site, o r it is m a i le d o r e - m a il e d to su b jects. R e s u lts are then c o m p i le d to d e s c r ib e the re s e a rc h p ro b le m a n d p o te n tia l o u tc o m e s . S u r v e y s are o fte n c ro s s - s e c t io n a l o r p e r f o r m e d at o n e m o m e n t in tim e . A lo n ­ g itu d in a l stu d y is u s e d w h e n d a ta n e e d to be c o lle c te d at m o r e th an o n e p o in t in tim e to e v a lu a te th e r e s e a rc h q u e s tio n . F o r e x a m p l e , the N P D G r o u p (w w w . n p d . c o m ) c o lle c ts in f o r m a t io n fro m its O n lin e P a n e l o f m o r e than 9 0 0 ,0 0 0 w o r ld w id e m e m b e r s w h o a g re e d to p a rtic ip a te in N P D s u r v e y s . N F O W o rl d G r o u p ( w w w . n f o w . c o m ) m a i n ta i n s a large in te ra c tiv e c o m m u n i t y o n lin e p a n el called N F O I n D e p th In te ra c tiv e . O b s e rv a tio n d o e s n ot rely on self-re po rts, b u t o b s e r v e s c o n s u m e r b e h a v io r usin g ob tru siv e ( k n o w n to the o b se r v e d ind iv idu al) or u n o b tru siv e ( u n k n o w n to the o b se r v e d in div idu al) m e th o d s. S o m e w id ely u sed o b se rv a tio n a l data-collectio n m e t h o d s in c lu d e s c a n n e r data and tra c k in g o f In te rn e t u s e r s ’ surfing b e h a v io r. S c a n n e r da ta are u sed at p o in t-o f- p u rc h a s e sites su ch as g ro c e r y stores to collect in fo rm a tio n on p u rc h a s e b e h a v io r . M a n y g ro c e r y c h a in s p ro v id e p referre d c u s ­ t o m e r card s tha t are sc a n n e d each tim e a p u rc h a s e is m a d e . T h e c u s t o m e r rece iv es a c o u p o n , d is c o u n t, o r o th e r re w a rd w h e n the card is used . B e c a u s e the c u s t o m e r p r o v id e d d e m o g r a p h ic in f o rm a tio n to the g r o c e r to re c e iv e the c ard , the list o f p u rc h a s e s is a ss o c ia te d w ith th at i n d i v id u a l’s d e m o g r a p h ic profile. C o n ten t analysis p ro vides an objectiv e and system atic m e a n s to investigate m ed ia content. It is used to describe m es sa g e co m p o sitio n and content. F o r e x a m ­ ple, c o n ten t analysis is often u sed to e x a m in e ty p o g ra p h y , layout, an d m a k e u p in n ew sp a p e rs and m ag az in e s. It is u sed to study h o w the m e d ia portray m inority grou ps, d ifferences in n e w s co v era g e , an d the level o f v iolence in T V p ro g r a m m in g . T h e a bility o f d e s c r ip ti v e re s e a rc h to a c c u ra te ly d e s c r ib e a large p o p u la tio n relies on tw o e le m e n ts o f re s e a rc h . F irst, the s a m p le s tu d ie d m u s t be ra n d o m ly sele cted fro m th e la r g e r p o p u la t io n the s a m p le r e p r e s e n ts to p r e v e n t b ia s es r e ­ lated to in c o m e , g e n d e r, e th n ic b a c k g r o u n d , and so on. E v e r y s u b je c t s h o u ld h a v e an e q u a l c h a n c e o f b e in g se le c te d so n o g r o u p o r ag e is o v e r r e p r e s e n t e d .

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R a n d o m s a m p li n g a llo w s r e s e a rc h e rs to re d u c e and e s t im a te the p ro b a b ility th at the b ia s e s exist. S e c o n d , a large s a m p le size is n e e d e d b e c a u s e the la r g e r a r a n d o m s a m p le , the less lik ely it is to be b ia s e d . M o s t s a m p le s s h o u ld be larg er th an 4 0 0 , and a s a m p le o f m o r e th an 1,000 w o r k s w e ll fo r r e p r e s e n ti n g m illio n s o f peo p le . C a u s a l re s e a rc h is p e r f o r m e d u sin g la b o r a to r y e x p e r i m e n t s w h e n c o n tr o l o v e r e x tr a n e o u s c o n d it io n s is im p o rt a n t a n d feasible. F o r e x a m p l e , the s a m e n e w s p a ­ p e r life sty le se c tio n is te s te d , w h e r e b y o n e g r o u p o f in d iv id u a ls re a d s o n e v e r ­ sion and a s e c o n d g ro u p re a d s a s e c o n d v e rs io n in a c o n tr o ll e d setting w ith o u t disru p tion s. T h is m a k e s it m o r e likely th at d iffe ren t reaction s to the tw o sections are du e to the lifestyle c o n te n t an d n ot so m e ex te rn a l factor. H o w e v e r, ex p o su r e to the lifestyle section in a lab ora tory setting is c o n triv e d an d m a y d iffer from readin g it at h o m e , resu ltin g in a d ifferen t o r less than natural reaction to the section. F ield e x p e r i m e n t s are c o n d u c te d in n atural se ttin g s to m i n im iz e the d i s a d v a n ­ tages o f e x p e rim e n ts . F o r e x a m p l e , d e liv e rin g on e versio n to res id en ts in o ne g e o ­ g ra p h ic reg io n o f a city an d a s e c o n d versio n in a n o th e r re g io n tests tw o vers io n s o f a n e w s p a p e r lifestyle sectio n. R e a d e r s ’ re a c tio n s are m o n ito r e d in bo th re g io n s to d is c o v e r w h ic h sectio n w a s p re f e rre d m o r e by w h ic h read ers. R eal-life c o n d i ­ tions are p res e n t, y e t a field e x p e r i m e n t lac k s r e s e a rc h e r c o n tro l, a llo w in g m a n y factors to influ en ce the o u tc o m e . T h e re s e a r c h e r m a y n e v e r be sure th at the r e a d ­ e r s ’ re a c tio n s v aried on ly b e c a u s e o f d if fe re n c e s in the tw o lifestyle section s. A n e x p e r i m e n t a l d e sig n iso la tes the c a u s e - e f f e c t re la tio n s h ip b e tw e e n the m a n a g e r ia l fa c to r o f c o n c e rn (the in d e p e n d e n t v a ria b le ) an d the d e s ire d a u d ie n c e b e h a v io r a l o u tc o m e (the d e p e n d e n t v a ria b le ) to h a v e in tern a l v alid ity . W h e n an e x p e r i m e n t h as in te rn a l va lid ity , the p ro b a b ility is h ig h that o n ly th e i n d e p e n d e n t v a ria b le c a u s e d the d e p e n d e n t v a ria b le to c h a n g e . A n e x p e r i m e n t h a s e x te r n a l v a lid ity if its res u lts ca n be g e n e r a l iz e d to o th e r situ a tio n s a n d p eo p le . T o in ­ c re a s e the li k e lih o o d o f e x te r n a l valid ity , r a n d o m l y s e le c t the s a m p le u sed in the e x p e r i m e n t fro m the larg er p o p u la tio n . Y o u c a n n o t h a v e p e rf e c t in tern al an d e x te r n a l v a lid ity in the s a m e e x p e r i ­ m en t. In te rn a l valid ity re q u ire s c o n tr o l o v e r all fa c to rs e x t r a n e o u s to the i n d e ­ p e n d e n t a n d d e p e n d e n t v a ria b le s o f c o n c e r n . C o n tr o l le d lab s itu atio n s e n h a n c e in te rn al valid ity, but d e c r e a s e ex te rn a l v alid ity b y re m o v in g o u ts id e facto rs. E x ­ ternal v alid ity re q u ire s th a t e x tr a n e o u s v a ria b le s n o t be c o n tr o ll e d as in field e x ­ p e ri m e n t s . H o w e v e r , o n c e e x t r a n e o u s v a ria b le s are a ll o w e d to fluctu ate, internal v a lid ity su ffers. T h e r e is a lw a y s a tr a d e - o f f b e tw e e n in tern a l an d e x te rn a l v a li d ­ ity, so the re s e a rc h o b je c t iv e s s h o u ld g u id e the b a la n c e b e tw e e n the tw o.

Basic Versus Applied Research B asic re s e a rc h iden tifies g e n e ra l p rin c ip le s o f p ra c t ic e and a n s w e r s g e n e r a l q u e s ­ tion s fo r m e d i a m a n a g e r s . F o r e x a m p l e , a q u e s t io n s u c h as, “ W h i c h typ e o f

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ad vertisin g strategy creates a m o re positive attitude tow ard the advertised brand: c o m p a r a tiv e or sin g le -sid ed ?” is b e st a n sw e re d using a basic research a pproach. T h is qu estion ap pears specific, but it is g en eral b ecau se the results o f a study d e ­ signed to a n sw e r this questio n co uld prov ide in fo rm atio n to apply to a variety o f brand s, p rod uct categories, o r adv ertising m edia. B asic research h elps a m a n a g e r d ev elo p principles o f practice to use o v e r time. A pp lied research is c o n d u c te d to obtain in fo rm atio n for a specific decision in a u niq ue situation. F o r e x am p le , an onlin e n e w s p a p e r in N ew Y o rk m ig h t c o n ­ d uct a study to identify its r e a d e r s ’ reactions to cither publish ing in a c o m m e m o ­ rative edition arch iv al ph oto s o f the B ro o k ly n D o d g ers and N ew Y o rk G iants b aseb all tea m s o r m a k in g the p h o to s availab le online. A p p lied research takes f e w e r reso urces than basic research and a n sw e rs the specific question at hand, but is o f lim ited use in o th er situations.

TYPES OF APPLIED M E D IA RESEARCH M ed ia co m p a n ie s ask sim ilar applied research question s regardless o f the n ature o f the c o m p a n y . T he follo w in g discusses five basic types o f applied m ed ia re­ search, including how the in fo rm ation gained is used by advertise rs and how it is used to m ark e t the m ed ia c o m p a n y .

Audience Research: Secondary Data A u d ie n c e research e x a m in e s the ch aracteristics o f p resen t and p oten tial target au dien c e s. A c o m p a n y can p erfo rm p rim ary au d ien c e research o r use the m a n y seco nd ary, syn dicated sou rces o f a u d icn c c data. A u d ic n c c research often iden ti­ fies the d e m o g ra p h ic , g eo g rap h ic, and p s y ch o g ra p h ic characteristics o f potential au dien ces. D e m o g ra p h ic characteristics includ c age, ed ucatio n, g en d e r, race, marital status, occupation, and incom e. A u dien ces arc segm ented by g eographies including region o f the country, state, city, or neig hborhood. G eo d em o g rap h ic seg­ mentation uses data from the U.S. C ensus B ureau and zip codes to identify n eigh ­ bo rh oo ds around the country that share d em og raph ic characteristics ( O ’G uinn, A llen, & S e m e n ik , 2003). P s y c h o g ra p h ic s d escrib e the in d iv id u a l’s lifestyle, activities, interests, and op in io ns. T h e V A L S 2 (for values and lifestyles) typ olog y divides au dienc e m e m b e rs into eigh t categ ories b ased on d em o g r a p h ic and p s y c h o g rap h ic p ro ­ files; it cate go rizes c o n s u m e rs by reso urces (in clu ding age, in com e, edu cation , intelligence, self-confidence, health, and en erg y level) and self-orientation (or m o tivated by principles o r idealized criteria, status, o r p ro d u cts that d em o nstra te success, or action or a desire for activity, variety, and risk taking). T h e V A L S 2

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225

ty p o l o g y a n d s u r v e y are lo cate d o n lin e ( w w w . s r i c - b i . c o t n / V A L S / ). T h e L ife s ty le M a r k e t A n a ly s t ( w w w . s r d s . c o m / f r o n l M a t t e r / i p s / l i f e s l y l e ) p ro v i d e s d e m o g r a p h ic a n d p s y c h o g r a p h ic data fo r cities a n d c o u n ti e s n a ti o n w i d e and lifesty le profiles o f m o r e than 7 0 c o n s u m e r in tere st g ro u p s . M a n a g e r s o f m e d i a o u tle ts s h o u ld learn h o w a d v e rtis e rs use s e c o n d a r y data to d e v e lo p e f f e c tiv e w a y s to sell tim e o r s p a c e to a d v e rtise rs. A d v e r ti s e r s and m e d i a p la n n e r s a n a ly z e s e c o n d a r y d ata to d e c id e h o w to s p e n d an ad v e rtisin g b u d g e t, h o w m u c h th e ir c o m p e t it o r s s p e n d in m a j o r m e d i a , h o w m a n y in th e ta r ­ g et a u d ic n c c s h o u l d sec the ad, an d w h e r e an d w h e n to p lace the a d s to e f f e c ­ tively r e a c h the targ e te d a u d ie n c e . T h e m e d i a p la n n e r a n a ly z e s s e c o n d a r y data to s elect v e h ic le s w h e r e to p la c e the a d s (e.g., T h e N e w Y o r k T i m e s is a v e h ic le in the n e w s p a p e r m e d i u m ) . T h e m e d i a b u y e r p u r c h a s e s tim e a n d s p a c e in the v e h i ­ cles th a t efficien tly reach the ta r g e t a u d ie n c e . M e d i a firm s u se th e s e s a m e s e c ­ o n d a r y d a ta to id e n tify th eir a u d ie n c e s an d th o s e o f c o m p e t i n g m e d i a ou tlets.

U s in g A u d i e n c e R e s e a r c h .

S i m m o n s M a r k e t R e s e a r c h B u re a u ( S M R B ;

w w w . s t n r b . c o m ) and M c d i a m a r k R e s e a r c h Inc. ( M R I ; w w w . m r i . c o m a n d w w w . m r i p l i t s . c o m ) rep ort u sage rates o f n ational m ed ia and b ran ds to identify heavy,

m e d iu m , an d light users o f a pro duct. T h e inform a tio n allow s advertisers and m ed ia m a n a g e r s to define a ta r g e t s e g m e n t by d e m o g r a p h i c s , g e o g r a p h i e s , a n d m e d ia u sag e hab its. A P u b lic B r o a d c a s t in g S y s te m ( P B S ) station m a n a g e r c o u ld use M R I d a ta to id e n tify an d d e s c r ib e the targ e t s e g m e n t o f m a j o r c o n tr ib u t o rs (or ad u lts d o n a ti n g $ 5 0 o r m o r e to p u b lic T V — see T a b le 9.1). T h e p o p u la t io n base c o lu m n an d total row s h o w th ere are 1 9 9 ,4 3 8 ,0 0 0 a d u lts in the U .S . C o l u m n A, a n d the total ro w s h o w the p ro j e c te d e s t im a te o f 6 ,0 6 6 ,0 0 0 a d u lts w h o c o n ­ trib u ted $ 5 0 or m o r e to p u b lic T V in the last 12 m o n t h s . C o lu m n A an d the G r a d u a te d C o ll e g e ro w s h o w an e s t im a te d 2 ,8 8 2 ,0 0 0 o f m a j o r c o n tr ib u t o rs to p u b lic T V are c o lle g e g ra d u a t e s . C o l u m n B and the G r a d u a te d C o ll e g e ro w sh o w th at 4 7 .5 % o f m a j o r c o n tr ib u t o r s are c o lle g e g ra d u a t e s (o r 2 , 8 8 2 , 0 0 0 m a j o r c o n ­ trib u to rs w h o are c o lle g e g r a d u a t e s / 6 ,0 6 6 ,0 0 0 m a j o r c o n tr ib u t o r s in the U .S . = 4 7 .5 % ) . C o l u m n C and the G r a d u a te d C o ll e g e row s h o w tha t 6 .4 % o f c o lle g e g ra d u a t e s are m a j o r c o n tr ib u t o rs to p u b lic T V (o r 2 , 8 8 2 , 0 0 0 m a j o r c o n tr ib u t o rs w h o are c o lle g e g ra d u a t e s / 4 4 , 9 4 0 , 0 0 0 U .S . c o lle g e g r a d u a t e s = 6 .4 % ) . (A n a s ­ te risk n e x t to a c o lu m n in d ic a te s f e w e r th a n 5 0 su b je c ts r e s p o n d e d , so c o n s i d e r th ese re s u lts c a u tio u sly .) C o l u m n D an d the G ra d u a te d C o ll e g e ro w s h o w an in d e x o f 211 fo r m a j o r c o n tr ib u t o rs w h o are c o ll e g e g ra d u a te s . M a n y s e c o n d a r y re s e a rc h re p o r ts use i n ­ d e x e s so th ey arc n o w e x p la in e d . A n ind ex s h o w s a re la tio n s h ip b e tw e e n tw o p e rc e n t a g e s , as s h o w n in the fo l lo w in g f o r m u la fo r c a lc u la tin g in d ex n u m b e r s:

P e rc e n t a g e o f c o n s u m e r s in a d e m o g r a p h i c s e g m e n t In dex N u m b e r = --------------------------------------------------------------------------------P e r c e n t a g e o f p o p u la t io n in the s a m e s e g m e n t

X 100

226

C H A P TE R 9

TABLE 9.1 MR I Data on M a j o r C o n trib u to rs to P ublic TV C o n t r i b u t e d $ 5 0 O r M o r e P a s t 12 M o n t h s

* Popu­

* A

B

C

la tio n

C ontr.

P ercen t­

P ercen t­

R ep o rt B ase: A d u lts

Base:

$50 or

age

age

M e d ia m a r k R ec re a tio n V o lu m e

A d u lts

M ore

Down

A cross

(000)

(000)

199438

6066

to P u b l i c B r o a d c a s t T e l e v i s i o n

Spring 2000 C o p y r i g h t 2 0 0 0 , M e d i a m a r k R e s e a r c h In c . ( A d d 0 0 0 to e n d o f n u m b e r s in Pop. & A C olum ns) * S a m p l e s i z e f o r t h i s i te m is l e s s t h a n 5 0

T o ta l

100

3

100

D em o g rap h ics Men

9 5691

2617

43.1

2.7

90

103747

3449

56.9

3.3

109

G r a d u a t e d c o ll e g e

44940

28 8 2

47.5

6.4

21 1

A tte n d e d c o lle g e

52878

1276

21

2.4

79

G r a d u a t e d h ig h s c h o o l

66360

1298

2 1.4

2

64

D id no t g r a d u a t e h ig h s c h o o l

35260

610

10.1

1.7

57

W om en

* 18-24

2 5 6 91 *

164

2.7

0.6

21

25-34

39066

553

9.1

1.4

47

35-44

4 4791

1 149

18.9

2.6

84

45-54

34774

1568

25.9

4.5

148

55-64

2271 1

1264

20.8

5.6

183

65 o r o v e r

32404

1368

2 2 .6

4.2

139

P r o f e s s io n a l

20825

1045

17.2

5

165

E x e c u ti v e /A d m i n . /M a n a g e r ia l

19692

1205

19.9

6.1

201

C l e r i c a l/ S a le s /T e c h n ic a l

37625

860

14.2

2.3

75

H /D I n c o m e $ 7 5 .0 0 0 o r m o re

48259

3065

50.5

6.4

20 9

H /D I n c o m e $ 6 0 , 0 0 0 - $ 7 4 . 9 9 9

22279

571

9.4

2.6

84

H /D I n c o m e $ 5 0 , 0 0 0 - $ 5 9 , 9 9 9

19004

476

7.8

2.5

82

H /D In c o m e $ 4 0 , 0 0 0 - $ 4 9 , 9 9 9

21816

510

8.4

2.3

77

H /D In c o m e $ 3 0 , 0 0 0 - $ 3 9 , 9 9 9

24055

420

6.9

1.7

57

H /D In c o m e $ 2 0 , 0 0 0 - $ 2 9 , 9 9 9

25327

411

6.8

1.6

53

H /D I n c o m e $ 1 0 , 0 0 0 - $ 19,999

24406

444

7.3

1.8

60

*H /D I n c o m e L e s s th a n $ 1 0 ,0 0 0 M a r ita l Status: M a r r ie d

14292* 11 40 55

168

2.8

1.2

39

4385

72.3

3.8

126

H o u s e h o l d size: 1 P erso n

26674

75 2

12.4

2.8

93

H o u s e h o l d size: 2 P e rs o n s

68888

25 9 2

42.7

3.8

124

H o u s e h o ld size: 3 o r M o r e

1 03 87 6

27 2 2

4 4.9

2.6

86

15224*

230

3.8

1.5

50

A n y C h ild in H H : 2 - 5 Y e a rs

29840

60 2

9.9

2

66

A n y C h ild in H H : 6 - 1 1 Y e a rs

40268

899

14.8

2.2

73

A n y C h ild in H H : 1 2 - 1 7 Y e a rs

39005

94 6

15.6

2.4

80

* A n y C h ild in H H : U n d e r 2 y e a rs

G e o g ra p h ie s M a r k e t i n g R eg.: N e w E n g la n d

10172

496

8.2

4.9

160

M a r k e t i n g R eg .: M i d - A tla n t ic

32601

1066

17.6

3.3

107

M A R K E TIN G A N D RESEARCH

227

TABLE 9.1 C o n tin u e d M a r k e tin g R eg .: E a st C e n tra l

26616

6 67

11

2.5

82

M a r k e tin g R eg .: W e s t C e n tra l

30192

7 82

12.9

2.6

85

M a r k e t i n g R eg .: S o u th e a s t

38789

8 66

14.3

2.2

73

M a r k e tin g R eg .: S o u th w e s t

22644

62 8

10.4

2.8

91

M a r k e tin g R eg .: Pacific

38424

1561

25.7

4.1

134

M S A C e n tr a l C ity

67669

1875

30.9

2.8

91

M S A Suburban

93169

33 3 7

55

3.6

118

N on-M SA

38599

8 54

14.1

2.2

73

52

0.9

4.7

155

M a g azin e R ead in g *A m e ric a n W a y

1 108*

A rc h it e c tu r a l D ig e s t

4368

♦ A tla n tic M o n t h ly ♦Audubon

99 8 + 1546*

321

5.3

7.4

24 2

164

2.7

16.5

54 2

170

2.8

11

3 62

94

1.6

8.4

275

♦ B a r r o n ’s

1 127 ♦

B o n A p p e tit

5268

37 9

6.3

7.2

23 7

♦ D e l t a 's S K Y M a g a z i n e

2465^

116

1.9

4.7

154

21086

7 37

12.1

3.5

115

4472

2 99

4.9

6.7

2 20

F a m i ly C ircle F o rb e s F o rtu n e

3722

281

4 .6

7.5

248

G ourm et

4724

320

5.3

6.8

22 2

♦ H e m i s p h e r e s (U n ite d )

1507 ♦

116

1.9

7.7

25 4

♦ K i p l i n g e r ’s P e rs o n a l F in a n c e

2969^

194

3.2

6.5

215

* L o s A n g e l e s T im e s M a g a z i n e M a r t h a S te w a r t L iv i n g ♦ M e t r o p o li ta n H o m e M o d e r n M a tu rity M oney N a tio n a l G e o g r a p h ic N a tio n a l G e o g r a p h i c T r a v e l e r N ew sw eek * N e w Y o rk M a g a z i n e

3582^ 10491 2548^

211

3.5

5.9

194

497

8.2

4.7

156 2 16

167

2.8

6.6

15117

6 76

11.1

4.5

147

7507

4 90

8.1

6.5

215

30258

1369

2 2.6

4.5

149 20 6

4310

270

4.5

6.3

1 9130

1038

17.1

5.4

178

87

1.4

8.1

26 6 3 79

1074^

N e w Y o rk T im e s (D a ily )

2769

3 19

5.3

11.5

N e w Y o rk T im e s (S u n d a y )

3939

37 9

6.3

9.6

317

The N ew Y orker

2767

3 37

5.6

12.2

401

9.4

30 9

143

2.4

P e o p le

♦N orthw est W orld T raveler

34469

1037

17.1

3

R e a d e r ’s D ig e s t

44264

1515

25

3.4

S m i th s o n ia n

7060

630

10.4

8.9

293

♦ S o u th w e s t S p irit

1878^

135

2.2

7.2

237

2.3

77

1 5 17 +

99 113

S p o rts Illu strated

20833

487

8

T im e

21663

1084

17.9

5

165

4783

3 12

5.1

6.5

215

T ra v e l & L e isu r e T V G u id e

32692

741

12.2

2.3

75

U .S. N e w s & W o r l d R e p o r t

1 0070

585

9.6

5.8

191

228

CHAPTER 9

TABLE 9.1 C o n tin u ed

C ontribute d $ 5 0 O r M o re P ast 12 M onth s to P ublic B ro a d c a st Television R eport Base: A dults M e d ia m a r k R ecreation Volume Spring 2000 C o p y rig h t 2000, M e d ia m a r k R esearch Inc.

* Popu­

lation

♦A Contr.

Base:

$50 or

A du lts (000)

M o re (000)

3588

391

B

C

D

P e r c e n t­

P e r c e n t­

Index

age D ow n

A c r o ss

6 .4

age

( A dd 0 00 to end o f n u m b e rs in Pop. & A C o lu m n s) * Sa m p le size f o r this item is less than 50 W all Street Journal

10.9

358

♦ W ashington Post (Sunday)

2536^

162

2.7

6 .4

210

♦W orking M oth e r

2430^

137

2.3

5.6

185

S o the 211 in d e x r e p r e s e n ts the 4 7 .5 % o f m a j o r c o n tr ib u t o r s w h o a re c o lle g e g ra d u a t e s d iv i d e d by 2 2 .5 % o f all U .S . a d u lts w h o are c o ll e g e g r a d u a t e s (or 4 4 ,9 4 0 ,0 0 0 a d u lt U .S . c o lle g e g r a d u a t e s d iv i d e d b y the total o f 1 9 9 ,4 3 8 ,0 0 0 a d u lts in the U n ite d S tates) or: 4 7 .5 % o f m a j o r c o n tr ib u t o r s arc c o lle g e g ra d u a t e s 211 = ---------------------------------------------------------- — -------------- X 100 2 2 .5 % o f U .S . a d u lts are c o lle g e g ra d u a t e s S is s o rs an d B a ro n (2 0 0 2 ) said in d e x e s p ro v i d e a c o m m o n m e t h o d f o r c o m p a r ­ ison. A n in d e x o f 100 is e q u a l to the a v e ra g e , 150 is 5 0 % a b o v e a v e ra g e , and 7 0 is 3 0 % b e lo w a v e ra g e . S o the 211 in d e x tells us th at c o lle g e g ra d u a t e s are 111% m o r e likely th an the a v e r a g e U .S . a d u lt to be m a j o r p u b lic T V c o n t r i b ­ utors. In d ex n u m b e r s are v ie w e d as c e n tra l te n d e n c ie s su ch as a v e r a g e s or m e a n s . A n in dex , like an a v e ra g e , d e s c r ib e s the g ro u p as a w h o le ra th e r than o n e p erso n . D e m o g r a p h i c o r o t h e r c h a ra c te ris tic s h a v in g i n d e x e s o v e r 100 arc n o t n e c e s ­ sarily the b e s t to select. C o n s i d e r s e g m e n t size, level o f u se o r c o n s u m p ti o n , a n d o th e r p r i m a r y o r s e c o n d a r y re s e a rc h w h e n se le c tin g a ta r g e t s e g m e n t. S o m e ­ tim e s sev eral c a te g o rie s o f the s a m e d e m o g r a p h i c o r c h a ra c te ristic are in c l u d e d in the ta r g e t s e g m e n t. F o r e x a m p l e , the 55 to 64 ag e g r o u p h a s the h ig h e s t index o f 183 and c o m p r i s e s 2 0 .8 % o f m a j o r c o n tr ib u to rs . Y e t if the m a n a g e r o nly t a r g e te d 5 5 - to 6 4 -y e a r - o ld s , m o s t m a j o r c o n tr ib u t o r s fro m the ta r g e t s e g m e n t w o u ld be o m itte d . By a d d in g m a j o r c o n tr ib u t o r s a g e s 45 to 54 (2 5 . 9 % ) and 65 an d o l d e r ( 2 2 .6 % ) , the targ et s e g m e n t size is i n c r e a s e d to 6 9 .3 % o f all m a j o r c o n tr ib u t o r s (o r 2 0.8 + 2 5.9 + 2 2 . 6 — o n ly a d d m u tu a lly e x c lu s iv e c a t e ­ g o rie s w ith in the s a m e c h a ra c te ris tic s u c h as ag e w h e n u s i n g M R I ; S is so rs & B a ro n , 2 0 0 2 ).

M A R K E T I N G A N D RESEARCH

229

W h ich characteristics best e x e m p lify the national target s e g m e n t o f m ajor c on trib uto rs to public T V ? T he M R I data in T able 9.1 su gg est m ajo r c ontributors are college g rad ua tes ages 45 and o lder w h o h av e annual h o u seh o ld in c o m es of 57 5 ,0 0 0 o r more. T h ey tend to be m arrie d, but have no child ren at h o m e, w o rk in adm in istrativ e o r profession al o ccu p atio n s, and live in the sub urbs o f m ajo r cities. M a jo r co n trib u to rs ap p ea r m ost likely to live in the N ew E n g lan d and Pacific m a rk e tin g regions. A lth o u g h th ese are national data, a local public TV m a n a g e r cou ld co n d u ct research to assess w h e th e r th ese d e m o g r a p h ic c h a rac ter­ istics hold true locally. F o r e x a m p le , the s ta tio n ’s printed or on lin e co ntrib utio n fo rm s cou ld include a b rie f d em o g r a p h ic and m ed ia usage qu estio nn aire for o b ­ taining local data. M a n a g e r s o f m ed ia outlets shou ld un de rstan d reach and freq u en cy b ecause advertisers and m ed ia plan ners use th ese c o n ce p ts w hen d ev elo p in g m edia sch ed ule s or plans. R each refers to the p erce nta ge o f the target s e g m e n t exp osed to a vehicle, ad, o r pro g ram at least o n ce in a given period. R each is a m e a s u re o f dispersion or h ow w id ely the m e s sa g e is received. F req u en cy is a m easu re o f repetition and refers to h ow often the au dien ce seg m e n t is reach ed on average. A n ad ve rtise r m ay select a p articular m ed iu m o r co m b in a tio n o f m ed ia based on w h e th e r the pro d u ct is sold to the public at large or a specialized se g m e n t (such as m a jo r c o ntribu to rs to public T V). A dvertisers and m edia planners also consider cost per thousand (C P M ) when m aking advertising p lace m ent decisions. C P M is the cost to deliver 1,000 people o r households to an advertiser. It is an estim ate o f media efficiency for reaching the desired segm ent. C P M s are used for interm edia (or co m paring different media) and intram edia (or com pariso ns am o ng vehicles in the same class like new sp apers or m agazines) com parisons. A lthough interm edia co m parison s are m ade to select am o ng different m edia classes, re m e m b e r these m e dia are not directly com parable in terms o f how the audience is m easured and co m m ercial impact. Intramedia C P M s co m p are ads o f the sam e sizes and types (e.g., co m p a re full-page, four-color ads a m o n g m agazines o r co m p are 30-sccond ads a m o n g prim etim e TV shows). T he basic C P M formulas are as follow s (Sissors & Baron, 2002). F or N ew spapers

CPM =

C ost o f ad X 1000 -------------------------C ircu lation

F o r P rin t V ehicles W h e n A u d ie n c e D ata A r e A va ila b le

C o st o f one pag e black & w hite ad (or ap p ro p riate size and color) X 1000 C P M = ----------------------------------------------------------N u m b e r o f p ro sp ects (or readers in the target seg m en t) reached

230

CHAP T E R 9

F o r Broadcast M edia (B a sed on A u d ie n c e or H ouseholds R eac h ed by a Given Program or in a Given D aypart or Standard B roadcast D aytime Period C o s t o f 1 u nit o f tim e (e.g., :3 0 - S e c o n d sp o t) X 1000 CPM = N u m b e r o f h o u s e h o l d s o r p e rs o n s re a c h e d by a g iv e n p r o g r a m , d a y p a r t or tim e p e rio d A d v e rtisers and m e d ia p lan n ers e v alu a te factors includ ing C P M s , reach, fre­ q u e n c y , indexes, n u m b e r and p e rc e n ta g e o f target readers, and targ et su b s e g m e n ts to select the m o s t effective mix o f v ehicles to reach as m a n y diffe ren t m e m b e rs o f the target se g m e n t as possible. A m e d ia p lan n er co nsid erin g w h ere to place ads for a firm that w ants to inform m a jo r co ntrib u to rs o f its sp o n s o rsh ip o f P B S p ro g r a m s cou ld use the M R ! data to select particu lar vehicles. W h ic h c o m b in atio n o f p u b li c a ­ tions ap p e ars to b e st reach m a jo r con trib u to rs to public T V ? An estim ated 5.6% or 3 3 7 ,0 0 0 o f m a j o r co n trib u to rs read T h e N e w Y o r k e r with an index o f 401. S m i t h ­ s o n i a n with an index o f 293 re ach es 10.4% or 6 3 0 ,0 0 0 m a jo r con trib u to rs and

p ro b ab ly b ro a d e n s reach b e c a u se o f its d ifferen t g eo g ra p h ic disp ersion . By ad ding T h e W a l l S t r e e t J o u r n a l w ith an index o f 358 that reac h e s 6 .4% o r 3 9 1 ,0 0 0 m ajo r

co ntribu tors to the m e d ia sch edu le, the p la n n e r ex te n d s reach to b u sin ess e x e cu tiv es and th o se w ith an interest in business. B y ad d in g B o n A p p e t i t w ith an in d ex o f 237 and rea dersh ip o f 6.3% or 3 7 9,0 00 , the p la n n e r re ach es m a jo r con trib uto rs w ith e p i­ curean interests. O b v io u sly s o m e m a jo r co ntrib u to rs m ay su b scrib e to m o r e than o n e o f these v ehicles, in cre asing the fre q u e n c y o f e x p o s u r e to the ad or cam p a ig n . C P M s h elp e n s u r e that the m e d i a pla n o r sc h e d u le is as co st-efficie nt as p o s s i­ ble in re a c h in g the d esire d ta rg et se g m e n t. A s s u m e th at the ad v e rtise r g a v e the m e d ia p la n n e r a lim ited b u d g e t so c h o ic e s m u s t be m a d e on m a x i m i z in g reach a m o n g v a rio u s ta rg et s u b s e g m e n ts . T h e

m e d ia p la n n e r d e c id e s a b u sin e ss-

o rien ted m a g a z in e is n ee d e d b e c a u s e m a n y in the target a u d ie n c e w o rk in a d m i n ­ is trative o c c u p a tio n s . F o r b e s w ith an in d e x o f 2 2 0 re a c h e s 2 9 9 ,0 0 0 or 4 .9 % o f m a j o r c o n tr ib u to rs (see w w w . f o r b e s . c o m , w w w . f o r b e s . c o m / f d c / a d v e r t i s e . s h t m U or w w w . f o r b e s m e d i a . c o m for rate cards, an e d ito rial ca le n d a r, d e m o g r a p h ic i n f o r m a ­

tion, and a d v e rtis e r in fo rm a tio n ). M a j o r c o n tr ib u to rs c o m p r is e 6 .7 % o f rea d e rs o f F o r b e s , w h ic h c h a rg e s a b o u t $ 7 7 ,7 6 0 for o n e fu ll-p ag e , fo u r -c o lo r ad. F o r ­ tu n e

w ith an in d ex o f 248 re a c h e s 2 8 1 ,0 0 0 or 4 .6 % o f m a j o r c o n tr ib u to rs

( w w w . f o r t u n e . c o m o r see the print m e d ia k it at w w w . f o r t u n e . c o m / i n d e x w . j h t m l ?

c h a n n e l = / h t m l / m e d i a k i t . h t m l ) . M a j o r c o n tr ib u to rs c o m p r is e 7 .5 % o f re a d e rs o f F o r t u n e , w h ic h c h a rg e s a b o u t $ 7 8 ,2 0 0 for o ne fu ll-p age , fo u r -c o lo r ad. Y e t ho w

d o these v e h ic les stack up in te r m s o f c o st e ffic ie n c y ? T h e in tra m e d ia C P M s for a fu ll-p ag e , fo u r -c o lo r ad in ea ch b u s in e s s m a g a z in e ve h icle are the follow in g.

F orb es C P M $ 7 7 , 7 6 0 X 1000 F u ll -P a g e , 4 - C ad = -------------------------------------------------------- = $ 2 6 0 .0 6 2 9 9 ,0 0 0 m a j o r c o n tr ib u t o r s re a c h e d

M A R K E T I N G A N D RESEARCH

231

F o r tu n e C P M $ 7 8 , 2 0 0 X 1000 F u ll -P a g e , 4 - C ad = --------------------- ---------------------------------- = $ 2 7 8 .2 9 2 8 1 , 0 0 0 m a j o r c o n tr ib u t o r s re a c h e d A s s u m in g there are no o th e r im p o rt a n t re a s o n s fo r u sin g e ith e r m a g a z in e , the C P M a n a ly s is s u g g e s ts F o r b e s is the m o r e c o st-effic ien t buy. T h e c o s t to reach 1,000 m a j o r c o n tr ib u to rs is $ 1 8 .2 3 less than if F o r t u n e w e re used . A lth o u g h F o r b e s h a s a lo w e r in d ex (2 2 0 vs. 248 for F o r t u n e ), it a ctu a lly re a c h e s m o r e

m a j o r c o n tr ib u to rs than F o r t u n e . So if reach is a m a j o r go al in the m e d ia plan, F o r b e s is selected b e c a u s e it is a m o re co st-efficien t b u y, re a c h e s m o r e m ajo r

co n trib u to rs, and the ad co sts less than an ad o f the s a m e size an d type in F o r t u n e . A d v e rtise rs and m e d ia p lan n ers a n a ly z e the v ie w in g an d listening levels o f v a r­ ious p r o g r a m s on d iffe ren t stations an d ch a n n e ls to d e c id e w h ic h b ro a d c a s t v e h i­ cles b e st reach the target se g m e n t. In m a n y m a r k e ts, the level o f p ro g ram v iew in g an d listening, as w ell as d e m o g r a p h ic an d o th er data, are m e a s u re d fou r tim es each y e a r by N ielsen ( w w w . n i e l s e n m e d i a . c o m ) o r A rb itro n ( w w w . a r b i t r o n . c o m ) during the s w e e p s p erio ds. A rb itro n and N ielsen assign stations to on ly o n e v iew in g or listening m a r k e t area w h e re they receive the largest au d ie n c e share. N ielsen calls these n o n o v e rla p p in g , m utu ally e x c lu s iv e m a r k e t areas c o m p r is e d o f co u n tie s g r o u p e d aro u n d cities o r to w ns, d e s ig n a te d m a r k e t areas (D M A s ) . E a c h c o u n ty or parish in the co n tin e n ta l U n ited S tates is ass ig n ed to only o n e D M A . H o u s e h o ld s using T V ( H U T ) o r p e rs o n s u sin g T V (P U T ) is the total p e rc e n ta g e o f h o m e s (or pe rs o n s) in a D M A w a tc h in g T V d u rin g any d ay part, such as m o r n in g , p rim e tim e , and late n ig h t o r after 11:30 p.m . E a ste rn tim e (S issors & B arro n , 2 002). B ro a d c a s t m a n a g e r s are c o n c e rn e d w ith sw e e p s results b e c a u se the p ric e o f a d ­ v ertisin g ti m e is b ased on ra tin g s an d shares. A T V r a t i n g is th e n u m b e r o f h o u s e ­ h o ld s (or p e rs o n s) w h o w a tc h a T V s h o w d iv id e d by all T V H H o r T V h o u s e h o l d s (or p e rs o n s) in th at m a r k e t area h a v in g a T V set. R a tin g s m e a s u re o v e ra ll reach . A s h a r e is the e s tim a te d p e rc e n ta g e o f H U T s or P U T s d u rin g a specified tim e period

th a t is w a tc h in g a p ro g r a m . A s h a r e is the n u m b e r o f h o u s e h o l d s (o r p e rs o n s) w a tc h in g a p a rtic u la r p r o g r a m d iv id e d by the total n u m b e r o f h o u s e h o l d s (o r p e r ­ so n s) w ith T V sets ac tu a lly tu rn ed on d u rin g the tim e the p ro g r a m is aired. S h a re s are a lw a y s larg er than ra tin g s b c c a u s c there is n e v e r a tim e w h e n e v e ry single h o u s e h o l d has a T V on. S h a re s m e a s u r e c o m p a r a ti v e p e r f o r m a n c e from p ro g r a m to p ro g r a m , station to station , an d n e tw o r k to n e tw o rk . S h a re s are h e lp f u l fo r e v a lu a tin g h o w o n e p r o g r a m fares a g a in s t its c o m p e t i ­ tion an d w h e th e r it h a s g a in e d or lo st a u d ie n c e m e m b e r s o v e r d if fe re n t tim e s o f th e y ear. A p r o g r a m ’s ra tin g d e p e n d s on its p o p u la r it y an d the d a y p a r t w h e n it airs. T h e ra tin g o f a sh o w th a t airs d u rin g the day is n o r m a ll y m u c h s m a ll e r than a p r i m e t im e s h o w a irin g b e tw e e n 8:0 0 an d 11:00 p.m . E a ste rn tim e. Y e t th at d a y ti m e s h o w m a y h a v e a h i g h e r sh are o f v ie w e rs u sin g T V in its tim e p e rio d or d ay p a rt. H U T s an d P U T s are l o w e r in the s u m m e r w h e n f e w e r p e o p le w a tch TV a n d h i g h e r in th e w in te r w h e n m o r e tim e is s p e n t in d o o r s w a tc h in g . If

232

CHAP T E R 9

TABLE 9 . 2

Using Ratings and Shares Sweeps Period F eb r u a ry 2002

M a y 2002

July 2002

N o v e m b e r 2002

A B C A ction 2 N ew s R a ti n g

15

15

16

20

Share

25

28.8

33.3

3 5.7

N B C Ch. 7 H om etow n N ew s R a ti n g

25

23

21

21

Share

41.6

4 4 .2

4 3 .8

3 7.5

C B S C h . 12 N e w s Y ou C a n Use R ating

8

7

7

7

Share

13.3

13.5

14.6

12.5

60

52

48

56

P o r t C ity H U T L e v e l s 6 - 6 : 3 0 p .m .

y ou lo o k e d o n ly at ra tin g s, y o u w o u ld m iss the d if fe re n c e s in v ie w in g levels at v a rio u s ti m e s o f y e a r (S is s o r s & B a ro n , 2 0 0 2 ; see a ls o N i e l s e n ’s h o m e p a g e fo r the d e fin itio n s o f te r m s like ratin g at w w w .n i e ls e n m e d ia .c o m /t e r m s .h tn r , n atio n a l r a tin g s an d s h a r e s are f o u n d o n lin e at h tt p : / /t v . y a h o o . c o m / n ie l s e n ). M e d i a m a n a g e r s m u s t id e n tify the p o p u la t io n b a se on w h ic h a ra tin g is b ase d . C a b le c h a n n e l s m a y re p o r t ra tin g s as a p e rc e n t a g e o f th e ir o w n c o v e r a g e rath er than the total U n ite d S tates to m a k e a s t ro n g e r sales p itc h to a d v e rtise rs. A s s u m e a c a b le c h a n n e l r e a c h e s

15 m illio n h o m e s a n d h as a p ro g r a m w a tc h e d in

1 ,5 0 0 ,0 0 0 h o m e s . T h e c a b le c h a n n e l m a y r e p o r t a rating o f 10 fo r the p ro g r a m b ased on the c h a n n e l’s c o v e ra g e area (or 1.5 m illion/15 million) rath er than a rating o f 1.4 b a sed on all U.S. T V h o u se h o ld s (or 1.5 m illion /10 5.5 million U S T V H H ) . S o m e In ternet W e b sites do the sam e and ex p ress au dien ce size as a p erce nta ge o f In ternet users rath er than the U.S. po pu latio n (Sissors & B aron, 2002). R a ti n g s a n d sh ares are u se d in a lo cal D M A to a n a ly z e the p e r f o r m a n c e o f local p r o g r a m s . T h e g e n e ra l m a n a g e r at the A B C -a f filia te d statio n in the Port C ity D M A is a n a ly z in g the p e r f o r m a n c e o f h e r 6 p.m . n e w s c a s t . S h e m a y c o n ­ d u c t p ri m a ry re s e a rc h if the a n a ly s is s u g g e s ts h e r i n v e s tm e n t in a n e w a n c h o r an d e q u i p m e n t m a y b e affe c tin g th e ratin g s. F ro m T a b le 9 .2, it a p p e a rs th at h e r n e w s c a s t ’s a u d ie n c e size i n c r e a s e d o v e r the p a st yea r, e s p e c ia lly in Ju ly . H a d sh e c o n s i d e re d o n ly ra tin g s, sh e w o u ld m iss that h e r a u d ie n c e sh are in c r e a s e d in M a y , a lt h o u g h th e ratin g d id n o t in c r e a s e d u e to a s m a ll e r H U T level. (S h a r e s for e a ch s w e e p s p e rio d d o n o t ad d up to th e H U T lev els b e c a u s e s o m e lo cal v ie w e rs w e re w a tc h in g o th e r local station s a n d c ab le c h a n n e l s from 6 : 0 0 - 6 : 3 0 p .m .) A d v e rti s e rs , m e d i a p la n n e r s , and b r o a d c a s t m a n a g e r s use the c o s t p e r p o in t ( C P P ), w h ic h “ m e a s u r e s the c o s t o f o n e h o u s e h o l d o r d e m o g r a p h ic rating p o in t

M A R K E T I N G A N D RESEARCH

233

in a g iv en m a r k e t ” (S isso rs & B a ro n , 2 0 0 2 , p. 54). A C P P is an e s t im a te o f the d o lla rs re q u ire d to d e li v e r o n e ratin g p o in t (o r o n e p e r c e n t a g e o f the a u d ie n c e ) o f a n y D M A . T h e fo r m u la is: C ost o f a com m ercial C P P = *--------------------------------R a tin g S Q A D (w w w . s q a d . c o m ) is a m e d i a co st fo r e c a s tin g c o m p a n y tha t p ro v id e s C P P s an d C P M s f o r T V and ra d io m a r k e t areas n a ti o n w i d e . S o a m e d i a p la n n e r h a v in g a S Q A D r e p o r t an d ra tin g s b o o k s can e s t im a te the c o s t o f ad s an d m e d i a pla n s , as w e ll as e v a lu a te the co st e ff icien cy o f s h o w s in d if fe re n t m a r k e ts . M a n ­ ag e rs u se C P M s to c o m p a r e d if fe re n t v e h i c l e s ’ e ffic ie n c ie s w h ile th ey c a lc u la te a b ro a d c a s t m e d i a plan v ia C P P (S isso rs & B a ro n , 2 0 0 2 ). A lth o u g h m e a s u r e m e n t m e t h o d s are e x p e c t e d to c h a n g e c o n ti n u a ll y as n ew te c h n o l o g ie s are d e v e lo p e d , b ro a d c a s t m e d i a u s a g e is m e a s u r e d u sin g d ia rie s (s u rv e y s ), m e t e rs ( o b s e rv a ti o n ), an d t e l e p h o n e su rv e y s. D ia rie s are b o o k le t s in w h ic h v ie w e r s and listen ers w rite the s ta tio n s th e y w a tc h o r listen to an d w h en . N a tio n a l T V a u d ie n c e s are m e a s u r e d u sin g p e o p le m e t e r s th at a u to m a ti c a ll y r e g ­ is te r the c h a n n e l n u m b e r s tu n e d in, d a y o f w e e k , an d tim e o f d ay . S a m p l e h o u s e ­ h old m e m b e r s p u s h a b u tto n to in d ic a te w h e n th ey v ie w . M e t e r s and d ia rie s m e a s u re lo cal T V v ie w in g in a b o u t 5 0 large m a r k e ts . T h e o t h e r local T V and rad io m a r k e ts are m e a s u r e d u sin g dia rie s. N ie ls e n is e x p e r i m e n t in g w ith m e a s u r ­ ing m o r e local m a r k e ts u sin g p e o p le m e te rs. A rb it ro n is e x p e r i m e n t i n g w ith the p e rs o n a l p e o p le m e t e r ( P P M ) tha t a u to m a ti c a ll y r e c o r d s c o n s u m e r s ’ m e d i a e x p o ­ su re u sin g a p a g e rlik e d e v ic e (C ru p i, 2 0 0 2 ; H all, 2 0 0 1 ; W a n g , 2 0 0 2 ). T h e m o s t im p o r t a n t p e ri o d s fo r m e a s u r in g ra tin g s, c a lle d s w e e p s , o c c u r in F e b ru a r y , M a y , Ju ly , an d N o v e m b e r (S isso rs & B a r o n , 2 0 0 2 ; W i m m e r & D o m in i c k , 2 0 0 3 ). O n e c o m m o n l y u sed te l e p h o n e s u r v e y m e t h o d is d a y - a f te r recall, w h e r e r e ­ sp o n d e n t s arc c a lle d to d e t e r m i n e th e ir liste n in g an d v ie w in g ac tiv itie s o f the p re v i o u s da y. W it h the c o in c i d e n ta l m e t h o d , h o u s e h o l d s are c a lle d at ra n d o m d u rin g the tim e p e rio d o f interest, a n d re s p o n d e n ts arc a s k e d w h a t th ey arc w a tc h in g o r liste n in g to at th at tim e. T h is m e t h o d m i g h t be u se d to o b ta in i m m e ­ diate fe e d b a c k a b o u t the su c c e s s o f p ri m e t im e o r sp ec ial p r o g r a m m i n g . M a n a g e r s m u s t c o n s i d e r m e a s u r e m e n t lim itatio n s w h en e v a lu a tin g a u d ien c e data. S u b je c ts m a y not be carefu l or h o n e s t w h e n re p o rtin g v ie w in g and listening habits. A m e t e r reco rd s o n ly w h ic h c h a n n e l is tu n e d in an d w h en the re s p o n d e n t p u s h e d the b u tto n — it d o e s n ot n ecess arily reco rd w h e th e r a n y o n e stay ed in the ro o m to w atch . T h e p r o b l e m s w ith P P M s includ e lim ited sa m p le sizes du e to high cost, difficulties in recruitin g p a rticip an ts b e c a u s e installing a p e o p le m e te r is i n v a ­ sive, and su bjects tiring o f pu sh in g bu tton s. T h e d iary m e th o d d o e s not w o rk well b e c a u s e su b je cts w a tc h m o r e c h a n n e ls at sho rte r in tervals, re sultin g in s m a lle r ra t­ in gs an d v ie w e r c o n fu s io n (E p h ro n & G ra y , 2 0 01 ). D iary rep orts tend to u n d e r e s ­ tim ate c a b le a u d ie n c e s (H all, 2 00 1). C o n c e r n s w ere raised a b o u t the e s tim ate d

234

CHAP T E R 9

a u d ie n c e sizes g e n e ra te d from N ie ls e n ’s d iaries an d static p e o p le m e te r (W a n g , 2 0 0 2 ) and A r b it r o n ’s trial o f its p o rta b le p e o p le m e te r ( P P M ; C ru p i, 200 2). M a g a z i n e and n e w s p a p e r a u d ie n c e s are o fte n m e a s u r e d u sin g three t e c h ­ n iq u e s : re c e n t - r e a d i n g and f r e q u e n c y - o f - r e a d in g o f m a g a z in e s an d y e s t e rd a y r e a d in g fo r n e w s p a p e r s . W it h re c e n t - r e a d i n g , a s u b j e c t is s h o w n m o r e th a n 2 00 c a rd s w ith the lo g o s o f m a g a z in e s , e a c h c a rd o n e at a tim e , an d a s k e d w h e th e r the m a g a z in e w a s read o r l o o k e d at in the p a st m o n t h o r o th e r p u b lic a tio n p eriod . F r c q u c n c y - o f - r c a d i n g is m e a s u r e d by s h o w in g a list o f a b o u t 5 0 m a g a z i n e lo g o s o r c o v e r p ic tu re s an d a sk in g the n u m b e r o f c o p ie s o f e a c h m a g a z in e th a t a s u b ­ j e c t read o u t o f the last f o u r issues. Y e s te r d a y - r e a d i n g is m e a s u r e d b y a s k in g a s e le c te d s a m p le w h ic h n e w s p a p e r s th e y re a d y e s t e rd a y (S isso rs & B a ro n , 2 0 0 2 ). N i e ls e n /N e t R a ti n g s ( w w w . n i e l s e n n e t r a t i n g s . c o m ) m e a s u r e s visits to W e b sites. N ie ls e n p la c e s s o f tw a re on the c o m p u t e r s o f a n a tio n a lly r e p r e s e n ta t iv e s a m p le o f a b o u t 6 0 ,0 0 0 s u b j e c ts to re c o r d all sites th ey visit. D a ta g a th e r e d in ­ c lu d e th e n u m b e r o f u n iq u e visitors to a site, h o w d e e p ly they g o into the site, h o w lo ng they stay on e a c h p a g e , an d h o w o ften th ey re tu rn . A B C In te ra c tiv e ( A B C i ; w w w .a b c i n te r a c t iv e a i ic l it s .c o m ) c o n d u c ts a u d its fo r W e b sites, search e n g in e s , an d In te rn e t b r o a d c a s te r s a n d p o sts a u d it re p o rts o n lin e in its re p o r t library. T h e In te ra c tiv e A d v e r ti s in g B u re a u ( w w w . i a b . n e t ) e v a lu a te s and r e c o m ­ m e n d s g u id e lin e s , s ta n d a rd s , an d p ra c tic e s f o r in te ra c tiv e m e d ia . M a n y c o m p a n i e s (listed in T a b le 9 .3 ) p ro v i d e in f o r m a t io n a b o u t c o n s u m e r s and th e ir p r o d u c t and m e d i a u s a g e h ab its to a d v e rtis e rs and a d v e rtis in g ag e n c ie s. P rin t and e le c tro n ic m a n a g e r s also use s o m e o f th e se s a m e so u rc e s. V a rio u s s o u r c e s are a v a ila b le to n e w s p a p e r m a n a g e r s s e e k in g s e c o n d a r y in f o r m a t io n (see T a b le 9.4). A n u m b e r o f c o m p a n i e s p ro v i d e in f o rm a t io n a b o u t or r e s e a rc h s e r ­ v ic e s fo r rad io , T V , a n d /o r c a b le b ro a d c a s te r s (see T a b le 9.5) as w ell as In te rn et an d o u t- o f - h o m e m e d i a o rg a n i z a ti o n s (see T a b le 9.6).

Audience Research: Prim ary D ata Collection A m e d i a m a n a g e r m a y c o n d u c t a p r i m a r y a u d ie n c e r e s e a rc h stu d y to a n s w e r q u e s t io n s u n a n s w e r e d by s y n d i c a te d d ata. T h e m a j o r ty p e s o f r e s e a rc h u se d by n e w s p a p e r m a n a g e r s in c lu d e c ir c u la tio n , r e a d e r s h ip , an d a d v e rtis in g studies.

Circulation Studies.

G e o g r a p h y is i m p o r t a n t to lo c al n e w s p a p e r m a n a g e r s

b c c a u s c it d efin e s the area w h e re r e a d e r s arc a ttracted . C irc u l a ti o n s tu d ie s re v ea l the n e w s p a p e r ’s m a r k e t sh are, m a r k e t sh a r e o f c o m p e t i n g m e d ia , e x is tin g c i r c u ­ lation p a tte rn s , an d a re a s o f p o te n tia l cir c u la tio n g ro w th . A n e w s p a p e r m a n a g e r th en c o n d u c ts a situ atio n or m a r k e t a n a ly s is to d e te r m i n e w h ic h areas to targ et fo r in c r e a s i n g c irc u la tio n .

R ea d e rsh ip Studies.

R e a d e r s h i p s tu d ie s d e s c r ib e th e p e o p le w h o live in the

targ et areas. T h e y o fte n in c lu d e q u e s t io n s a b o u t d e m o g r a p h i c s , p s y c h o g r a p h ic s ,

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TABLE 9.3 Sources o f A dve rtisin g Research Source M e d i a m a r k R e s e a r c h Inc. ( M R I ; w w w .m r i.c o m )

Service P ro v id e s d e m o g r a p h i c an d m e d i a u s a g e in f o r m a t io n for light, m e d i u m , an d h e a v y u se rs o f m a n y p r o d u c t c a te g o rie s .

S i m m o n s M a r k e t R e s e a r c h B u re a u ( S M R B ; w w w .s m r b .c o m )

P ro v i d e s d e m o g r a p h i c an d m e d i a u sa g e in f o rm a t io n for light, m e d i u m , an d h e a v y users o f m a n y p r o d u c t c a te g o rie s . A lso p ro v i d e s r e p o r ts o n k id s , te e n s , H is p a n ic s , an d o th e r s e g m e n ts .

S R D S o r S ta n d a r d R a te and D a ta S e rv ic e ( w w w .srd s.co m )

P ro v i d e s m e d i a ra te s and d a ta in a v ariety o f b o o k s o n the m a j o r m e d i a a n d the L ife s ty le M a r k e t A n a ly s t a n d H is p a n ic M e d i a & M a r k e t S o u rc e .

C M R ( C o m p e t it iv e M e d i a R e p o r ti n g )

(www. cm r.com)

P ro v i d e s a d v e rtis in g e x p e n d it u r e in f o rm a tio n fo r ten m a j o r m e d ia . D o w n l o a d a b l e R & D B rie fin g s are a v a ila b le at the O n lin e D a ta link.

SCANTRACK ( w w w .acn ielsen .com)

P ro v i d e s s c a n n e r - b a s e d sales and m a r k e tin g in f o r m a t io n to m o n i t o r sales, e v a lu a te p rice, and p r o m o ti o n e f f e c ti v e n e s s . A C N ie ls e n h a s a re p r e s e n ta t iv e a n d d e m o g r a p h i c a l l y b a la n c e d W o r l d w i d e C o n s u m e r P anel tr a c k in g c o n s u m e r p u r c h a s e b e h a v i o r an d s h o p p i n g p a tte rn s a c ro s s all retail ty pes.

I n f o r m a t io n R e s o u r c e s ( w w w . info res. com )

P ro v i d e s sa les a n d m a r k e ti n g r e s e a r c h su c h as sto re tr a c k in g and e le c tro n ic p o in t-o f- s a le c o n s u m e r p u rc h a s e s a r o u n d the w o rld . O ffe rs U .S . a n d E u r o p e a n p a n e l data.

S c a r b o r o u g h R e s e a rc h ( w w w .sea rb o ro ugh.com)

P ro v i d e s local m a r k e t c o n s u m e r s h o p p i n g p a tte rn s an d d e m o g r a p h i c , life sty le , and m e d i a u s a g e in f o rm a t io n . P ro v i d e s a s y n d i c a te d stu d y to p rin t m e d i a , ele c tro n ic m e d i a , n e w m e d ia , o u t d o o r m e d i a , spo rts te a m s and le a g u e s , a g e n c i e s , a d v e rtise rs, an d y e llo w p a g e s o n local, r e g io n a l, and n a tio n a l levels.

H a rris In te ra c tiv e ( w w vi'. ha rrisblackin tl. com )

P ro v i d e s p re d i c ti v e , c u s t o m , a n d s trateg ic m a r k e t r e s e a rc h , c o n s u l ti n g , an d T h e H arris Poll. C o n d u c t s In te rn e t m a r k e t re s e a rc h .

G a llu p an d R o b in s o n ( w w w . gallup-robinson.com )

P ro v i d e s a d c o p y testin g , tr a c k in g stud ies, c o n c e p t testin g , c la i m s s u b s ta n tia tio n , sp o k e s p e r s o n tes tin g , e v e n t s p o n s o rs h i p , in te rn a tio n a l te s tin g , c u s t o m , an d m e d ia re s e a rc h and serv ices.

236

CHAPTER 9

TABLE 9.3 C ontinued Source N F O W orld G ro up

(www.nfow.com)

Service P ro v id e s research and c o n s u m e r p an el data for p ro d u c t d e v e lo p m e n t, b ran d m a n a g e m e n t, m a r k e t ev a lu a tio n , p ricing, c u s to m e r satisfactio n , distrib u tio n , a n d ad v ertisin g e ffe c tiv e n e ss. O ffers In tern et-b ased research a n d m ain tain s an i n t e r a c t i v e c o n s u m e r p a n e l co m m u n ity .

N P D G roup

P r o v i d e s m a r k e t d a t a s u c h as s a l e s v o l u m e

(w w w . n p d .c o m )

and tren d s, m a r k e t sh are, p ricin g , p o in t-o f

( w w w . n p d o r .c o m )

sa le t r a c k i n g , a n d c o n s u m e r b e h a v i o r . N P D ’s O n l i n e P a n e l a l l o w s s u r v e y i n g o f d e m o g ra p h ic and g e o g ra p h ic seg m en ts.

R operAS W

( w w w . r o p e r .c o m )

P r o v i d e s r e s e a r c h o n c o n s u m e r l i f e s t y le s , v a l u e s , a t t i t u d e s , a n d m a r k e t b e h a v i o r as w e ll as S t a r c h A d R e a d e r s h i p s c o r e s .

O p in io n R esearch C o rp o ratio n ( w w w .o p in io n r e s e a r c h .c o m ) J.D . P o w e r a n d A s s o c i a t e s

( w w w .jdp o w er.co m ) H o o v e r ’s In c. (»vw'H'. hoo vers, c o m ) M a rk e t F acts ( vvww.rtt a rketfacts. com )

P ro v id e s pu b lic o p in io n , m a rk e tin g , and social research. P ro v id e s c u s to m e r satisfaction studies, m a rk e t re s e a rc h , an aly sis, and fo recastin g . P ro v id e s in fo rm a tio n on c o m p a n ie s, i n d u s t r i e s , a n d m a r k e t in t e l l i g e n c e . P ro v id es m a rk e tin g research c o n su ltin g and i n f o r m a t i o n to c o n s u m e r p a c k a g e d g o o d s c o m p a n ie s and o th e r secto rs in clu d in g te le c o m m u n ic a tio n s , te c h n o lo g y , and b u sin e ss-to -b u s in e ss m ark ets.

S ales and M a rk e tin g M a n a g e m e n t ( iv w w. sa le s a n d m a rketin g .co m )

P ro v id e s data fo r e ffe c tiv e b u y in g in co m e, p o p u l a t i o n , b u y i n g p o w e r , a n d retail s a le s in its S u r v e y o f B u y in g P o w er.

A d v ertisin g R e se a rc h F o u n d atio n ( A R F ; w w w .a r fs it e .o r g )

T h e p r o f e s s i o n a l o r g a n i z a t i o n f o r th e ad v ertisin g , m ark etin g , and m ed ia research field. P u b l i s h e s t h e J o u r n a l o f A d v e r tis in g

R e s e a rc h . A d v ertisin g W o rld

( w w w .a d v e r tis i n g .u te x a s .e d u / w o r ld )

T h e U n i v e r s i t y o f T e x a s at A u s t i n A d v e r t i s i n g D e p a r t m e n t ’s c o m p r e h e n s i v e site o f a d v e r t i s i n g i n d u s t r y lin k s .

A d v ertisin g M e d ia Internet C e n te r ( w w w . a m ic. com )

P r o v i d e s m e d i a a n d r a t e i n f o r m a t i o n as w e ll as s e c o n d a r y r e s e a r c h o n p r i n t, b r o a d c a s t , a n d th e I n t e r n e t .

A dTrack

W e e k l y USA T o d a y a n d H a r r i s I n t e r a c t i v e

( w w w. u sa t o day. c o m /m o n e y /

p o ll t h a t tr a c k s th e e f f e c t i v e n e s s o f

index/adOO 1. him )

ad v ertisin g c a m p a ig n s.

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TABLE 9.4 Sources o f Print Research Source N e w s p a p e r A s s o c i a tio n o f A m e r i c a

S e r v ic e P ro v i d e s d a ta a b o u t the n e w s p a p e r in d u s try ,

( N A A ; w w w .n a a .o rg )

n e w s p a p e r a d v e rtisin g . P u b li s h e s F acts A b o u t

(w w w .n ew sp a p erlin ks.co m )

N e w s p a p e r s re p o r t a n d has d a ta o n lin e .

M a g a z i n e P u b li s h e r s o f A m e r i c a

P ro v i d e s d a ta a n d in f o rm a t io n o n lin e a b o u t

( M P A ; w w w .m a g a z in e.o rg )

the m a g a z in e in d u s try a n d m a g a z in e re a d e r s h ip in c lu d in g the M a gazine H andbook.

M P A P u b li s h e r s I n f o rm a t io n B u re a u ( w w w .m a g a z in e.o rg /p ib )

P ro v i d e s in f o r m a t io n an d d a ta o n lin e in c l u d in g a d v e rtis in g re v e n u e s , p a g e s , and h is to ric a l tre n d s. T r a c k s the a m o u n t a n d ty p e o f c o n s u m e r m a g a z in e a d v e rtis in g .

S ta n d a r d R a te and D a ta S e rv ic e ( S R D S ; w w w .srd s.c o m )

P u b li s h e s th e Business Publication

Advertising Source, C onsu m er M aga zine Advertising Source, N e w sp a p e r Advertising Source, C o m m un ity Publications Advertising Source, Circulation 2 0 0 2 , an d Print M edia P roduction Source p r o v i d in g rate s an d data on v a rio u s p u b li c a ti o n ty pes.

A u d it B u r e a u o f C irc u l a ti o n ( A B C ; w w w .a cc essa b c .c o m )

A u d its a n d v erifie s the c ir c u la tio n o f n e w s p a p e r s , m a g a z in e s , b u s i n e s s an d farm p u b li c a ti o n s , the In te rn et, a n d trad e sh o w s.

B P A In te rn a tio n a l

(w w w .bpai.com )

A u d its a n d verifie s c ir c u la tio n o f trade p rin t p u b li c a ti o n s , n e w s p a p e r s , trad e sh o w s, in d u s try d a t a b a s e s , W e b site traffic, a n d w ire le s s c o m m u n i c a t i o n s .

V erified A u d it C irc u l a ti o n (V A C ; w w w .verifieda udit.com )

P ro v i d e s c ir c u la tio n d a ta f o r free and p aid c o m m u n i t y n e w s p a p e r s in c l u d in g T M C s , s h o p p i n g g u id e s , a lt e rn a t iv e n e w s w e e k l ie s , sp e c ia l interest, e th n ic , a n d n ich e p u b li c a ti o n s as w e ll as trad e a n d c o n s u m e r m a g a z in e s a n d y e llo w p a g e s d ir e c to r ie s.

C om petitive M edia R e p o rti n g ( C M R ; w w w .c m r.c o m )

P ro v i d e s a d v e rtis in g e x p e n d it u r e in f o rm a t io n f o r 10 m a j o r m e d i a in c l u d in g m a j o r p rin t m e d ia .

M en d elso h n M edia Research

P r o v i d e s c u s t o m an d s y n d i c a te d a d v e rtis in g

( w w w . m m rsu rveys. c o m /

a n d m e d i a re s e a rc h in c l u d in g the A fflu e n t

m h om efrm .htm )

S u r v e y and A fflu e n t T ra v e l S u r v e y as w ell as s u b s c r ib e r s tu d ie s, ed ito ria l s u r v e y s , a n d p rin t m e d i a e v a lu a tio n s .

R operA SW ( w w w. roper, com /p ro du cts/

starch.html) P u ls e R e s e a rc h ( w w w .p ul se research .com)

P ro v i d e s S ta r c h A d R e a d e r s h i p sc o re s by m e a s u r in g 2 5 ,0 0 0 ad s in o v e r 4 0 0 m a g a z in e issue s. P ro v i d e s re s e a rc h an d m a r k e ti n g s e r v ic e s for d aily a n d w e e k ly n e w s p a p e r s , s h o p p e r s , and

2 38

C H A P TE R 9

TABLE 9.4 Continued Source

S e r v ic e o th e r s p e c ia l in te re st p u b li c a ti o n s . O ffe rs m a r k e t re s e a rc h fo r p la n n in g and d e v e lo p i n g a W e b site ta r g e tin g local m a r k e t areas.

E d it o r an d P u b li s h e r

P u b li s h e s the M a r k e t G u id e o f d e s c r ip tiv e

( w w w.edi to rand publisher.co m )

i n f o rm a t io n on d aily n e w s p a p e r m a r k e ts i n c l u d in g d e m o g r a p h i c , retail sales, i n c o m e lev els, s h o p p i n g , in d u s trie s , a n d o th e r da ta. P u b li s h e s the I n te rn a tio n a l Y e a r b o o k w ith listin g s o f all dailies W o rl d w i d e and U.S. and C an a d ia n c o m m u n it y s p e cial interest, an d w e e k l y p a p e rs . P ro v i d e s in f o r m a t io n an d articles a b o u t

F o lio ( w w w .foliom ag.com )

the m a g a z in e in d u s try for m a g a z in e m anagem ent.

MRI +

P ro v i d e s a s e a r c h a b le d a ta b a s e o f m a g a z in e

(w w iv.m riplus. com )

rate, a u d ie n c e , a n d ed ito ria l data.

TABLE 9.5 Sources o f Broadcast Research

Source T e le v i s io n B u r e a u o f A d v e r ti s in g ( T V B ; w w w .tvb.org)

Service P u b li s h e s T V facts o n lin e w ith in f o rm a t io n a b o u t ad r e v e n u e , T V tre n d s, T V b a sic s, statio n tim e s sales, T V H H by m a r k e t, and p o litic a l a d v e rtis in g .

C a b le t e le v i s io n A d v e r ti s in g B u r e a u ( C A B ; w w w .ca b le tva d b u rea u .co m )

P u b li s h e s e x c e r p t s fro m C a b le T V F acts o n lin e in c l u d in g i n f o r m a t io n on a d v e rtis in g r e v e n u e s a n d sh ares. P u b li s h e s o n lin e C a b le N e tw o r k Profiles w ith a u d ie n c e d a ta on m a j o r c a b le n e tw o rk s .

T h e C a b le C e n te r ( w w w .cablecenter.o rg/in dex.cfm) M a g n e s s In stitu te ( w w w .cablecenter.org/education/ m ag n es s/in dex.cfm ) R a d io A d v e r ti s in g B u re a u

P ro v i d e s b a c k g r o u n d in f o r m a t io n a b o u t the c a b le in d u s try an d its h isto ry. C o n d u c t s t e l e c o m m u n i c a t i o n s r e s e a rc h and p r o v i d e s e d u c a t io n a l o p p o r t u n it ie s f o r cab le in d u s try p ro f e s s i o n a ls w o r ld w id e . P ro v id e s in f o rm a t io n a b o u t radio

( R A B ; w w w .ra b .c o m )

a d v e rtis in g , p u b li s h e s the M e d i a F a c t B o o k

( vvw vv. rab. com /station/m ed iafact)

o n lin e , an d h as a R e s e a r c h link w ith s o m e rad io in f o r m a t io n a v a ila b le to the pu b lic.

N a tio n a l A s s o c i a tio n o f

I n d u s try a s s o c ia tio n th a t w o r k s on b r o a d c a s t

B ro a d c a s t e r s ( N A B ;

issues. P ro v i d e s s o m e in f o rm a t io n and

w w w .n a b .o rg )

r e s e a rc h o n lin e.

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TABLE 9.5

Continued A rb itro n ( w w w . a rb itro n . com )

P ro v i d e s a u d ie n c e d a ta fo r ra d io , c a b le o u td o o r , a n d the In tern et. S u r v e y s retail, m e d i a , an d p r o d u c t p a tte rn s o f local m a r k e t c o n s u m e r s . D e v e lo p in g the P o rt a b le P e o p le M e t e r for ra d io , T V , an d c a b le ra ting s. In a j o i n t v e n tu r e w ith S c a r b o r o u g h R e s e a r c h , it p ro v i d e s m e d i a a n d m a r k e ti n g r e s e a rc h s e r v ic e s to b ro a d c a s t T V , m a g a z in e , n e w s p a p e r , an d o n lin e in d u stries.

N ie ls e n M e d i a R e s e a r c h ( w w w . n ielsenm edia.com )

P ro v i d e s T V a u d ie n c e m e a s u r e m e n t a n d re la te d s e r v ic e s w o r ld w id e . T h e N a tio n a l P e o p le M e t e r s e r v ic e p ro v i d e s a u d ie n c e e s t im a te s fo r b r o a d c a s t n e tw o rk s , c a b le n e tw o r k s , S p a n is h l a n g u a g e n e tw o rk s , and n a ti o n a l s y n d i c a to rs . P ro v i d e s local ra tin g s e s t im a te s fo r T V statio n s, r e g i o n a l c a b le n e tw o r k s , M S O s , cab le in te rc o n n e c ts , an d S p a n i s h - l a n g u a g e statio n s. P ro v i d e s M o n i to r - P lu s w ith c o m p e t it iv e a d v e rtis in g in te llig e n c e in f o rm a t io n as w ell as In te rn e t u sa g e a n d a d v e r t is i n g in f o rm a t io n .

SQAD ( w w w .sq a d .c o m )

P ro v i d e s C P P S a n d C P M s fo r lo cal m a r k e t ra d io an d T V f o r v a r i o u s d e m o g r a p h i c s e g m e n ts . N a tio n a l d a ta in c l u d e n e tw o r k T V , c a b le , s y n d i c a ti o n , a n d In te rn e t re s e a rc h .

M arketing E valuations/T V Q

(w w w .q sco re s.co m )

P ro v i d e s q u a li ta t iv e ra tin g s o f b r o a d c a s t a n d c a b le p r o g r a m s , p e r f o r m e r s , c h a ra c t e rs a n d li c e n s e d p r o p e r tie s , b r a n d n a m e s , and sp o r ts p e rs o n a litie s . H a s a P e o p le P an el u s e d fo r Q sc o r e s , d ia ry s tu d ie s, p r o d u c t tests, t e l e p h o n e s u r v e y s , a ttitu d e , and u s a g e tr a c k in g and fo r s c r e e n in g c o n c e p ts .

F M R A s s o c i a te s , Inc.

(ww w.fm rassociates.com )

P ro v i d e s ra d io re s e a rc h , p e rc e p t u a l r e s e a rc h s e r v ic e s, E A R S m u s ic a n d p r o g r a m testing , M u s i c T r a c C a l l - O u t R e s e a r c h , m e d i a re s e a rc h , a n d m a r k e t re s e a rc h s e r v ic e s . C o n d u c t s re s e a rc h fo r n o n c o m m e r c i a l b ro a d c a s te r s like the C o r p o r a t io n fo r P u b lic B ro a d c a s t in g and N a tio n a l P u b lic R a d io .

F ra n k N. M a g i d A s s o c i a te s Inc. ( w w w .m agid.co m )

P ro v i d e s b ro a d c a s t c o n s u l ti n g and re s e a rc h s e r v ic e s as w e ll as o n lin e . E - c o m m e r c e , and m e d i a c o n v e r g e n c e r e s e a rc h an d strateg y.

S ta n d a r d R a te a n d D a ta S e rv ic e

(w w w .srd s.c o m )

P u b li s h e s the R adio Advertising Source a n d T V & Cable Source w ith d a ta an d a d v e rtis in g rates.

240

C H A P TE R 9

TABLE 9.5 Continued

Source

Service

C M R ( C o m p e t it iv e M e d i a R e p o r ti n g ) ( w w w .c m r.c o m )

P ro v i d e s a d v e r t is i n g e x p e n d it u r e in f o rm a tio n fo r 10 m a j o r m e d i a in c lu d in g m a j o r b r o a d c a s t m e d ia .

B r o a d c a s t in g an d C a b le Y e a r b o o k ( w w w .b o w k e r.c o m )

P ro v i d e s in f o r m a t io n on ra d io , T V , an d c a b le in c l u d in g listin g s on all ra d io a n d T V sta tio n s, m u ltip le sy s te m c a b le o p e ra to rs , in d e p e n d e n t o w n e r s , su p p lie rs o f in d u s try s e r v ic e s , sta tio n o w n e r s h i p , trad e s h o w s , an d a s s o c ia ti o n s and m a r k e t statistics.

M e d i a R a tin g C o u n c il

D e v e lo p s s t a n d a rd s a n d r e v i e w s ratin g

( w w w.m rc.htsp.co m )

m e t h o d o l o g y to e n s u r e d a ta are c re d ib le .

TABLE 9.6 Internet and O the r Research Sources

Source

Service

Internet and O ut-of-H om e Sources In te ra c tiv e A d v e r ti s in g B u re a u ( w w w .ia b .n e t)

E v a lu a t e s an d r e c o m m e n d s s ta n d a rd s a n d p ra c tic e s , fields re s e a rc h on In te rn e t a d v e r t is i n g e f f e c ti v e n e s s . P ro v i d e s I A B ’s A d v e r ti s in g A B C s and o th e r a d v ic e and d a ta o n li n e on In te rn e t a d v e rtis in g . H as sta n d a rd In te rn e t ad siz es a n d ty p e s o n lin e .

A s s o c i a tio n fo r In te ra c tiv e M e d i a

( w w . /m a rketin g .o rg )

P ro v i d e s i n f o r m a t io n o n the c o m m e r c i a l u s e o f e - m a il m a r k e ti n g , e -ta ilin g , e - c o m m e r c e , o n lin e m a r k e ti n g , a n d in te ra c tiv e T V .

I n f o rm a t io n T e c h n o l o g y A ss o c ia tio n o f A m e r i c a ( w w w .itaa .org )

P ro v i d e s in f o rm a t io n on the in f o rm a t io n te c h n o l o g y in d u s try in c lu d in g c o m p u t e r s , s o f tw a re , t e l e c o m m u n i c a t i o n s , In te rn e t, a n d o n lin e se rv ic e s.

The O pen G roup (w w w . e m a . o r g ) ( w w w .o p e n g r o u p . o rg/fi n d e r - a .h tm ) In te rn e t S o c ie ty (w w w . i s o c . o r g ) ( w w w .is o c .o rg /i n te m e t ) O u t d o o r A d v e r ti s in g . A s s o c i a tio n of A m erica (O A A A ; w w w .o a a a .o rg )

P ro v i d e s in f o r m a t io n an d a d v ic e on a c h ie v in g b o u n d a r y l e s s in f o r m a t io n flow. P ro v i d e s i n f o r m a t io n o n the In te rn e t an d is the h o m e for In te rn e t in f ra s tru c tu re s ta n d a rd s . P ro v i d e s in f o r m a t io n a b o u t the o u t d o o r m e d i u m . L in k s in c lu d e F a c ts & F ig u r e s a n d R e s e a r c h .

M A R K E TIN G A N D RESEARCH

241

TABLE 9.6 Continued D ire c t M a r k e tin g A s s o c i a tio n ( w w w .ih e-d m a .o rg )

P ro v i d e s in f o r m a t io n on d irect, d a ta b a s e , an d in te ra c tiv e m a r k e tin g . T h e D M A L ib ra r y has a R e s e a r c h an d S ta tis tic s link.

E le c tro n ic R e ta ilin g A ss o c ia tio n

(w w w .era .o rg )

P ro v id e s in f o r m a t io n on the e le c tro n ic retailin g in d u s try in c l u d in g in f o m e r c ia ls a n d o n lin e sales. P ro v i d e s an I n d u s try F acts & F ig u r e s link.

P o in t o f P u rc h a s e A d v e r ti s in g In te rn a t io n a l ( w w w . p o p a i . o r g )

P ro v i d e s i n f o r m a t io n on p o i n t - o f - p u r c h a s e ( P - O - P ) a d v e rtisin g .

( w w w.popai.co m/fra m es /

horn epopa ina_fr. h tm I) P r o m o ti o n a l P ro d u c t s A s s o c i a tio n In te rn a t io n a l (w w w .p p a .o rg )

P ro v i d e s in f o r m a t io n o n p ro d u c t s im p r i n te d w ith a f i r m ’s n a m e , log o, o r m e s s a g e in c lu d in g c lo th in g or m e r c h a n d is e . T h e R e s o u r c e s & T e c h n o l o g y link in c l u d e s re s e a rc h .

Y e llo w P a g e s I n t e g ra t e d M e d ia A s s o c i a tio n (vvw w .y p p a .o rg ) A B C In te ra c tiv e ( A B C i ;

P ro v i d e s in f o r m a t io n and d a ta on p rin t a n d e le c tro n ic y e llo w p a g e s in d u s try . A u d its a n d verifies W e b site traffic,

(w w w .a be in te ractivea ltd its. com )

ad d e li v e ry , se a rc h e n g in e s , e -m a il

(w w w .abcinteractivea udits.co m /reportlib/ site_bytes.html)

and e -m a il ad d e liv e ry , an d In te rn e t

(w w w .abcin tera ctiveaudits.com / reportiib/a va il_info.h tm I)

o n li n e — se e a d d re s s e s at left.

S ta n d a r d R a te a n d D a ta S e rv ic e

(w w w .srd s.c o m )

b r o a d c a s te rs . P ro v i d e s au dits

P u b li s h e s the In te ra c tiv e A d v e r ti s in g S o u rc e , O u t - o f - H o m e A d v e r ti s in g S o u rc e , D ire c t M a r k e tin g L ist S o u rc e , an d T e c h n o l o g y M e d i a S o u rc e .

N i e ls e n /N e t R a tin g s

(w w w .nielsenne tratings.c om ) A d Z o n e R e s e a r c h , Inc.

(w w w .a d zo n ein tera c tiv e.co m )

P ro v i d e s m e a s u r e m e n t s o f W e b site visits. P ro v i d e s In te rn e t ad a ctiv ity data fo r sites w o r l d w i d e by a d v e rtis e r, b ra n d , in d u s try , date ra n g e , im p r e s s io n s , g e o g r a p h i c l o c a tio n , a n d e x p e n d it u r e s . M o n i to r s b a n n e r ad s, tex t ads, in te rstitials, k e y w o r d s , links, b u tto n s, p o p - u p s , a n d h o v e r ads.

T raffic A u d it B u r e a u fo r M e d i a

P ro v i d e s c ir c u la tio n data o r m e a n s

M easu rem en t (T A B )

to m e a s u r e o u t- o f - h o m e m e d i a

( w w w .tabonline.co m )

i n c l u d in g p o s te rs , b u lle tin s, and s h e lte r an d tru c k a d v e rtisin g .

242

CHAPTER 9

T ABL E 9 . 6

Continued

Source Internet A dvertising R esource G uide

( ww w .a dm edia.org)

Service A d v e r t i s i n g si t e d e v e l o p e d b y D r . H a i r o n g L i at M i c h i g a n S t a t e U n i v . T h e R e s e a r c h l i n k lists m a n y s i t e s .

N etacceptable

(m a rketing. te nag ra.com/ n et-accep ta ble.h tm 1) D igitrends.net

(w w w.d igitrends.net)

P ro v id e s links on u n a c c e p ta b le and ap p ro p ria te In tern et ad v ertisin g . P rovides inform ation for interactiv e m ark eters.

Selected Government Data and Information Sources U .S. C e n s u s B u reau

P rovides d em o g rap h ic and econom ic

( www.census.gov ) ( h tip ://factfin de r. ceti su s. go v/h om e/

d ata o n U .S . m a rk e t a reas. T h e

en/acsdata.html)

a t le f t) a n d A m e r i c a n F a c t f i n d e r

A m e ric a n C o m m u n ity S u rv e y (address link h a v e u sefu l in fo rm atio n .

N atio nal A rch iv es and R e co rd s A dm inistration

N A R A ' s R e s e a r c h R o o m li n k p r o v i d e s a starting p o in t for se a rc h e s.

( www.nara.gov o r www.archives.gov)

Other Research Links ITS (In fo rm a tio n T e c h n o lo g y S erv ices)

P ro v id e s links to G e n e r a l a n d

at U n i v . o f T e x a s - A u s t i n

S p e c i f i c S t a t i s t i c s a n d a n s w e r s to

Statistical S u p p o rt

q u e s tio n s a b o u t u s in g statistics.

( w w w .utexas.ed u/cc/s tat) O p e n D irecto ry P roject

P ro v id e s an o p e n d ire c to ry o f

D M O Z -D ire c to ry M o z illa

links d e v e lo p e d by vo lu n teers

(dm oz.org/Science/M a th/Statistics/ )

and hosted and sp o nsored by N etscap e C o m m u n ic a tio n Corp.

S tatistics.co m

(www.statistics.com )

C o m m e r c i a l si t e t h a t p r o v i d e s l i n k s to d a t a s o u r c e s .

a n d m e d i a u s a g e to d i s c o v e r w h o r e a d s th e n e w s p a p e r , w h y , th e s e c t i o n s th e y p r e f e r , a n d th e b e n e f i ts th e y o b t a i n f r o m r e a d i n g it. A la r g e m e t r o p o l i t a n n e w s p a ­ p e r m i g h t d e v e l o p a life s t y le s e c t io n a p p e a l i n g to u p p e r i n c o m e city r e s i d e n t s w h o a re m o v i n g to a p a r t i c u l a r zip c o d e . A s m a l l t o w n n e w s p a p e r m i g h t in c r e a s e s o c c e r c o v e r a g e in th e s p o r ts s e c t i o n w h e n r e s e a r c h s h o w s m a n y lo c a l c h i l d r e n a n d p a r e n t s p a r t i c i p a t e in s o c c e r . S t u d i e s i n c o r p o r a t i n g d e m o g r a p h i c s , p s y c h o g r a p h i c s , a n d m e d i a u s a g e are u s e d to m e a s u r e th e a u d i e n c e c h a r a c t e r i s t i c s o f c o m p e t i n g m e d i a . I n f o r m a t i o n a b o u t w h o e x c l u s i v e l y r e a d s e a c h lo c a l d a il y , w e e k l y , a n d s h o p p e r ; w h o r e a d s a co m b in atio n o f these p u b licatio n s and w h y ; and how these and oth er p u b lic a ­ ti o n s a re u s e d m a y r e v e a l u n t a p p e d r e a d e r s h i p s e g m e n t s .

M A R K E T I N G A N D RESEARCH

A d vertisin g S tu d ie s.

The

m e d ia

243

m a n a g e r o r m e d ia re p r e s e n ta t iv e sells

m e d ia s p a c e to m e d ia b u y e rs u sin g a m e d i a kit. A m e d ia kit p o s itio n s the m e d ia p r o d u c t as an id eal v e h ic le fo r the a d v e rtise r. M e d i a o u tle ts m a y c o n d u c t r e ­ s ea rc h to a c c u ra te ly d e s c r ib e the d e m o g r a p h ic an d p s y c h o g r a p h ic c o m p o s it io n o f th eir a u d ie n c e s . I n d u s try g r o u p s p ro v i d e a d v e rtis in g a d v ic e an d data f o r m e d ia kits (see T a b le s 9.3 , 9.4, 9.5, an d 9.6). T h e C h a m b e r o f C o m m e r c e , o th e r local e c o n o m i c d e v e l o p m e n t offices, o r state a g e n c i e s c o n c e r n e d w ith e c o n o m i c d e ­ v e l o p m e n t p ro v id e m a r k e t in f o rm a tio n . S ta te o r re g io n a l pres s a s s o c ia ti o n s m a y c o m p i le p ri m a ry and s e c o n d a r y m a r k e t in f o rm a t io n . In c lu d e C P M d a ta in m e d i a kits o r m a k e th e m a v a ila b le to a d v e rtise rs. M a n y veh icles w ith online sites include a m e d ia kit, rate card, an d in fo rm ation on their au dienc es. M R I + ( w w w . m r i p l u s . c o m ) co n so lid ates searchab le datab ases used to ev aluate m a g a z in e s th at include in form atio n used in m e d ia kits w hen one registers with the free service. M a n y m e d ia outlets list m ed ia kits on their W e b sites, including F o rb es ( w w w . f o r b e s . c o m / f d c / a d v e r t i s e . s h t m l or w w w . f o r b e s m e d i a . c o m ) and F o rtu ne ( w w w . f o r t u n e . c o m / i n d e x w . j h t m l 7 c h a n n e I = / h t m l / m e d i a k i t . h t m l ) . A d v e r ti s e r s p u r c h a s e d a ta on th e ir o w n an d c o m p e t i t o r s ’ p a st an d p re s e n t m e d i a activ ity fro m C o m p e t it iv e M e d i a R e p o r ti n g ( C M R ; w w w . c m r . c o m ). C M R provides

the

M ulti-M edia

S e rv ic e

(w w w . c m r .c o m / p r o d u c t s / m u l ti m e d i a .h t m l)

th a t re p o r ts ad s p e n d i n g in 10 m a j o r m e d ia : c o n s u m e r m a g a z in e s , S u n d a y m a g a ­ zin es , n e w s p a p e r s , o u td o o r , n e tw o r k T V , spo t T V , sy n d ic a te d T V , c a b le T V , n e tw o rk rad io , and n atio n a l sp o t rad io . T h e C o m p a n y / B r a n d $, C la s s /B r a n d $, and A d $ S u m m a r y re p o rts detail s p e n d i n g in th e s e m e d i a by in d u s trie s, p a re n t c o m p a n i e s , and b ra n d s . M e d i a m a n a g e r s u se th es e d ata to iden tify a d e s ire d a d ­ v e r t i s e r ’s b u y in g p a tte rn s and gain in s ig h t into m e d i a buy s. P o s i ti o n in g r e s e a rc h in c lu d e s s tu d ie s o f a u d ie n c e p e r c e p t io n s to d is c o v e r a b r a n d or p r o d u c t ’s u n iq u e a ttrib u te (or c o m b i n a ti o n o f a ttrib u te s) to b e tt e r m e e t c o n s u m e r s ’ n e e d s . P o s i ti o n in g re s e a r c h d ia g n o s e s w h y a u d ie n c e s a re n o t a t­ tra c te d to a p r o d u c t an d in c lu d e s o th e r fa c to rs s u c h as h o w a p r o d u c t c o m p a r e s to c o m p e t it o rs . It often u ses e x p lo r a to r y and d e s c r ip tiv e m e t h o d s su c h as fo c u s g r o u p s o r s u r v e y s . Id e n tify in g c o n s u m e r hab its, lifesty les, b e h a v io r s , an d d e sire s th r o u g h p r i m a r y ta r g e t s e g m e n t re s e a rc h p ro v i d e s the in f o r m a t io n b asis fo r p r o d ­ uct p o s itio n in g . F o r m e d i a o rg a n i z a ti o n s , p o s i ti o n in g c o n c e r n s the a u d i e n c e ’s i m a g e o f the m e d i a o u tle t o r c o m p a n y , o r th e p r o d u c t in this case. A n e w c a b le n e t w o r k ’s n a m e is critic al to its su c c e s s fu l p o s i ti o n in g b e c a u s e it m a y be the o n ly i n f o r m a ­ tion the a u d ie n c e h e a rs a b o u t it. A t the m e d i a c o n te n t level, s tu d ie s o f a u d ie n c e re a c tio n s to an d p r e f e re n c e s fo r b r o a d c a s t an d c a b le p r o g r a m m i n g , n e w s and m a g a z in e articles an d fo rm a t, a n d the s tru c tu r e an d c o n te n t o f W e b sites are c ri ti­ cal to m a i n ta i n in g a u d ie n c e c o m m i t m e n t . A m a n a g e r c o n d u c ts a m a il or te le ­ p h o n e s u r v e y , fo c u s g ro u p , o r p e rs o n a l in t e rv i e w s to d e te r m i n e w h e t h e r the local c o m m u n i t y fa v o r s the n e w s talen t an d n e w s c a s t . R e s u lts m a y be u se d to d e t e r ­ m i n e lo cal n e w s a n c h o r c h a n g e s .

244

CHAP T E R 9

M e d ia Content: Evaluative, Formative, and S um m ative Research E v a lu a t iv e r e s e a rc h d e te r m i n e s h o w w ell the m e d i a c o n te n t c o n v e y s w h a t it is in te n d e d to c o n v e y . C a u s a l re s e a rc h m e t h o d s su ch as e x p e r i m e n t s are o ften used to c o n d u c t this re s e a rc h . A d v e rti s e rs and th e ir a d v e rtis in g a g e n c i e s u se e v a l u a ­ tive r e s e a rc h to test m e s s a g e s b e fo r e (p r e te stin g ) an d afte r (p o s tte s tin g ) ad s are c o n v e y e d to the g e n e ra l p u blic. T e s t m a r k e ti n g e v a lu a te s a u d ie n c e tas tes for b r o a d c a s t an d c a b le p r o g r a m ­ m in g , p rint ed ito rial c o n te n t, W e b site s tru c tu r e a n d c o n te n t, and a d v e rtisin g . An ad m i g h t be aire d in o n e m a r k e t b e fo r e it airs n a tio n a lly to p ro j e c t w h a t its effec t on c o n s u m e r b e h a v i o r m i g h t be. A d s m i g h t be s h o w n in tw o d if fe re n t m a r k e ts or on a tw o - w a y c ab le s y s te m in o n e city, w ith s u b s c rib e r s in o n e p a rt o f the city s e e in g on e v e rs io n o f a p ro g r a m or c o m m e r c i a l an d th o se liv in g in a n o t h e r area s e e in g a n o th e r v e rs io n . R e s u lt s o f a r a n d o m te l e p h o n e s u r v e y r e v e a l w h ic h p r o ­ g ram v e rs io n e a rn e d h i g h e r ra tin g s o r w h ic h c o m m e r c i a l s p u r re d m o r e sales. W ith f o r m a ti v e r e s e a rc h , p ro d u c t io n c o m p a n i e s a n d T V n e tw o r k s p re te s t p r o ­ g r a m m i n g an d a d v e rt is e rs p re te s t ads b e fo r e c o m m i t t i n g full re s o u r c e s to th e m . C o n c e p t testin g a s s e s s e s a p r o g r a m ’s p o te n tia l p o p u la r ity o r the p o te n tia l e f f e c ­ t iv e n e s s o f an a d ’s k e y sellin g c o n c e p t b e fo r e e x p o s u r e to the g e n e ra l p ub lic. A c o n c e p t is tes ted by h a v in g su b je c ts re a d a o n e - p a g e p r o g r a m s u m m a r y o r s h o w ­ ing th e m a m o c k - u p o f a c o m m e r c i a l m a d e u sin g slides an d an a u d io ta p e . S u b je c t s m a y be inv ited to a th e a t e r to v ie w a pilo t p ro g r a m . A f te r v ie w in g , th ey

re p o r t

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d e te r m i n e h o w p o p u l a r v a ri o u s c h a ra c t e rs and e n d in g s m i g h t be ( W i m m e r & D o m i n i c k , 2 0 0 3 ). S u m m a t i v e re s e a r c h e x a m i n e s w h e th e r the a p p ro p r ia t e m e s s a g e is c o n v e y e d to th e ta r g e t m a rk e t. T h is a llo w s the m e d i a o r a d v e rtis in g m a n a g e r to e v a lu a te w h e t h e r the m e d ia o r a d v e rt is i n g c o n te n t o b je c t iv e s w e re a c tu a lly a c c o m p lis h e d . S u m m a t i v e r e s e a rc h can be p e r f o r m e d in th e field d u rin g a c a m p a i g n or p u r ­ c h a s e d as s e c o n d a r y da ta. F o r e x a m p l e , R o p e r A S W ( w w w . r o p e r . c o m ) o ffers S ta r c h A d R e a d e r s h i p ( w w w .r o p e r . c o m / p r o d u c t s / s t a r c h .h t m l ), m e a s u r in g a b o u t 2 5 ,0 0 0 ads in m o r e than 4 0 0 m a g a z in e is su es to d e v e lo p re a d e r s h ip scores. S c o re s in c lu d e the p e r c e n t a g e o f r e a d e r s w h o saw the ad an d re ad the c o p y . A d s are r a n k e d a g a in s t o th e r s in the s a m e is su e a n d p r o d u c t c a te g o ry to ass e ss h ow the ad p e r f o r m s o v e r tim e an d a g a in s t c o m p e t it o rs .

SUMMARY A ll m e d i a m a n a g e r s m u s t u n d e r s ta n d re s e a rc h from a b r o a d p e rs p e c ti v e to u se it eff e c tiv e ly . It is im p o r t a n t to u n d e rs ta n d re s e a rc h m e t h o d s an d c o n c e p t s like v ariab les , reliab ility , an d va lid ity to c o n d u c t o r e ff e c tiv e ly ass ess res e arc h .

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245

B e fo re d e s i g n in g a re s e a rc h stu d y , th r e e is su es are c o n s i d e re d . First, h o w m u c h is a lr e a d y k n o w n a b o u t th e p ro b l e m at h a n d ? S e c o n d , h o w m u c h in f o rm a t io n is n e e d e d a b o u t e a c h a u d ie n c e m e m b e r ? T h ir d , h o w im p o r t a n t is it that the stud y r es u lts are g e n e ra l iz a b l e to o t h e r p e o p le an d situ a tio n s ? T h e a n s w e r s to th ese q u e s t io n s d irect th e r e s e a r c h e r to s o m e ty p e s o f re s e a rc h an d n o t to o th ers. A d v e rti s in g , prin t, b r o a d c a s t, c a b le , an d o n lin e m a n a g e r s u se s i m i la r k in d s o f d ata, re s e a rc h so u rc e s, a n d re s e a rc h te c h n i q u e s in d if fe re n t w a y s. M e d ia o u tle t m a n a g e r s m u s t c o m p r e h e n d h o w a d v e rtis e rs use a u d ie n c e d a ta an d m e d ia p la n n i n g c o n c e p t s s u c h as in d e x e s , re a c h , fr e q u e n c y , C P M s , and C P P s to s e lect m e d i a v e h ic le s f o r a d v e rtis in g b u y s. U n d e r s t a n d in g h o w

a d v e rtise rs

and a g e n c i e s use th es e c o n c e p t s h e lp s a m a n a g e r sell a d v e rt is i n g tim e o r sp ace e ffe c tiv e ly . S o m e o f the re s e a rc h c a te g o rie s that are i m p o r t a n t to e ff e c tiv e m e d i a m a n a g e ­ m e n t are p r i m a r y , s e c o n d a r y , s y n d i c a te d , e x p lo r a to r y , d e s c r ip tiv e , an d c a u s a l r e ­ se arch. A p p lie d re s e a rc h m e t h o d s in c lu d e a u d ie n c e , p o s i ti o n in g , fo r m a tiv e , and s u m m a t i v e res e arc h . D a ta -c o lle c tio n d e s i g n s a v a il a b le to the r e s e a r c h e r in c lu d e f o c u s g ro u p s , in - d e p th in t e rv i e w s , s u r v e y s , and e x p e r i m e n t s . B y c o lle c tin g in f o r­ m a tio n a b o u t the c o n s u m e r , the m e d i a m a n a g e r m a k e s m o r e in f o r m e d strategic d e c is io n s an d th u s m a r k e ts the m e d i a v e h ic le m o r e e ff e c tiv e ly to a d v e rtise rs.

Case 9.1 The Case of the Ratings Increase

S u e A l- M a tr o u k , g e n e ra l m a n a g e r o f W P R T - T V 2 in P o rt C ity , w a s d e lig h te d to r e c e iv e the latest s w e e p s re p o r t s h o w in g the ra tin g s an d s h a r e s fo r A c tio n N e w s at 6 p .m . a p p e a r e d to in c r e a s e o v e r the p a s t f o u r s w e e p s p e ri o d s (see T a b le 9.2). S h e w o n d e r e d w h e t h e r the in c r e a s e w a s d u e to th e i n v e s tm e n t she h a d m a d e in a ne w a n c h o r, n ew set, a n d e q u i p m e n t like the D o p p l e r rad ar, n e w s h c li c o p tc r , and r e m o te tru ck. It w a s e x p e n s i v e to retain the n e w s h e li c o p te r so she w o u ld c u t that e x p e n s e if it w a s n o t a fa c to r in the ra tin g s in c re a se . Y e t h e r n e w s d ire c to r, Jo h n S m a l l, said he h a d r e c e i v e d a g re a t d e a l o f p o s itiv e fe e d b a c k a b o u t it. P e rh a p s sh e c o u ld sh a r e the c o s t o f the h e li c o p te r w ith a n o t h e r m e d i a o u tlet. She also w o n d e r e d w h e th e r the n ew p r o m o ti o n a l c a m p a ig n b y p r o m o ti o n s d ir e c to r J a n ice B ia g g i h a d h a d an effect. S ue n o te d the ratin g s an d s h a r e s o f the lo n g - s ta n d i n g n e w s c a s t le a d e r in the m a r k e t, N B C ’s “ H o m e t o w n N e w s , ” a p p e a r e d to b e d e c lin in g sin c e M a y . S he w a n te d to k n o w w h y this w a s h a p p e n in g . T h e C B S “ N e w s Y o u C a n U s e ” n e w s ­ c a st re m a in e d solid ly in third p o sitio n and c o u ld b e lo s in g v ie w e rs . S h e w o n ­ d e re d w h e t h e r th e se c h a n g e s w e re d u e to i m p r o v e m e n t s in h e r n e w s c a s t , facto rs re la te d to the c o m p e t in g n e w s c a s t s , o th e r fa c to rs in the m a r k e t, o r a c o m b i n a ti o n o f all th e s e facto rs. S h e p l a n n e d to call R o b e r t H o w a r d , h e r s t a ti o n ’s g ro u p

246

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o w n e r, to in fo rm h im o f th e ra tin g s in c r e a se an d a sk him to s u p p o r t a re s e a rc h p ro j e c t to find o u t w h a t c o n tr ib u t e d to the n e w s c a s t ’s su cc ess. A v e r y A tk in , sales m a n a g e r at W P R T , c a m e into h e r office w ith a b ig sm ile on his face. “In all m y y e a rs in this m a r k e t I ’ve n e v e r seen a b o o k like this. I ’ve n e v e r s e e n us so c lo s e to H o m e t o w n N e w s . W e m a y h av e the b e s t sales q u a rte r e v e r a fte r m y team an d I go o u t an d sell a d v e rtis in g b a s e d on this b o o k . ” S u e re p lie d , “ I ’m e x c ite d too. I ’m really p r o u d o f o u r team b e c a u s e all th e h a rd w o rk p aid off. A n d I k n o w y o u an d the sales s t a f f w ill d o a g re a t j o b se llin g us b ased on th is b o o k . B u t I w a n t to be su re w e stay on this u p w a r d track . W e m a y be p o is e d h e re to o v e rt a k e and p a ss H o m e t o w n N e w s an d I d o n ’t w a n t to s q u a n d e r this o p p o r t u n i t y . ” A v e r y rep lie d , “ Y e a h , this is g re at, b u t w e rea lly do n e e d to u n d e rs ta n d w h y this is h a p p e n in g so w e can k e e p it u p . ” J u s t then Jo h n an d J a n i c e c a m e in also lo o k in g q u ite h a p p y . S u e said, “ G o o d n e w s su re tra v e ls fast. G r e a t jo b , g an g ! I k n o w h o w h a rd y o u ’ve w o r k e d and I ’m so p r o u d o f w h a t w e ’ve a c c o m p l i s h e d . ” J a n ic e said, “ T h a n k s ! Y e a h , this is great. I j u s t w a n t to k e e p this train on the track, so to s p e a k .” “T h a n k s and m e , to o ,” said J o h n . “ I’ve b ee n in the n e w s b u s i n e s s too lo n g to sit on m y la u r e ls .” S u e t h o u g h t fo r a m o m e n t an d sa id, “ L e t ’s plan to h a v e a m e e t in g to m o r r o w . I w a n t e a c h o f y o u to tell m e w h y yo u th in k this is h a p p e n i n g an d w h a t w e ne ed to d o to m a in ta in this su c c e s s. I als o w a n t e a c h o f y ou to p r o p o s e id e as an d o b ­ j e c t iv e s f o r a r e s e a rc h stu dy . W e n e e d s o m e g o o d r e s e a rc h to p lan an d m a in ta in this s u c c e s s in the fu ture. I th in k R o b e rt will s u p p o r t a stu d y an d m ig h t e v e n giv e us s o m e ex tr a m o n e y if w e g iv e him a g o o d re s e a rc h p r o p o s a l . ”

A S S IG N M E N T 1. E v a lu a t e the ra tin g s , sh a re s, an d H U T S in T a b le 9.2 ca re f u lly . W r i te a p a r a g r a p h or tw o e x p la i n in g w h a t th e se ra tin g s an d s h a r e s a p p e a r to s u g ­ g e st a b o u t e ach s t a ti o n ’s p e r f o r m a n c e an d w h y . E x p la i n w h e th e r it a p p e a rs v ie w e r s h ip fo r e a c h station is in c r e a sin g , d e c li n in g , o r s ta y in g the s a m e and why. 2. H o w m u c h c o n fi d e n c e d o y o u h a v e in y o u r a n s w e r s to Q u e s ti o n 1? W h a t do the ra tin g s a n d sh a r e d a ta really r e v e a l? D o the d a ta in T a b le 9.2 tell us w h y the ra tin g s and sh ares o f the station h a v e c h a n g e d ? W h y o r w h y n o t? 3. W rite a few d eta ile d p a r a g r a p h s tha t a n s w e r the fo l lo w in g q u e s t io n s . H o w can S u e d e te r m i n e w h e t h e r the ra tin g s a n d s h a r e s for h e r 6 p .m . n e w s c a s t are im p r o v i n g d u e to the in v e s tm e n ts s h e ’s m a d e in tale n t an d e q u i p m e n t ? C a n she a n s w e r this q u e s t io n ? W h y o r w h y no t? W h a t ca n S u e re alistic ally d o to g et id eas a b o u t w h y v ie w e rs h ip o f h e r n e w s c a s t m a y b e in c r e a s in g ? 4. W h a t ty p e o f re s e a rc h stu d y s h o u l d e a c h o f the f o l lo w in g m a n a g e r s p r o ­ p o se to S u e ? W h a t ty p e o f re s e a rc h stu d y is n e e d e d to d e t e r m i n e e x te r n a l

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fa c to rs tha t m a y be h a v in g an e ff e c t? N a m e and d e s c r ib e the re s e a rc h o b ­ je c t iv e s , ty p e o f stu d y , o r re s e a rc h , m e t h o d s , and d a ta a n a ly s is t e c h n i q u e s to use, an d so o n , to a n s w e r Q u e s ti o n s 4a th r o u g h 4d. a. W h a t ty p e o f r e s e a rc h stu d y s h o u l d the n e w s d ir e c to r p r o p o s e ? W h y ? b. W h a t ty p e o f r e s e a rc h stu d y s h o u ld the sales m a n a g e r p r o p o s e ? W h y ? c. W h a t ty p e o f re s e a rc h stu d y s h o u ld the p r o m o ti o n s m a n a g e r p r o p o s e ? W hy? d. W h a t typ e o f re s e a rc h stu d y s h o u ld be d e v e lo p e d to d is c o v e r w h a t o th e r fa c to rs (e.g., c h a n g e s in th e o th e r s t a t i o n s ’ n e w s c a s t s , etc.) m a y h a v e an in flu e n c e ? 5. U s in g y o u r a n s w e r s to Q u e s ti o n 4, d e s ig n a re s e a rc h p la n fo r S ue to p r e ­ s e n t to the s t a t i o n ’s o w n e r. F o r w h a t ty p e o f re s e a rc h stu d y o r s tu d ie s s h o u l d S ue c o n tr a c t? W h a t ty p e o f stu d y o r s tu d ie s c o u ld S u e c o n tr a c t for th a t w o u ld serv e the n e e d s an d m e e t the re s e a rc h o b je c t iv e s o f n e w s , p r o ­ m o t io n s , an d sale s an d e x a m i n e e x te r n a l fa c to rs? S h o u ld sh e c o n tr a c t for m o r e than o n e s t u d y ? If yes, w h ic h o n e s s h o u l d sh e c o n tr a c t for an d in w h a t o rd e r?

Case 9.2 Evaluating Contrib utors to Public TV

A s s u m e y o u are the g e n e ra l m a n a g e r o f th e p u b lic T V station in y o u r city o r the n e a re s t m a j o r city. Y o u j u s t c o m p l e te d y o u r la test fu n d r a is i n g c a m p a i g n an d are un satisfie d w ith the resu lts. Y o u w a n t to d is c o v e r w h y y o u r fu n d r a is i n g c a m ­ p a ig n w a s n o t as s u c c e s s fu l as yo u h a d a n tic ip a te d . Review' the M e d i a m a r k data for all c o n tr ib u t o rs to p u b lic T V n a t i o n w i d e (see T a b le 9.7). E v a lu a t e S i m m o n s o r m o r e r e c e n t M e d i a m a r k d ata if a v a ilab le. If the S R D S L ife s ty le M a r k e t A n a ­ lyst ( L M A ) is av a ila b le in y o u r library, r e v ie w data on the r e le v a n t d e m o g r a p h ic s e g m e n t profiles (e.g., 45 to 64 y e a rs o ld , in c o m e $ 7 5 ,0 0 0 an d o v e r, an d any o t h e r re le v a n t c a te g o rie s y o u find). E v a lu a t e an y o th e r av a ila b le data a b o u t the ta rg et s e g m e n t o f c o n tr ib u t o r s to p u b lic T V . R e v ie w the c e n s u s d a ta fo r d e m o g r a p h i c a n d e c o n o m i c in f o rm a t io n a b o u t y o u r city o r th e n e a re s t m a j o r city. T ry to find o u t w h o m a j o r in d iv id u a l and b u s i n e s s c o n tr ib u t o r s m i g h t be. If th e L M A re p o r t is a v a ila b le in y o u r lib rary , r e ­ v iew d a ta fo r y o u r city o r the n e a re s t m a j o r city in th e M a r k e t Profiles section . L o o k for o t h e r s o u r c e s o f s e c o n d a r y o r s y n d i c a te d m e d i a re s e a rc h th a t p ro v i d e in f o rm a t io n a b o u t y o u r city o r m ark et. R e v ie w T a b le s 9.3, 9.4, 9.5, an d 9 .6 to see if any o f th ese so u rc e s are a v a ila b le in y o u r library. C h e c k fo r o th e r so u rc e s o f s e c o n d a r y o r s y n d ic a te d m e d i a r e ­ s e arc h re p o r ts on the p u b lic T V c o n tr ib u t o rs ta r g e t s e g m e n t, y o u r city o r m a r k e t, an d e v a lu a te any a p p ro p r ia t e da ta a v a ilab le . In o th e r w o rd s , c o n d u c t a th o r o u g h

2 48

C H A P TE R 9

TABLE 9 . 7 M R I Data on All C o n trib u to rs to Public TV C o n t r i b u t e d to P u b l i c B r o a d c a s t T e l e v i s i o n in P a s t 12 M o n t h s R ep o rt B ase: A d u lts

* Popu-

* A

lationC ontr.

B P ercent-

B ase:

to P u b l i c

A d u lts

TV

( 000 )

( 000)

T otal

199438

17219

M en

95691

7877

M e d ia m a r k R ec re a tio n V o lu m e Spring 2000

age Down

C

D

P ercen t-

Index

age A cross

C o p y rig h t 2000, M e d ia m a rk R e s e a r c h In c . ( A d d 0 0 0 to e n d o f n u m b e r s in P o p . & A C o l u m n s ) * S a m p l e s i z e f o r t h is ite m is l e s s t h a n 5 0

100 4 5.7

8.6

100

8.2

95

103747

9342

54.3

9

104

G r a d u a t e d C o ll e g e

44940

7034

4 0.9

15.7

181

W om en A tte n d e d C o ll e g e

52878

4233

24.6

8

93

G r a d u a t e d H ig h S c h o o l

66360

4204

24.4

6.3

73

D id n o t G r a d u a t e H ig h S c h o o l

35260

1748

10.2

5

57

18-24

2 5691

668

3.9

2.6

30 59

25-34

39066

1979

11.5

5.1

35-44

44791

3433

19.9

7.7

89

45-54

34774

3945

22.9

11.3

131

55-64

2 27 11

2729

15.8

12

139

65 o r o v e r

32404

4464

25.9

13.8

160

1 13259

9351

54.3

8.3

96

E m p l o y e d Full T im e P r o f e s s io n a l

20825

2707

15.7

13

151

E x e c u ti v e /A d m i n . /M a n a g e r ia l

19692

2741

15.9

13.9

161

C l e r i c a l/ S a le s /T e c h n ic a l

3 7 6 25

2606

15.1

6.9

80

P r e c i s i o n / C r a f t s /R e p a i r

14305

67 9

3.9

4.7

55

H /D I n c o m e $ 7 5 ,0 0 0 o r m o r e

48259

68 3 8

39.7

14.2

164

H /D I n c o m e $ 6 0 , 0 0 0 - $ 7 4 , 9 9 9

22279

1757

10.2

7.9

91 88

H /D In c o m e $ 5 0 , 0 0 0 - $ 5 9 , 9 9 9

19004

1451

8.4

7.6

H /D In c o m e $ 4 0 , 0 0 0 - $ 4 9 , 9 9 9

21816

1662

9.7

7.6

88

H /D In c o m e $ 3 0 , 0 0 0 - $ 3 9 , 9 9 9

24055

1688

9.8

7

81

H /D I n c o m e $ 2 0 , 0 0 0 - $ 2 9 , 9 9 9

25327

1794

10.4

7.1

82

H /D I n c o m e $ 1 0 , 0 0 0 - $ 19,999

24406

1363

7.9

5.6

65

H /D I n c o m e L e s s th a n $ 1 0 ,0 0 0

14292

6 67

3.9

4.7

54

C e n s u s R e g io n : N o r th e a s t

39250

3858

22.4

9.8

1 14

C e n s u s R e g io n : N o rth C e n tra l

46071

4381

25.4

9.5

1 10

C e n s u s R e g io n : S o u th

70545

4966

28.8

7

C e n s u s R e g io n : W e s t

43573

4014

23.3

9.2

82 107

M a r k e t i n g R eg.: N e w E n g la n d

10172

1340

7.8

13.2

153

M a r k e t i n g R eg .: M id - A tla n t ic

3 2601

3051

17.7

9.4

108

M a r k e t i n g R eg.: E a st C e n tra l

26616

2182

12.7

8.2

95

M a r k e t i n g R eg .: W e s t C e n tr a l

30192

2844

16.5

9.4

109

M a r k e t i n g R eg.: S o u th e a s t

38789

2667

15.5

6.9

80

M A R K E TIN G A N D RESEARCH

249

TABLE 9.7 Continued M a r k e tin g R eg .: S o u t h w e s t

22644

1558

9

6.9

80

M a r k e tin g R eg .: Pacific

38424

3577

20.8

9.3

108

M S A C e n tr a l C ity

67669

5952

3 4 .6

8.8

102

M S A Suburban

93169

8548

4 9.6

9.2

106

N on-M SA

38599

2719

15.8

7

82

114055

1 1668

67.8

10.2

118

H o u s e h o ld size: 1 P e rs o n

26674

2412

14

H o u s e h o ld size: 2 P e rs o n s

68888

717 5

41.7

H o u s e h o ld size: 3 o r M o r e

10 38 76

7632

44.3

7.3

85

15224

8 42

4 .9

5.5

64

M a r ita l S tatu s: M a r rie d

A n y C h ild in H H : U n d e r 2 y ears

9

105

10.4

121

A n y C h ild in H H : 2 - 5 Y e a rs

29840

1779

10.3

6

69

A n y C h ild in H H : 6 - 1 1 Y e a rs

40268

2688

15.6

6.7

77

A n y C h ild in H H : 1 2 - 1 7 Y e a rs Hom e O wned ♦ H a v e C a b le T V

39005

2946

17.1

139215

13899

80.7

87 1 16

90

0.5

6.1

70

H ave Pay TV

19507

1472

8.5

7.5

87

H e a v y C a b le V i e w i n g ( 1 5 + H rs )

21039

1415

8.2

6.7

78

288

1.7

8.2

95

♦ A & E T e l e v i s io n N e tw o r k

1487*

7.6 10

3493*

A m e r i c a n M o v i e C la s s ic s

19371

1521

8.8

7.9

91

C a r to o n N e tw o r k

23637

1624

9.4

6.9

80

C M T ( C o u n tr y M u s ic T V )

13764

1006

5.8

7.3

85

CNBC

46017

3780

8.2

95

CNN

2 1341

1565

C o m e d y C e n tra l

13122

855

C ourt TV

47833

T h e D is c o v e r y C h a n n e l

21949

E! E n t e r t a i n m e n t T e le v i s io n ESPN ESPN2

22 9.1

7.3

85

5

6.5

75

3584

20.8

7.5

87

1398

8.1

6.4

74

60645

5729

33.3

9.4

109

20535

1666

9.7

8.1

94

16341

1927

11.2

1 1.8

137

F o x F a m i ly C h a n n e l

2968

41 3

2.4

13.9

161

Fox N e w s C hannel

4107

223

1.3

5.4

63

G a m e S h o w N e tw o r k

4368

7 08

4.1

16.2

188

♦ H e a d l in e C N N N e w s

1259*

187

1.1

14.8

172

H isto ry C h a n n e l

1546

32 6

1.9

21.1

245 113

H o m e & G arden TV

22695

2211

12.8

9.7

L ife tim e

40824

30 2 8

17.6

7.4

86

M SN B C News

25937

2821

16.4

10.9

126

MTV

25752

1186

6.9

4 .6

53

N ic k at N ite

19507

1472

8.5

7.5

87

N i c k e lo d e o n

21039

1415

8.2

6.7

78 91

S c i- F i C h a n n e l

19371

1521

8.8

7.9

TBS

50814

3677

2 1.4

7.2

T h e T ra v e l C h a n n e l

10078

1007

5.8

T L C (T h e L e a r n i n g C h a n n e l)

31998

2618

15.2

10 8.2

84 116 95

250

CHAPTER 9

TABLE 9.7 C ontinued

C o n tr ib u te d to P u b lic B r o a d c a s t T elevisio n in P a st 12 M o n th s R e p o r t B a se: A d u lts M e d ia m a r k R ec re a tio n V olum e S p rin g 2 0 0 0

* Popu-

*A

la t ion Contr.

B P erc en t-

B ase:

to P u b lic

age

A d u lts ( 000 )

TV ( 000 )

Down

C P ercent-

D In d ex

age Across

C o p y r ig h t 2000, M e d ia m a r k R ese a rc h Inc. (A d d 0 0 0 to e n d o f n u m b e rs in Pop. & A C o lu m n s) * S a m p le size f o r this item is less than 50 T N N (T h e N a sh v ille N e tw o rk )

23637

1624

9 .4

6.9

T u rn e r C lassic M o v ie s

13764

1 00 6

5.8

7.3

85

T N T (T u rn e r N etw . T elev isio n )

46017

3780

22

8.2

95 75

80

TV Land

13122

855

5

6.5

U S A N etw o rk

47833

3584

2 0 .8

7.5

87

VH1

21949

13 9 8

8.1

6.4

74

The W eather C hannel

60645

5729

3 3 .3

9.4

109

W G N -T V

20535

1 66 6

9 .7

8.1

94

A c c e ss Internet M a g a z in e

16341

1927

11.2

11.8

137

A m e ric a n L eg io n

2968

413

2 .4

13.9

161

A m e ric a n R iflem an

4107

223

1.3

5.4

63

♦ A m e ric a n W ay

11 0 8 *

184

1.1

16.6

193

A rch itectu ral D ig est

4368

708

4.1

16.2

188

998

271

1.6

27.1

314 245

A tlan tic M o n th ly A udubon

1546

326

1.9

21.1

A u to m o b ile

3867

293

1.7

7 .6

88

B a r r o n ’s

1127

271

1.6

24.1

279

B etter H o m es & G ard en s

33591

3523

2 0 .5

10.5

121

B on A p p etit

5268

888

5 .2

16.9

195

B u sin ess W e e k

4263

700

4.1

16.4

190

C a th o lic D ig e st

2577

366

2.1

14.2

165

C h icag o T rib un e M agazine

2765

446

2 .6

16.1

187

C o n d e N ast T rav eler

2 57 1

406

2 .4

15.8

183

C o n s u m e r R ep o rts

15863

2170

1 2.6

13.7

158

C o n s u m e r s D ig est

6318

719

4 .2

11.4

132

♦C on tin en tal

1519*

192

1.1

12.6

146

C o o k in g L ig h t

6536

864

5

13.2

153

C osm op olitan D e l t a ’s S K Y M a g a z i n e D isco ver

15472

995

5 .8

6.4

2465

324

1.9

13.1

152

74

6209

615

3.6

9.9

1 15

10588

801

4 .6

7 .6

88

E ll e

3783

283

1.6

7.5

87

E ntertain m en t W eek ly

8 16 1

638

3.7

7.8

91

Essence

7067

627

3.6

8.9

103

21086

2033

11.8

9 .6

1 12

Ebony

F a m i l y C ir c l e

M A R K E TIN G A N D RESEARCH

251

TABLE 9.7 Continued Field & S tream

11069

553

3.2

5

52 2 4

466

2.7

8.9

F o o d & W in e

4195

6 19

3.6

14.8

171

F o rb e s

4472

68 6

4

15.3

178

F l o w e r & G a rd e n

F o rtu n e

58 103

3722

5 53

3.2

14.9

10826

610

3.5

5 .6

65

G o l f D ig e s t

5759

64 9

3.8

11.3

131

G o lf M agazine

5856

78 5

4 .6

13.4

155

♦ G o l f W o rld

1 447^

2 12

1.2

14.7

170

23312

2085

12.1

8.9

104

G ourm et

4724

69 3

4

14.7

170

G Q ( G e n t l e m e n ’s Q u a rte r ly )

6195

40 4

H a r p e r ’s B a z a a r

2799

33 7

2.3 2

H e a lth

5490

51 2

3

9.3

108

H e m i s p h e r e s (U n ite d )

1507

25 2

1.5

16.7

194

Home

3936

29 2

1.7

7 .4

86

H ouse & G arden

1 1292

1162

6.7

10.3

119

H o u s e B e a u tifu l

6351

9 19

5.3

14.5

168

In S tyle

4941

491

2.9

9.9

115

♦Inc.

172 8 +

22 4

1.3

Jet

7997

49 2

2.9

6 .2

71

K i p l i n g e r ’s P e r s o n a l F in a n c e

2969

56 8

3.3

19.1

221

14507

1431

35 8 2

5 18

G lam o u r

G o o d H o u s e k e e p in g

L a d i e s ’ H o m e Jo u r n a l L o s A n g e le s T i m e s M a g a z i n e

6.5 12

13

172

75 139

150

9.9

114

3

14.5

168 185

8.3

M acw orld

1912

305

1.8

15.9

M adem oiselle

5147

398

2.3

7.7

90

10491

1290

7.5

12.3

142

M e n ’s F itn e s s

4931

4 25

2.5

8.6

100

M e n ’s H e a lth

7819

8 30

4.8

10.6

123

♦ M e n ’s Jo u r n a l

1787*

178

1

9.9

115

M e t r o p o li ta n H o m e

2548

44 9

2.6

17.6

204

M i d w e s t L iv in g

2546

383

2.2

15

174

15117

2397

13.9

15.9

184

M oney

7507

1146

6.7

15.3

177

M o t o r T re n d

6599

47 5

2.8

7.2

83

M u s c le & F itn e ss

6960

431

2.5

6.2

72 128

M a r t h a S te w a r t L iv i n g

M o d e r n M a tu rity

271 1

3 00

1.7

11.1

N a tio n a l E n q u ir e r

12133

75 3

4.4

6.2

72

N a tio n a l G e o g r a p h ic

30258

3612

11.9

138

4310

676

3.9

15.7

182

M utual Funds

N a tio n a l G e o g r a p h i c T r a v e l e r N a tu ra l H isto ry N ew sw eek

21

1533

357

2.1

23.3

270

19130

2606

15.1

13.6

158

♦ N e w Y o rk M a g a z i n e

10 7 4 +

165

1

15.4

178

N e w Y o rk T im e s (D a ily )

2769

62 9

3.7

22.7

26 3

2 52

C H A P TE R 9

TABLE 9.7 Continued C o n t r i b u t e d to P u b l i c B r o a d c a s t T e l e v i s i o n in P a s t 12 M o n t h s R ep o rt B ase: A d u lts M e d ia m a r k R ec re a tio n V o lu m e S pring 2000

♦ Popu-

*A

la tio n C o n tr .

B P ercen t-

Base:

to P u b l i c

age

A d u lts

TV

Down

( 000 )

( 000)

C P erce n t-

D Index

age A cross

C o p y rig h t 2000, M e d ia m a rk R e s e a r c h In c . ( A d d 0 0 0 to e n d o f n u m b e r s in P o p . & A C o l u m n s ) * S a m p l e s i z e f o r t h is ite m is l e s s t h a n 5 0

N e w Y o r k T im e s ( S u n d a y )

3939

887

5.2

22.5

261

T he N ew Y orker

2767

650

3.8

23.5

27 2

♦N orthw est W orld T raveler

15 17 ♦

260

1.5

17.1

198

O r g a n ic G a r d e n in g

3480

511

3

14.7

170

O u t d o o r Life P a ra d e P a re n tin g P a re n ts’ M agazine

5365

4 15

2.4

7.7

90

79858

8542

4 9 .6

10.7

124

9612

5 39

3.1

5.6

65

12424

7 09

4.1

5.7

66

PC M agazine

6647

74 9

4.4

11.3

131

P C W o rld

6553

6 92

4

10.6

122

34469

3083

17.9

8.9

104

8389

790

4.6

9.4

109

P e o p le P o p u lar M echanics P o p u l a r S c ie n c e

5962

576

3.3

9.7

112

P re v e n tio n

9684

1124

6.5

11.6

134

Psychology T oday R e a d e r ’s D ig e s t

3035

2 97

1.7

9.8

113

44264

4611

26.8

10.4

121

Redbook

9797

77 8

4.5

7.9

92

R o a d & T ra c k

4772

450

2.6

9.4

109

R o llin g S to n e

8445

45 9

2.7

5.4

63

S cien tific A m e r i c a n

3086

45 5

2.6

14.7

171

S e lf

4096

4 88

138

4841

350

2.8 2

11.9

S e s a m e S tr e e t P a re n ts

7.2

84

S e v e n te e n

8069

4 93

2.9

6.1

71

Shape

4533

378

2.2

♦Ski

1348^

189

1.1

♦ S k iing

1 00 9^

97

0.6

9 .6

Sm art M oney

2914

4 84

2.8

16.6

192

S m i th s o n ia n

7060

1375

8

19.5

226

S o a p O p e r a D ig e s t

6820

420

2.4

6.2

71

♦Soap O pera W eekly

4614^

174

1

3.8

44

S o u th e r n L iv in g ♦ S o u th w e s t Sp irit

12621 1878 ♦

8.3 14

97 162 112

1345

7.8

10.7

123

378

2.2

20.1

23 3

1586

9.2

7.6

88

♦ S tar

7169^

329

1.9

4.6

53

Sunset

4402 4 9 40 +

7 82

4.5

17.8

206

339

2

6.9

79

S p o rts Illu strated

♦ T ee n

20833

M A R K E T I N G A N D RESEARCH

253

TABLE 9 . 7

Continued ♦Tennis

1015 ♦

185

1.1

18.3

♦T exas M onthly

1 8 54 *

204

1.2

11

127

21663

2780

16.1

12.8

149 165

T im e

212

T o w n & C ountry

2918

416

2.4

14.3

T raditional H o m e

2869

313

1.8

10.9

126

T ravel & Leisure

4783

781

4 .5

16.3

189

T V G uide

32692

2217

12.9

6.8

79

U .S . N e w s & W o r l d R e p o r t

1 0 0 70

1 397

8.1

13.9

161

11

127

USA Today

4374

480

2.8

44966

4541

2 6 .4

10.1

117

V anity Fair

4866

506

2.9

10.4

120

V ictoria

2637

408

2.4

15.5

179

Vogue

8953

714

4.1

8

92

♦W alking M a g azin e

2084#

286

1.7

13.7

159

U SA W eekend

W all Street Jo u rn al

3588

800

4.6

22.3

258

W ashington Post (Sunday)

2536

381

2.2

15

174

19781

1 612

9.4

8.2

94

7782

654

3.8

8 .4

97

♦W orking M oth e r

2430 ♦

228

1.3

9 .4

109

♦W orking W o m an

2409 +

300

1.7

12.5

144

Y ankee

2688

472

2.7

17.5

203

W o m a n ’s D a y W o m a n ’s W o r l d

s e c o n d a r y r c s c a rc h r e v i e w on c o n tr ib u t o r s to p u b lic T V an d y o u r m a r k e t o r city. (N o te. P u b li s h e d so u r c e s o f s e c o n d a r y o r s y n d i c a te d r e s e a rc h te nd to h a v e in ­ stru c tio n s on h o w to u se an d in te rp re t the ir d a ta at the b e g in n i n g o r en d o f the r e ­ p o rt or in a se p a r a te p a m p h l e t o r p u b lic a tio n th a t m a y a c c o m p a n y the report. S o m e in c lu d e in s tru c tio n s , a d v ic e , o r a n s w e r s to f r e q u e n tly a s k e d q u e s t io n s |F A Q s ] on th e ir W e b sites.)

A S S IG N M E N T W r i te a rep ort d e ta ilin g the p r i m a r y ta r g e t s e g m e n t o f c o n tr ib u t o r s to p u b lic T V n a ti o n w i d e , in c l u d in g d e m o g r a p h i c s , g e o g r a p h i e s , p s y c h o g r a p h ic s , an d

any

o t h e r in f o rm a t io n y ou find. Id e n tify a n d d e s c r ib e the m a j o r p o te n tia l c o rp o r a te c o n tr ib u t o rs or s u p p o r te r s in y o u r city (in c lu d in g the m a j o r c o m p a n i e s and in ­ d u s trie s lo c a te d th ere). T h e n w rite a p r o p o s a l fo r a re s e a rc h p r o j e c t to ass ess w hy y o u r m o s t r e c e n t fu n d r a is i n g c a m p a i g n w a s u n s u c c e s s f u l an d w h e t h e r lo cal c o n ­ trib u to rs h a v e s i m i la r c h a ra c te ris tic s to c o n tr ib u t o rs n a tio n a lly . In c lu d e e a c h o f the f o l lo w in g s e c tio n s in y o u r final re p o r t an d re s e a rc h p ro p o s a l. 1. P ro vid e a description and analysis o f the target se g m e n t o f co ntribu tors to public T V . Include all m a jo r ch aracteristics in clu din g d e m o g r a p h ic s , g e o ­ graph ies, and psy ch o g ra p h ics. If possible, identify how m a n y person s or

254

CHAP T E R 9

h o u seh o ld s a p p e a r to be in the m a jo r public T V co ntrib uto rs target seg m en t (e.g., the n u m b e r o f h o u se h o ld s in y o u r city h eaded by p erso ns 45 to 64 years old h av in g in co m es o f $ 7 5 ,0 0 0 and o v e r from the L M A ). W rite a d etailed and concise rep ort on the target se g m e n t o f national public T V contributors. 2. P ro v i d e a d eta ile d , y et c o n c is e d e s c r ip tio n o f y o u r m a r k e t area o r m a j o r city. P ro v i d e in f o rm a tio n a b o u t the c i t y ’s m a j o r e c o n o m i c c o n d itio n s , in ­ d u strie s , c h a ra c te ris tic s , an d so on. T h e go al is to d e s c r ib e y o u r city a c c u ­ rately, d e s c r ib e

lo cal e c o n o m i c

c o n d it io n s , an d

id e n tify

m ajor

local

in d u s trie s, c o m p a n i e s , and so on (and id e n tify an d d e s c r ib e p o te n tia l c o r ­ p o ra te c o n tr ib u t o rs in the n e x t q u e stio n ). 3. P ro v id e a d e ta ile d , y e t c o n c is e d e s c r ip tio n o f p o te n tia l c o rp o r a te c o n t r i b u ­ tors. Id e n tify th e m a j o r c o m p a n i e s and in d u s trie s in y o u r city, an d d e s c r ib e h o w an d w h y each m i g h t b e p e r s u a d e d to c o n tr ib u t e to o r s u p p o r t y o u r lo cal p u b lic T V station. 4. W rite a re s e a rc h p ro p o s a l to d is c o v e r w h y y o u r m o s t r e c e n t f u n d r a is in g c a m p a i g n w a s n o t as su c c e s s fu l as h o p e d an d the c h a ra c te ris tic s o f p re s e n t an d p o te n tia l lo cal in d iv id u a l c o n tr ib u t o r s (o r w h e t h e r th e y are s i m i la r to the n a tio n a l ta r g e t s e g m e n t o f in d i v id u a l s w h o c o n tr ib u t e to p u b lic T V ) . D e v e lo p a p art o f y o u r r e s e a rc h p ro p o s a l to d is c o v e r the m a j o r lo c al c o m ­ p a n ie s and in d u s trie s w h o h a v e /h a v e n o t c o n tr ib u t e d to the local p u b lic T V s ta tio n a n d w h y . Y o u r resea rch p ro p o s a l s h o u ld d iscu ss the m a j o r asp ects o f the m a r k e tin g r e ­ search p ro cess, in c lu d in g research q u e stio n s, a s e c o n d a r y re searc h rev ie w , p rim a ry rese arch d esig n, data -c o llectio n p ro c e d u re s, sa m p lin g d esig n, da ta collection , data p ro c e s sin g and an alysis, re p o rt w riting , and p oten tia l re s earch firm s to co n tac t a b o u t c o n d u c tin g the study. Id entify local o r nation al re s earch firm s y o u m ig h t hire to c o n d u c t the research yo u p ro p o s e. E x p lain w h y the re s ea rch c o m p a n y or c o m p a n i e s are q ualified and ap p ro p ria te ch o ic e s for the type o f stu dy y o u p ro p o s e to c o n d u ct. Id entify w h ic h research c o m p a n y is the best to hire to c o n d u c t y o u r r e ­ search an d w h y . P ro v id e an a p p e n d ix in y o u r rep o rt th at in c lu d e s e x a m p l e s o f the ty p es o f q u e stio n s to ask in d iv id u a l an d co rp o r a te c o n trib u to rs in y o u r study.

Case 9.3 D ev e lo pin g A N e w M ag az in e A s s u m e y o u w o rk at a m a j o r n atio n a l m a g a z in e p u b li s h i n g firm. Y o u r task is to d e v e lo p a p r o p o s a l for a n ew m a g a z in e . Y o u r m a g a z in e m a y h a v e a n a tio n a l a u ­ d ie n c e or be ta r g e te d to a c e rta in re g io n (e.g., S o u th e r n Liv in g , M i d w e s t L i v i n g ), state (e.g., T e x a s M o n t h l y ), o r city. Y o u m a y p r o p o s e a g e n e ra l in te re st m a g a z in e o r o n e tailo red to a c e rta in in te re st s e g m e n t (e.g., F ie l d & S tr e a m , G o u r m e t , etc.). Y o u r p r i m a r y c rite ria a re that a s ig n ific a n t an d v ia b le a u d ie n c e s e g m e n t an d g r o u p o f m a j o r a d v e rt is e rs ex is t to s u p p o r t the m a g a z in e . Y o u m u s t p ro v id e

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s u p p o r tiv e d a ta th a t are re alistic an d s u g g e s t th e m a g a z in e y o u p r o p o s e c o u ld s u r v iv e an d p ro s p e r. Y o u m i g h t b e g in by e v a lu a tin g d ata su c h as m a g a z in e la u n c h e s by c a te g o ry , g r o w th o f m a g a z in e s by c a te g o ry , n u m b e r o f m a g a z in e s by c a te g o ry , and n u m ­ b e r o f ed ito ria l p a g e s by s u b j e c t at the M a g a z i n e P u b li s h e r s o f A m e r i c a ( M P A ) h o m e p a g e ( w w w . m a g a z i n e . o r g ). M P A p u b li s h e s th e M a g a z i n e H a n d b o o k w ith a v a rie ty o f u sefu l d a ta a v a ila b le for d o w n l o a d i n g ( h t t p : / / w w w . m a g a z i n e . o r g / r e s o u r c e s / d o w n l o a d s / M P A _ H a n d h o o k _ 0 1 . p d f) . M P A ’s P u b li s h e rs I n f o rm a t io n

B u r e a u ( w w w . m a g a z i n e . o r g / p i b ) p ro v i d e s in f o r m a t io n a b o u t a d v e rtis in g r e v ­ e n u e , h is to ric a l tren d s, p a g e s , and so o n o n lin e . If y o u r lib rary h a s the a p p r o p r i ­ ate vStandard R ate a n d D a ta S e rv ic e p u b li c a ti o n (e.g., S R D S C o n s u m e r M a g a z i n e A d v e r ti s in g S o u r c e o r B u s in e s s P u b lic a tio n A d v e r ti s in g S o u rc e ) , r e v ie w it to see w h ic h m a g a z in e s a lr e a d y ex is t in the c a te g o rie s y o u are c o n s i d e rin g , w h a t their ed ito rial d e s c r ip ti o n s are, th e ir r e g u l a r fe a tu re s an d se c tio n s , w h o th e y ta rget, h o w m u c h th ey c h a r g e for a d v e rtis in g , an d so on. F o l i o ( w w w . f o l i o m a g . c o m ) p r o v i d e s in f o r m a t io n a b o u t n e w la u n c h e s , m a g a z in e a d v e rtis in g , an d o th e r in ­ d u stry in s ig h ts th at m a y b e h e lp f u l in d e v e lo p i n g a m a g a z in e p ro p o s a l. A d v e r t i s ­ ing in d u s try p u b li c a ti o n s like A d v e r t i s i n g A g e ( w w w . a d a g e . c o m ) often p u b lish article s o r d a ta a b o u t m a g a z in e s . C o n d u c t a s e a r c h o n A B I I n f o r m / P r o Q u e s t, L e x is - N e x i s A c a d e m i c U n iv e rs e , o r E b s c o to find o t h e r article s and d a ta o n m a g ­ a z in e la u n c h e s and the m a g a z i n e ind ustry . O n c e yo u h a v e n a r r o w e d y o u r id e as to a few c a te g o rie s , e v a lu a te the rele v a n t da ta in M e d i a m a r k , S i m m o n s , an d the S R D S L ife s ty le M a r k e t A n a ly s t ( L M A ) if a v a ila b le . F o r e x a m p l e , if y ou are c o n s i d e r in g a m a g a z in e ta r g e te d to do g o w n ­ ers, c h e c k d o g fo o d p r o d u c t sales d a ta in M e d i a m a r k a n d /o r S i m m o n s . T h e n r e ­ v ie w the d e m o g r a p h i c s , g e o g r a p h i e s , an d m e d i a u s a g e d a ta fo r p e o p le w h o b uy d o g fo o d . T h e s e re p o r ts c o n ta i n the b ra n d n a m e s o f m a j o r c o m p a n i e s in the c a t e ­ g o ry (e.g., m a j o r d o g fo o d c o m p a n i e s like P u rin a a n d l a m s an d the b r a n d s they m a k e ) . W rite d o w n th o s e c o m p a n y and b ra n d n a m e s an d lo ok in C M R ’s A d $ S u m m a r y if it is a v a ila b le in y o u r c a m p u s lib ra ry (it lists b r a n d s an d p a r e n t c o m ­ p a n ie s plu s the a m o u n t th e y s p e n t in m a j o r m e d i a d u rin g the p a s t y e a r a l p h a b e t i ­ cally in the b ra n d in d e x ; also c h e c k fo r s p e n d in g d a ta fo r the c a te g o r y in the v o lu m e ). C h e c k to see w h ic h m a j o r a d v e rtis e rs a d v e rt is e d in m a g a z in e s an d c o p y the n a m e s an d a m o u n t s o f th o se th at did. C o n d u c t a s e a r c h o f th o s e m a j o r a d v e rtis e rs in A B I I n f o r m / P r o Q u e s t, L e x is - N e x i s A c a d e m i c U n iv e r s e , o r E b s c o to find o u t h o w m u c h they s p e n t an d in w h ic h m a g a z in e s th ey a d v e rtise d . T h e n r e v ie w the L M A lifestyle s e g m e n t O w n A D o g (o r the a p p ro p r ia t e s e g ­ m e n t for the ty p e o f m a g a z in e y o u p ro p o s e ). T h e r e y o u w ill find d e m o g r a p h i c d a ta on d o g o w n e r s (o r y o u r life sty le s e g m e n t) n a ti o n w i d e a n d in f o rm a t io n a b o u t the o th e r lifestyle a c tiv ities th ey e n jo y . T h is h e lp s y o u id en tify p o te n tia l fe a tu re s o r s e c tio n s an d o th e r p o te n tia l a d v e rtis e rs fo r y o u r p r o p o s e d m a g a z in e . R e v ie w the in s tru c tio n s at the fro n t o f the L M A v o lu m e to see w h e t h e r th e re is o th e r in f o r m a t io n o f in terest. If y o u a re th i n k in g a b o u t p r o p o s in g a city m a g a z in e ,

256

CHAP T E R 9

c h e c k o u t the L M A d e m o g r a p h i c and p s y c h o g r a p h ic d ata fro m the m a r k e t p r o ­ files se c tio n to get id eas an d d ata to he lp ju s ti f y y o u r c h o ic e s o f s e c tio n s an d f e a ­ tu re s to offer. T h e n v isit a lo ca l lib rary , b o o k s t o re , o r n e w s s t a n d to r e v ie w c o p ie s o f ex isting m ag a z in e s in y o u r p ro p o s ed catego ry. C h e c k their W e b sites. R eview their sections, advertisers, rate in fo rm atio n , and so on. A lso search the A dv ertising M ed ia Internet C e n te r ( w w w .a m ic .c o m ) and M R I + online d ata b a se ( w w w . m r i p l u s . c o m ) if d e s ire d (y ou w ill n e e d to re g is te r to u se th e s e sites). In o th e r w o rd s , find and e v a lu a te as m u c h in f o rm a t io n , re s e a rc h , and d a ta as p o s s ib le to d e v e lo p a th o r o u g h m a g a z in e p r o p o s a l and a c o m p r e h e n s i v e u n d e r ­ s ta n d in g o f the c a te g o ry in w h ic h y o u w ish to la u n c h y o u r m a g a z in e . A s k y o u r p ro f e s s o r fo r s u g g e s tio n s o f av a ila b le in f o r m a t io n so u r c e s o r d a ta b a s e s to use. T r y to th in k o f an y o t h e r s o u r c e s o f d a ta o r in f o rm a t io n . C o n d u c t a c o m p r e h e n ­ siv e s e a r c h fo r so u r c e s in y o u r c a m p u s lib rary u sin g d a ta b a s e s and o n lin e search e n g in e s like G o o g l e o r Y a h o o . R e v ie w T a b le s 9.3 th r o u g h 9.6 fo r o th e r s o u r c e s to e x p lo r e . U se y o u r im a g in a t io n to d e v e lo p o rig in a l an d u sefu l in f o rm a t io n to in c lu d e in y o u r p ro p o s a l.

A S S IG N M E N T A f te r c o n d u c ti n g a th o r o u g h and d e ta ile d in f o rm a t io n s e a r c h , w rite a p r o p o s a l to start a n e w m a g a z in e . Y o u m u s t s u p p o r t y o u r p r o p o s e d m a g a z in e an d r e c o m ­ m e n d a t io n s w ith in f o rm a tio n an d data. Y o u r p ro p o s a l m u s t in c lu d e eac h o f the f o l lo w in g sectio n s. 1. A title and o v e ra ll d e s c r ip ti o n o f the p r o p o s e d m a g a z in e , in c lu d in g its e d i ­ torial m i s s i o n an d d e s c r ip tio n s , fe a tu re s an d se c tio n s, t y p e s o f a rtic le s to in c lu d e , an d so on. E x p la i n w h y y o u p r o p o s e the title y ou s elected . P r o ­ v id e as m u c h d etail as y ou can a b o u t the p ro p o s e d m a g a z in e an d its c o n ­ tent. P ro v i d e da ta an d

in f o rm a tio n

to s u p p o r t w h y y o u se le c te d the

m a g a z in e , m a g a z in e ty p e, and m a g a z in e c a te g o ry y o u se le c te d fo r y o u r p ro p o s a l. E x p la i n h o w a n d w h y it is d if fe re n t fro m o t h e r ex is tin g m a g a ­ zin es in the c a te g o ry . Id e n tify the un filled n ich e o r p o sitio n it fills. M a k e a stro n g c a se b a s e d on a c tu a l r e c e n t d a ta an d in f o rm a tio n . 2. Id en tify and d e s c r ib e y o u r targ et s e g m e n t o f r e a d e r s in as m u c h detail as p o ss ib le . P ro v i d e an e stim a te o f the n u m b e r o f p o te n tia l r e a d e r s o r s u b ­ sc rib e rs n a t i o n w i d e (e.g., the n u m b e r o f p e r s o n s o r h o u s e h o l d s o w n in g a d o g fro m the L M A ) o r in y o u r re g i o n , state, o r city o f interest. P ro v id e as m u c h d e tail as p o s s ib le a b o u t the m a j o r c h a ra c te ris tic s o f y o u r targ et s e g m e n t o f p o te n tia l s u b s c r ib e r s or re a d e r s , in c lu d in g d e m o g r a p h ic s , g e o ­ g ra p h i e s , p s y c h o g r a p h ic s , and so on. E x p la in h o w an d w h y y o u r p ro p o s e d m a g a z i n e w ill be o f in te re st to y o u r targ et s e g m e n t. E x p la in h o w a n d w h y it m a t c h e s th em an d th eir in terests. P ro v id e in f o rm a t io n an d d a ta to support your recom m endations.

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3. Identify and describe a m inim um o f five potential advertising categories and exam ples o f advertisers in each (e.g., dog food advertisers like Purina and lam s for a dog magazine, etc.). Provide data on how m uch is spent in m a g a ­ zine advertising in the category. If possible, provide data for how advertising spending in the category increased ov er the past 5 years or decade (this infor­ mation m ay be available in C M R ’s Ad $ Sum m ary). Provide information about how m uch each com p any /bran d that advertises in magazines spent (or spent on advertising in general if specific magazine data are unavailable). If possible, identify the magazines in w hich these advertisers have placed ads. E xplain w hy y ou r proposed magazine will be an attractive advertising vehicle for these advertisers, providing as m uch detail, data, and support as you can.

Case 9.4 Developing an O nline M e d ia Kit

A ssu m e you w o rk for a m a jo r daily, w eekly , ethnic, o r c o m m u n ity n e w s p a p e r in yo ur tow n o r the n earest city. Y o u r jo b is to d ev elo p data to include in an online m edia kit for that paper. B egin by re v iew in g the W e b p a g e and n e w s p a p e r m edia kits for m a jo r n e w sp ap ers like T h e N e w Y o r k T i m e s ( h t t p : / / n y t a d v e r t i s i n g . n y tiin es.c o m /a d o n is/h tm l/o p en /a c lh o m e.sh tm l and h ttp ://w w w .n y tim e s .c o m / adinfo /), USA T o d a y (w w w .u sa to d a y .c o m /a d s /u s a t/in sid e _ u s a t.h tm ), C h ica g o Trib une ( w w w . tr ib u n e i n t e r a c t i v e . c o m / c h i c a g o / m e d i a k i t / h o m e .h t m ), and the T a m p a T r ib u n e / T B O .c o m / W F L A N e w s C h a n n e l 8 (h t t p : / / c l i e n t s . t b o . c o m ) to review a site with m edia kits for m ultiple m edia outlets and its rates and A d v ertiser Inform atio n G u id e (h t t p : / / t a m p a t r i b . c o m / t r i b h e l p / r a t e s / ). T h e n rev iew pertin ent info rm ation abo ut in teractive m arketing and adv ertis­ ing at the Interactive A dv ertising B u r e a u ’s ( w w w . i a b . n e t ) W e b site, including A dv ertisin g A B C s ( w w w . i a b . n e t / a d v e r t i s e / a d s o u r c e . h t m l ), w h ich dcscrib cs w ay s o f advertising an d sizes and types o f In tern et ads or Interactive M ark etin g U nits ( w w w . i a b . n e t / i a b _ b a n n e r _ s t a n d a r d s / b a n n e r s o u r c e . h t m l ), and M e a s u rin g S u cc ess ( w w w . i a b . n e t / m e a s u r i n g s u c c e s s / i n d e x . h t m l ). A lso review the E lectronic P ublishing link at the N e w s p a p e r A sso ciation o f A m e r i c a ’s h o m e page (h t t p : / / w w w . n a a . o r g ). R eview articles like “ R each in g Out: N e w s p a p e r Sites A dd A u d ie n c e ” ( w w w . n a a . o r g / a r t p a g e . c f m ? A I D = 4 3 4 2 & S I D = 10 3 ) that pro vide b a c k g ro u n d inform ation and research data to use in a m ed ia kit. N ex t review the W e b sites o f the existing m a jo r m e d ia outlets in y o u r city (e.g., th ose for TV stations, radio stations, cable outlets, m ag az in es, an d /o r other n e w s p a p e r sites). R eview the types o f in form ation and data they include as well as how they describe the benefits o f advertising in each m ed iu m o r vehicle. D e ­ velop y o u r o w n list o f pros and cons from surfing these W e b sites. O btain ideas for w h at to include, w h at not to in clude, w h at to do, and w h at not to do in the W e b site you are d e v e lo p in g for the paper.

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R e v ie w T a b le s 9 .4, 9.5, and 9.6 fo r o th e r p o s s ib le so u r c e s o f in f o rm a tio n . F o r e x a m p l e , y ou c o u ld visit th e T e le v i s io n B u re a u o f A d v e rti s in g ( w w w . t v b . o r g ) , C a b le t e le v i s io n A d v e r ti s in g B u r e a u

( w w w . c a b l e t v a d b u r e a u . c o m ), an d R a d io

A d v e r ti s in g B u r e a u ( w w w . r a b . c o m ) W e b sites to see the k in d s o f in f o rm a t io n u se d in b r o a d c a s t m e d i a kits. U s e y o u r im a g in a t io n to find o th e r so u r c e s o f i n f o r ­ m a tio n for d e v e lo p i n g a m e d i a kit.

A S S IG N M E N T D e v e lo p a p re l im in a r y m e d i a kit for y o u r p a p e r th at in c lu d e s the fo l lo w in g s e c ­ tions. P ro v id e deta ils, data, an d specific in f o rm a t io n w h e re p o ss ib le . D e v e lo p a final p ro p o s a l th a t the p a p e r ’s W e b d e s i g n e r can u se to b u ild the W e b p a g e . 1. A b o u t th e p ape r: P ro v id e b a c k g r o u n d in f o rm a t io n a b o u t the p a p e r, its m i s ­ sio n , and d e s c r ip ti o n s o f m a j o r p a g e s o r fe a tu re s on the site. 2. E d ito ria l s e c tio n s an d d e s c r ip tio n s : P ro v i d e a b r i e f o v e r v i e w o f e a c h s e c ­ tion o f the p a p e r a nd the k in d s o f articles o ften f o u n d in e a c h se ctio n . I d e n ­ tify w h e t h e r e a c h sec tio n ta rg e ts a n y specific o r sp e c ia l r e a d e r se g m e n ts . 3. E d ito ria l c a le n d a r: P r o v i d e an e d ito ria l c a l e n d a r s h o w in g w h e n s p e c ia l is­ s u e s w ill be p u b lis h e d d u rin g the y e a r ( if a v a ila b le o r a p p lic a b le ) . 4. A u d i e n c e data: P ro v i d e an a u d ie n c e p rofile o f r e a d e r s in c lu d in g d e m o ­ g ra p h ic s , p s y c h o g r a p h ic s , an d all o th e r in f o rm a t io n a v a ila b le . P r o v i d e any in f o r m a t io n y o u h a v e on r e a d e r lo y alty , h o w lo n g r e a d e r s visit th e site, and so on. 5. C o m p a r a t iv e d a ta o n o th e r lo cal m e d i a an d m e d i a ou tle ts: P ro v i d e an y i n ­ f o r m a ti o n th at iden tifies the a d v a n ta g e s o f a d v e rtis in g on the p a p e r ’s n ew W e b site v e rs u s the W e b sites o f o t h e r m e d i a ou tlets. E x p la in w h y a d v e r ­ tisers s h o u ld a d v e rtis e on y o u r p a p e r ’s site r a t h e r th an o r in ad d itio n to o th e r lo ca l W e b sites. 6. R a te in f o rm a tio n : P ro v i d e in f o rm a t io n a b o u t ra tes, a d v e rtis in g a c c e p t a b i l ­ ity s t a n d a rd s (or the w h a t a d s the p a p e r w ill/w ill not a c c e p t fo r p u b l i c a ­ tion ), an d o th e r in f o rm a t io n for sellin g the site n o t in c lu d e d in N u m b e r 7. 7. A d v e rti s in g

units:

R e v ie w

th e

I A B ’s

In te ra c tiv e

M a r k e tin g

U n its

( w w w . i a b . n e t / i a b _ b a n n e r _ s t a n d a r d s / b a n n e r s o u r c e . h t m l ) an d r e c o m m e n d

the ty p e s o f b a n n e r, s k y s c ra p e r, re c ta n g le , a n d /o r p o p - u p ad s to o ff e r for sale to a d v e rtise rs. J u s tify an d s u p p o r t y o u r ch o ic e s. 8. O b ta in i n g r e a d e r in f o rm a tio n : P ro v id e id eas a n d s u g g e s tio n s for i m p l e ­ m e n t in g w a y s to o b ta in d e m o g r a p h i c , p s y c h o g r a p h ic , o r o t h e r in f o rm a tio n fro m re a d e rs. F o r e x a m p l e , s h o u ld y o u r e q u i re r e a d e r s to re g is te r w h e n first v isitin g y o u r site and o b ta in d e m o g r a p h i c an d o th e r in f o r m a t io n th en ? W h a t o t h e r w a y s c o u ld yo u c o lle c t in f o r m a t io n fo r y o u r m e d i a kit o n lin e

M A R K E T I N G A N D RESEARCH

259

that resp ect the privacy o f y o u r read ers? W h a t exact in fo rm ation should you try to co llect (e.g., age, in c o m e, zip cod e, edu ca tion , etc.) and w h y ? 9. O th e r re c o m m e n d a tio n s: P rov id e any o th er ad vice o r g u id a n c e to the W e b page d e sig n e r for d e v e lo p in g an on lin e m edia kit for the paper. P ro vid e any o the r data, design advice, m eth od s, reso urces, and so on th at m ig ht be helpful in d e sig nin g a site th at is useful to advertisers.

Case 9.5 Dealing W ith Cable Customer Dissatisfaction

Y ou are the m a n a g e r o f the c able system in y o u r city (or the n earest city). Y ou are co n c e rn e d about the co n stan t co m p la in ts from c u sto m ers rega rd in g service. Y o u receiv ed 20 letters this w e ek alone; you sh u d d e r to think how m a n y c o m ­ plaints the rec eption ist receiv ed by p ho ne. Y ou are also c o n cern ed b e cau se the local city g o v e rn m e n t is b e gin nin g to m a k e noise ab o u t the p o o r level o f scrvicc the cablc c o m p a n y provides. Y o u d ecidc to c o n d u c t a surv ey o f sub scrib ers to identify the m a jo r scrvicc p ro b lem s and how they m ig h t be solved. Y ou h av e n ev er c o n d u cte d a survey and ca n n o t afford to hire a research firm. Y ou m u s t design a study th at can be c o n ­ ducted by you and y o u r em ploy ees.

ASSIG NMENT P repare a report d escribin g h ow you cou ld design and c o n d u c t such a survey from scratch using only c o m p a n y e m p lo y e e s and resources. Include the fo llo w ­ ing in y o u r report: 1. Identify and describe the app ro priate m eth o d to use to co n d u ct the survey and how it can be ha n d led inhouse. In o th er w ords, w h a t kind o f survey can be h and led by local cable em p lo y e e s and w h y ? 2. D iscu ss the sources o f free o r lo w -co s t inform atio n to co n su lt for d e v e lo p ­ ing y o u r c o n s u m e r survey. E xplain how these sources can be used and w h y they are a pp rop ria te for this situation. 3. E xplain how q u estio n s for the qu estio nn aire will be d evelo pe d. In oth er w o rds, how can you find ou t w h at the m a jo r pro b le m s are b efore you c o n ­ du ct the su rv ey ? H o w can you d e cid e w hich q u estio ns to in clu d e in the su rv ey and w h y ? H ow can you allow for em p lo y e e input on w hich q u e s ­ tions to inclu d e? H ow can you allow for c o m m u n ity input on w hich q u e s ­ tions to include?

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CHAPTER 9

4. Provide ex a m p le s o f the types o f q u estion s that accurately m easure w hat y o u r m ajo r serv ice p ro b le m s are. 5. S u g g e s t oth er q u estio ns to in clude, if any, besid es q u estion s reg ard in g the pro b le m s and their solutions. D escrib e the o th e r types o f q u estion s to in ­ clu de an d ex plain w hy they are needed. 6. M ak e a decision regarding the kind o f survey to con d u ct. E xplain and s u p ­ port y o u r decision.

C H A P T E R

10 B D

u d g e t in g

e c is io n

M

and a k in g

M an ag ers use several types o f inform ation to m ake decisions. T his ch apter dis­ cusses how m ed ia m a n a g e rs use ac counting inform ation for p lanning and c o n tro l­ ling o rganizational behavior. M o st people think o f accou nting as ind ecipherable co lu m n s o f n u m b e rs represen ting debits and credits. Indeed, a c cou nting in f o rm a ­ tion is often presen ted in annual reports and b u d g e ts as ro w s and c o lu m n s o f d o l­ lars and cents. Yet w itho ut a c cou nting in fo rm atio n, m a n a g e rs w o uld lack the necessary inform ation to plan and evaluate p e rfo rm a n c e ; o rg an iza tio n s w ould have poorly defined goals, if they w ere to h ave goals at all; and m an a g e ria l learn ­ ing and org an ization al g row th m igh t n ev er o ccur. C o n seq u e n tly , a cc ou ntin g p ro ­ vides essential inform ation for the day -to -day activities and long-term grow th and survival o f org anization s. M a n a g e r s can select from a w ide range o f a cco un tin g inform ation. The infor­ mation a m a n a g e r selects to use for d e cision s d e p e n d s on several factors, in c lu d ­ ing the m a n a g e r ’s level in the organ iza tion , the lon g - or short-term nature o f the decisio n, the o rg a n iz a tio n ’s size and co m p lex ity , and the nature o f the firm. R e ­ gard less o f the types o f a cco u n tin g inform ation available, o ne form o f in f o rm a ­ tion m an ag e rs use ex ten sively is the budget. T h u s, the main focu s o f this ch ap tc r is on how m a n a g e rs de v e lo p and use b u d g ets in plan n in g and co ntro lling the functions o f a m ed ia organization.

TYPES OF A C C O U N T IN G IN F O R M A T IO N A cco u n tin g activities arc div ided into financial a c co u n tin g and cou ntin g. F in ancial acco un tin g provides inform ation a b o u t an health to outsiders. M a n ag erial a c co u n tin g prov id es in fo rm ation to-day operation o f the c o m p a n y for m a n a g e rs to use in p lan ning

m an a g e ria l a c ­ o rg a n iz a tio n ’s abo ut the dayand b udgeting.

A lth o u g h both are related to m a n a g in g an org an ization , this c h a p te r con centrates prim arily on m a nag e rial accounting. 261

262

CHAP T E R 10

Financial Accounting Inform ation F in a n c i a l a c c o u n t in g refers to the p r e p a r a ti o n o f m a te ria ls , su ch as a n n u a l r e ­ p o rts, fo r use p ri m a ri ly by in d iv id u a ls e x te r n a l to the o rg a n i z a ti o n . T h e g en e ra l p u b lic , re g u la to r y a g e n c i e s , o w n e r s , in v e s to rs , c re d ito r s , ta x in g a u th o r itie s, and i n d u s try a s s o c ia ti o n s u se s u c h m a te ria ls. F o r e x a m p l e , a p u b lic m e d i a c o m p a n y ’s a n n u a l r e p o r t m a y r e v e a l th e c u ltu re a n d v a lu e s o f th a t o rg a n i z a ti o n . T h e a n n u a l r e p o r t ’s c o v e r d e s ig n , letter to s h a r e h o ld e rs , an d in f o r m a t io n a b o u t p la n n e d in ­ v e s t m e n t s an d a c q u is it io n s re v eal w h a t m a n a g e m e n t c o n s i d e r s i m p o r t a n t to the f i r m ’s lo n g - te rm su c c e s s. A ba lan c e sheet also reveals a great deal o f in fo rm atio n a b o u t a c o m p a n y . Let us c o n s id e r h ow to an aly z e a b ala n c e sh eet usin g an e x a m p l e fo r a fictitious b r o a d ­ cast g ro u p with seven T V an d tw o radio statio ns called C allas C o m m u n ic a t io n (see T ab le 10.1). T h e lo n g -term o bjectiv e o f C alla s C o m m u n ic a t io n s is prim a rily to a c ­ q uire m o re T V stations and, if po ssib le, o th e r m e d ia and c o m m u n ic a tio n s -re la te d p rop erties in the future. A n o th e r goal is to identify and acq u ire stations th at ha v e the p o ten tial for substantial lo ng -term app reciatio n and profitability. C a l l a s ’ m a n ­ a g e m e n t lo ok s for p erso n n el w h o can ag g re ssiv e ly m a n a g e these stations to m a x i ­ m iz e profits, a llo w in g the c o m p a n y to p u rc h a s e m o re stations. C a l l a s ’ seven TV stations are n e tw o rk affiliates o f A B C , C B S , N B C , or Fox. T h is b a c k g r o u n d in f o rm a tio n is im p o r t a n t fo r e v a lu a tin g C a l l a s ’ b a la n c e s h ee t, w h ic h reflects the finan cial statu s o f a c o rp o r a ti o n by listing its a ss e ts and liabilities. It s e r v e s as a sto p -a c tio n p h o to g r a p h o f a c o m p a n y on a g iv e n date. W h e n a series o f b a la n c e s h e ets are e x a m i n e d to g e th e r, th ey re v e a l h o w th e c o m ­ p a n y b e h a v e d a c ro s s tim e. T h e b a la n c e s h e e t is d iv id e d into m a j o r s e c tio n s called assets, lia bilities, and s h a r e h o l d e r ' s e qu ity. A s s e ts are r e s o u rc e s that a c o m p a n y o w n s o r th a t are o w e d to a c o m p a n y . L ia b ilitie s are a m o u n t s o f m o n e y tha t are o w e d by the c o m p a n y in s o m e fo rm to a p e rs o n o r o rg a n iz a tio n . B o th a ss ets a n d liab ilitie s ta k e m a n y f o r m s , b u t the total ass e ts m i n u s the total liabilities r e v e a l the c o m p a n y ’s fin a n ­ cial h e a lth . T h e d if fe re n c e b e tw e e n ass e ts an d liab ilitie s is s h a r e h o l d e r ’s e q u ity , w h ic h re p r e s e n ts the v alu e o f the c o m p a n y that b e lo n g s to the o w n e rs . T h e b a l ­ a n c e s h e e t ge ts its n a m e fro m the fact that assets m u s t a lw a y s e q u a l liabilities a n d s h a r e h o l d e r ’s e q u ity . S e v e ra l o f the te r m s in the b a la n c e s h e e t s h o w n in T a b le 10.1 n e e d defining . A ssets.

C u r r e n t ass ets in c lu d e m o n e y o r o th e r r e s o u rc e s th a t are e a sily c o n ­

v e rte d to m o n e y . F o r e x a m p l e , a c c o u n t s re c e iv a b le in c lu d e m o n e y o w e d the c o m p a n y fo r se r v ic e s o r p r o d u c t s re n d e r e d . In v e n to rie s are th o se o b je c ts th at can be so ld re a d ily fo r cash . In v e s tm e n t s a n d o th e r ass ets are r e s o u rc e s tha t c o m e fro m in v e s tin g o th e r re s o u rc e s . P ro p e r ty , plan t, a n d e q u i p m e n t in c lu d e land , b u ild in g s , a n d e q u i p ­ m e n t o w n e d by the c o m p a n y . B e c a u s e large m e d i a o rg a n i z a ti o n s , su c h as daily

B U D G E T I N G A N D D E C IS IO N M A K I N G

263

TABLE 10.1 C o n s o lid a te d B a la n ce Sheets fo r Callas C o m m u n i c a t i o n s D e c e m b e r 31

2001

2002

A ssets

C u r r e n t a s s e ts C ash and cash e q u iv alen ts A c c o u n t s r e c e i v a b l e , less a l l o w a n c e

$76 ,0 9 8

$444 ,6 0 2

2 0 ,8 6 9 ,2 6 3

2 1 ,6 4 5 ,9 6 0

fo r d o u b tfu l a c c o u n ts ($ 5 0 5 ,7 5 9 in 2 00 1 a n d $ 3 9 1 , 9 1 0 in 2 0 0 2 ) F il m c o n t r a c t r i g h ts

4 ,6 5 0 ,6 9 2

5,0 2 1 ,2 8 0

O t h e r c u r r e n t a s s e ts

3 ,0 8 3 ,8 1 9

7 ,8 2 7 ,9 7 2

T o t a l c u r r e n t a s s e ts

2 8 ,6 7 9 ,8 7 2

3 4 ,9 3 9 ,8 1 4

P ro p erty and e q u ip m e n t, net

2 5 ,7 0 5 ,7 0 0

2 6 .8 4 9 ,6 1 5

F i l m c o n t r a c t r i g h t s a n d o t h e r n o n c u r r e n t a s s e ts D e f e r r e d f i n a n c i n g f e e s le s s a c c u m u l a t e d

2 ,9 8 0 ,4 8 9

3 ,4 2 7 ,6 6 2

1 1 ,8 7 9 , 6 2 3

1 1,345,329

6 0 ,1 5 4 ,0 9 5

6 0 ,9 6 2 ,2 8 2

19 8 ,3 5 3 ,3 1 0

1 9 8 ,3 5 3 , 3 1 0

5 4 ,3 1 7 ,4 8 8

5 4 ,3 1 7 ,4 8 8

3 1 2 ,8 2 4 ,8 9 3

3 1 3 ,6 3 3 ,0 8 0

(2 0 ,3 7 3 ,6 7 3 )

(2 8 ,1 4 4 ,9 9 2 )

a m o r t i z a t i o n ( $ 2 , 9 4 7 , 8 3 3 in 20 0 1 a n d $ 4 , 0 4 9 , 7 2 4 in 2 0 0 2 ) I n t a n g i b l e a s s e ts G o o d w ill N e t w o r k a f f ili a ti o n s B ro a d c a st licen ses

D ep reciatio n N e t i n t a n g i b l e a s s e ts

$ 2 9 2 ,4 5 1 ,2 2 0

$ 2 8 5 ,4 8 8 ,0 8 8

$ 3 6 1 ,6 9 6 ,9 0 4

$3 6 2 ,0 5 0 ,5 0 8

L ia b ilitie s a n d s to c k h o ld e r s e q u ity (d e ficit)

C u r r e n t lia b ilitie s : A c c o u n ts p ay ab le

4 ,2 2 8 ,4 9 5

3 ,2 1 3 ,5 7 1

A c c r u e d in t e r e s t

4,4 7 6 ,4 8 8

4 ,8 5 7 ,1 0 2

O t h e r a c c r u e d li a b il it ie s

2,8 0 0 ,0 5 2

3 ,5 9 8 ,0 2 7

5 ,5 5 6 ,8 5 4

7 ,6 6 2 ,6 9 2

17,0 6 1 ,8 8 9

1 9 , 3 3 1 ,3 9 2

2 7 2 ,7 1 9 ,9 9 6

2 8 1 ,2 4 8 ,6 6 7

2 ,9 3 5 ,6 2 7

2 ,7 0 6 ,7 4 2

25 ,4 9 5 ,3 9 2

2 4 ,8 8 1 ,8 1 7

36 ,3 9 0 ,0 0 0

3 6 ,3 9 0 ,0 0 0

F il m c o n t r a c t r i g h ts p a y a b l e a n d o t h e r c u r r e n t lia b ilitie s T o t a l c u r r e n t li a b il it ie s L o ng-term debt F il m c o n t r a c t r i g h t s p a y a b l e D e f e r r e d ta x lia b ility a n d t h e r n o n c u r r e n t lia b ilitie s C o m m itm en ts R e d e e m a b l e p r e f e r r e d s to c k S t o c k h o l d e r s e q u i t y (d e f ic it) Com m on A d d itio n a l capital A c c u m u l a t e d d e fic it

6 7 ,1 7 3

69,4 2 5

3 7 ,4 9 1 ,3 6 1

3 6 ,4 3 7 ,7 1 6

(2 9 ,2 7 2 ,1 5 8 )

(3 6 ,3 0 0 .7 2 8 )

264

CHAP T E R 10

TABLE 10.1 Cont i nued

D e c e m b e r 31 2001

2002

(1,192,376)

(2,005,023)

7 ,094,000

(2,508,110)

A sse ts Less: u n e arn ed c o m p en satio n N o t e r e c e i v a b l e f r o m o f fi c e r T o t a l s t o c k h o l d e r s e q u i t y (D e fi c it )

(709,500)

$ 361,696,904

$ 362,050,508

n e w s p a p e r s an d T V statio n s, r e q u ire a la rg e fixed in v e s tm e n t, this c a te g o r y is often a larg e p o rtio n o f assets fo r th ese firms. In c o n tr a s t, m a g a z i n e s , w e e k ly n e w s p a p e r s , an d W e b sites h a v e m u c h l o w e r fixed in v e s tm e n ts . D e p re c ia tio n re p r e s e n ts the v alu e o f p ro p e r ty , p lan t, an d e q u i p m e n t u se d up in the o r g a n i z a ­ ti o n ’s o p e ra tio n . If a n e w s p a p e r o r T V station b u y s a c o m p u t e r sy s te m , a certain p e r c e n t a g e o f th at s y s t e m ’s c o st b e c o m e s d e p re c i a ti o n each y e a r u ntil the v a lu e r e a c h e s zero . O n e ca n lo o k at p ro p e r ty , p lan t, a nd e q u i p m e n t as i n v e s tm e n ts in fu tu re p ro d u c t io n . B e c a u s e th a t i n v e s tm e n t is u sed fo r p ro d u c t io n , it d e c lin e s in v alu e, w h ic h m u s t b e re p r e s e n te d on the b a la n c e sheet. G o o d w ill, p u b l i c a t i o n , a nd b r o a d c a s t rig h ts r e p r e s e n t the v a lu e o f an y legal rig h ts a c o m p a n y h as to p u b lis h o r b ro a d c a s t an d th e v a lu e o f h o w p e o p le feel a b o u t th e c o m p a n y . G o o d w i ll is the v a lu e o f the c o m p a n y ’s re p u ta tio n . A p r o b ­ lem w ith th e s e c a te g o rie s is th a t th ey are ha rd to m e a s u re . Q u ite o ften a c o m p a n y w ill figure its liab ilities and o w n e r e q u ity , an d th e d i f fe re n c e b e tw e e n th e s e tw o a n d its ass e ts w ill be g o o d w ill . J u s t as e q u i p m e n t d e p r e c i a te s , g o o d w ill h a s a lim ite d life. P e o p le w h o w a tc h T V

sta tio n s h a v e v ie w in g p r e f e re n c e s th at

c h a n g e , e s p e c ia lly w ith m u ltip le v ie w in g o p ti o n s d ue to d ir e c t satellite, cab le , a n d V C R an d D V D p la y e rs. G o o d w i ll fo r th ese p e o p le e n d s. T h is loss o f g o o d ­ w ill is a m o r ti z e d an d p la c e d in the b a la n c e s h e e t to s h o w the loss o f this asset. In re v i e w i n g C a l l a s ’ b a la n c e sh eet, m u c h o f the c o m p a n y ’s a ss e ts arc listed as i n ta n g ib le ass e ts, e s p e c ia lly n e t w o r k affiliatio ns. It a p p e a r s th at C a lla s m a y h a v e s i m p l y listed the d if fe re n c e b e tw e e n a ss e ts a n d liab ilities as in ta n g ib le assets. G iv e n the a g g re s s iv e a c q u is itio n sta n c e C a lla s tak es , o n e w o u ld e x p e c t to see a larg e a m o u n t u n d e r in ta n g ib le ass ets an d liab ilities in the b a la n c e sheet. A n y o n e c o n s i d e r in g an i n v e s tm e n t in C a lla s is w ise to be c a u ti o u s . C a l l a s ’ s ta tio n s are all V H F n e tw o rk - a ffilia te d statio ns. N e tw o r k affilia tion s are v a lu a b le b e c a u s e th e re are a lim ite d n u m b e r o f v ery h i g h - f r e q u e n c y ( V H F ) c h a n n e l s a v a ila b le in each m a r k e t. T e le v i s io n statio ns b r o a d c a s ti n g on the V H F b a n d h a v e h ad a c o m p e t it iv e a d v a n ta g e o v e r u ltra h i g h - f r e q u e n c y ( U H F ) station s. T h is a d ­ v a n ta g e h as d i m in i s h e d as v ie w in g o p ti o n s in c re a se . T h e m a j o r n e t w o r k s ’ sh are o f the n a tio n a l v ie w in g a u d ie n c e h as d e c li n e d ste ad ily . S u c h a h igh r e lia n c e on i n ta n g ib le a ss ets m a y in d ic a te a c o m p a n y in, o r p o te n tia lly in, fina ncia l tro u b le.

B UD GETING A ND DECISION M AK IN G

L ia b i li ti e s a n d S h a r e h o l d e r ' s E q u i t y .

265

C u r r e n t liabilities are d e b ts d u e

w ith in a re la tiv e ly sh o r t p e rio d o f tim e. B e s id e s the ty p ic a l sh o r t-te rm d eb ts , suc h as sa larie s, a c o m p a n y like C a ll a s h a s in te re st p a y m e n t s o n the h ig h lev el o f d e b t the c o m p a n y c a rrie s g iv e n its g o a ls o f a c q u ir in g m e d i a p ro p e r tie s. A ls o no te th e lo n g - te rm d e b t o r n o n c u r r e n t liabilities. T h e s e are lia bilities th at e x te n d for 1 y e a r o r m o re. F o r e x a m p l e , if a c o m p a n y sells b o n d s , the a m o u n t o w e d the b o n d h o ld e r s w o u ld b e n o n c u r r e n t liabilities. T h e large a m o u n t listed u n d e r lo n g - te rm d e b t also in d ic a te s th e c o m p a n y ’s lo n g - te rm g o a l o f a c q u ir in g p ro p e r tie s. F o r e x a m p l e , d u rin g the pa st ye ar, C a lla s a c q u ir e d a ra d io statio n fo r a p p r o x i m a t e ly $6 m illio n in c a sh a n d a s s u m e d c e r ­ tain liabilities. T h e p u r c h a s e p rice an d liab ilitie s are reflec ted in the lo n g - te rm d e b t c o lu m n fo r 2 0 0 2 . A T V statio n a c q u is itio n the p r e v i o u s y e a r is reflected in the 2001 lo n g - te rm debt. O b v io u s l y the o w n e r s a n d s to c k h o ld e r s b e lie v e th at these station p u r c h a s e s will p a y o f f o v e r the lo n g term ; o th e r w i s e th e y w o u ld be u n w ill in g to a c q u ir e so m u c h debt. T h is d e b t is refle cted in the s h a r e h o l d e r ’s or s t o c k h o l d e r ’s e q u ity sec tio n , w h ic h s h o w s a deficit. S h a r e h o l d e r ’s o r s t o c k h o l d e r ’s e q u ity re p r e s e n ts the r e ­ so u r c e s o f the c o m p a n y th a t b e lo n g to th e o w n e r s in o n e w a y o r an o th e r. F o r e x ­ a m p l e , if th e c o m p a n y h ad e a rn e d a profit, an y re ta in e d e a rn i n g s listed w o u ld be th e a m o u n t o f profit tha t r e m a in s in the c o n tr o l o f the c o m p a n y ’s m a n a g e r s . In the c a s e o f C a lla s C o m m u n i c a t i o n s , b o th p re f e rre d ( v o tin g ) an d c o m m o n ( n o n v o t in g ) s to c k s are listed u n d e r liabilities. S h o u ld the c o m p a n y e v e r li q u i­ d ate, the h o ld e r s o f p re f e rre d sto ck w o u ld be c o m p e n s a t e d first. P re s e n tly the s t o c k h o l d e r s ’ e q u ity is a d eficit, so a n y o n e c o n s i d e r in g an i n v e s tm e n t in C a lla s m u s t be c a u tio u s. A lth o u g h o u ts id e rs g e n e ra l ly use a b a la n c e s h e e t to e v a lu a te a c o m p a n y ’s fi­ n a n c ia l p o sitio n , a series o f b a la n c e sh ee ts ca n also h e lp m a n a g e r s . T h e y are not so m u c h g e n e ra t o rs o f in f o r m a t io n fo r d e c is io n m a k i n g as th ey are w a rn in g s i g ­ nals. B y m o n i to r in g the b a la n c e s h eets a c ro s s tim e, m a n a g e r s can s e n s e w h e th e r the c o m p a n y ’s fina ncia l p o sitio n is im p r o v i n g or d e te rio ra tin g . I f the ratio o f a ss ets to liabilities is in c r e a s in g , the c o m p a n y is d o in g w ell. If the ratio is d e c lin in g , it c o u ld be d o in g b etter. In re v i e w i n g C a l l a s ’ b a la n c e sh eets fo r 2001 a n d 2 0 0 2 , it a p p e a r s the c o m p a n y c o u ld be d o in g b e tte r b e c a u s e in ta n g ib le a ss e ts in c r e a s e d slig h tly in 2 0 0 2 . H o w e v e r , liab ilities in c r e a s e d even m o r e than assets, a n d the s t o c k h o l d e r s ’ e q u ity s h o w e d a deficit. A n o th e r item to n ote is the “ N o te re c e iv a b le from office r” listing u n d e r s t o c k ­ h o ld e r s ’ equity. T h e c o m p a n y m a d e a p e rs o n al loan to an o fficer o f the c o m p a n y with an an n u al in terest rate o f 8 %. O th e r s to c k h o ld e rs o r p o ten tial in v es to rs m ig h t legitim ately q u estio n the w is d o m o f m a k in g p e rs o n a l lo ans to officers fro m c o m ­ pa n y funds. S u c h a loan m a y indicate th at the c o m p a n y u ses q u e s tio n a b le a c c o u n t­ ing p ractices. D u rin g 2001 and 2 0 0 2 , m a k in g loan s to officers b e c a m e p art o f the scan dals in v o lv in g E n ro n , W o r l d C o m , an d sev eral o th e r large c o rp o ra tio n s. E v en G e o rg e W . B u sh benefited from a co rp o r a te loan before he b e c a m e p resident.

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CHAP T E R 10

M A NA G E R IA L A C C O U N T I N G IN F O R M A T I O N M a n a g e r ia l a c c o u n t in g e m p h a s i z e s the a c c o u n t in g in f o rm a t io n n e e d s o f the m a n a g e r fo r d a y -t o -d a y d e c is io n s . B u d g e ts an d i n c o m e s t a te m e n ts are d e v e lo p e d to aid m a n a g e r s in a s s e s s in g w h e th e r o rg a n i z a ti o n a l g o a ls are b ein g m et. B u d g e ts an d i n c o m e s ta te m e n ts are the a c c o u n t in g in f o rm a tio n f o r m a ts m o s t f r e ­ q u e n tl y u se d by m a n a g e rs .

Budgets and Incom e Statements A b u d g e t is a sta te m e n t o f the p lan n ed use and a cquisition o f financial resou rc es for m eeting specific g oals d u rin g a particu lar p erio d o f time. B u d g ets qu antify the o b ­ je c tiv e s an d specific g oals o f the m a n a g e r ’s d e p a rtm e n t or c o m p a n y . B u d g ets p ro ­ vide direction for dec ision m a k in g an d are an integral p art o f the p lan nin g pro cess. C o n se q u e n tly , b u d g e ts are used as detailed and c o o rd in ate d plans for the future. B u d g e ts also se t p e r f o r m a n c e s t a n d a rd s o r c rite ria fo r e v a lu a tio n . A n in c o m e s t a te m e n t is g e n e ra t e d at the en d o f the b u d g e te d tim e p e rio d . T h e i n c o m e s t a t e ­ m e n t reflects the actua l e x p e n d it u r e s a n d r e v e n u e s for e a c h c a te g o ry listed in the b u d g e t for the tim e p e rio d . A c o m p a r i s o n o f the b u d g e t an d i n c o m e s ta te m e n t for the s a m e tim e p e rio d a llo w s the m a n a g e r to e v a lu a te the u n i t ’s p e r f o r m a n c e and p ro v i d e s n e c e s s a ry in f o rm a t io n for c o n tr o ll in g the d e p a r t m e n t ’s fu n c tio n s. A n n u a l b u d g e ts are p re p a r e d fo r the b u s i n e s s an d e a c h o f its d e p a rt m e n t s . E a c h b u d g e t is s u b d i v id e d in to 12 m o n t h ly p e rio d s. T h e b u d g e t for th e b u s in e s s is c a lled the p ro fit o r m a s t e r b u d g e t p la n ; d e p a r t m e n t a l b u d g e ts are c a lled o p e r ­ atin g b u d g e ts . L o n g - r a n g e b u d g e ts also are d e v e lo p e d , b u t ty p ic a lly o n ly at the level o f the b u s in e s s as a w h o le . T a b le 10.2 illu strate s a m a s te r b u d g e t p lan fo r rad io station K H I T - F M , w h ic h w a s r e c e n t ly p u r c h a s e d by C a lla s C o m m u n i c a t i o n s . K H I T is a to p - 4 0 hit m u s ic statio n s e rv in g a g e o g r a p h i c area w ith a p o p u la t io n o f a b o u t 3 0 0 ,0 0 0 . T h e area in c lu d e s a m a j o r state u n iv e r s ity an d s e v e r a l s m a ll e r c o ll e g e s w ith a c o m b i n e d s t u d e n t p o p u la tio n o f a b o u t 6 0 ,0 0 0 . K H I T ’s m a r k e t s e r v e s as a re g io n a l m ed ica l c e n te r an d h a s an a u t o m o ti v e m a n u f a c tu r in g p la n t an d re g io n a l r e c o r d in g studio. A m a j o r r e g io n a l d is c o u n t g ro c e r y re ta ile r m a i n ta i n s its h e a d q u a r t e r s he re, as w e ll as a n a tio n a l in s u ra n c e and i n v e s tm e n ts c o m p a n y . T h e a r e a ’s m e d i a n in ­ c o m e , e x c lu d i n g stu d e n ts, is a b o u t $ 4 5 ,0 0 0 . T h e s u m m a r i z e d m a s t e r b u d g e t pla n d is p la y e d in T a b le 10.2 reflects the b u d ­ g et fo r the b u s i n e s s as a w h o le . T h e actu a l pro fit p lan w o u ld in c lu d e o p e ra tin g b u d g e ts fro m ea ch d e p a r t m e n t . T h e b u d g e t is c o m p r i s e d o f e x p e n s e s , w h ic h are the c o sts a s s o c ia te d w ith ru n n i n g the ra d io statio n, an d r e v e n u e s , w h ic h a re the so u r c e s o f i n c o m e fo r the statio n . T a b le 10.2 s h o w s the p r o p o s e d a llo c a tio n o f financial re s o u rc e s to the v a rio u s d e p a r t m e n t s in the ra d io station as e x p e n s e s , as w ell as the r e v e n u e s e x p e c t e d from specific s o u r c e s fo r th e c o m i n g y ear.

B UD GETING A ND DECISION M AK IN G

267

TABLE 1 0 . 2

K H IT -FM Budget Station R e v e n u e a n d E xpense Item s

Dollars

Revenues N ational/regional advertising L ocal advertising T o ta l p r o j e c t e d sa les A g e n c y and rep c o m m iss io n s O ther revenue T ota l pro jected net revenue

2 0 0,000 850,000 1 ,0 5 0 , 0 0 0 (100 ,5 0 0 ) 50,000 9 9 9,500

E xpenses D ep artm e n ta l operating expenses E ngin e erin g P ro g ram production

38,000 145,000

News

30,000

Sales

1 8 4 ,0 0 0

A d v ertisin g and p ro m o tio n G eneral adm inistration

70,000 3 0 0,000

N o n operating expenses D epreciation I n t e re s t T ota l ex p e n s e s P r e t a x p rofit

53,000 1 7 ,0 0 0 837,000 1 6 2 ,5 0 0

T h e m a j o r s o u r c e o f r e v e n u e is g e n e ra t e d fr o m the se llin g o f a ir tim e fo r a d ­ v ertisin g . T h e a d v e rtis in g r e v e n u e is c a te g o riz e d by g e o g r a p h i c so u rc e . L o c a l a d v e rtis in g a c c o u n t s fo r 8 1 % o f the s t a t i o n ’s sale s re v e n u e s , a n d n a ti o n a l/ r e g i o n a l a d v e rtis in g a c c o u n t s fo r 19% o f r e v e n u e s . T o ta l e x p e c t e d r e v e n u e is c a lc u la te d by s u b tra c tin g the sales r e p r e s e n t a t i v e s ’ c o m m i s s i o n s , w h ic h d e p e n d on the a m o u n t o f sales. M i s c e ll a n e o u s a d d itio n a l r e v e n u e is a d d e d to ca lc u la te the p ro j e c te d total r e v e n u e for the c o m i n g year. P ro je c te d o p e ra tin g e x p e n s e s are ite m iz e d b y d e p a r t m e n t an d ind icate e a c h d e ­ p a r t m e n t ’s f o r e c a ste d financial n eed s. T h e tw o ty p es o f e x p e n s e s ite m iz e d in the b u d g e t are o p e ra tin g an d n o n o p e ra tin g e x p e n s e s . O p e ra tin g e x p e n s e s in clu d e the d a y -to -d a y co sts o f r u n n in g the rad io station. T h e o p e ra tin g e x p e n s e s o f a radio station m i g h t in c lu d e the c o st o f usin g an o u ts id e n e w s service, m u s ic license fees, s u b s c rib in g to an a u d ie n c e ratin g s serv ic e, an d e m p l o y e e c o m p e n s a ti o n . N o n o p e r a ti n g e x p e n s e s in c lu d e o t h e r c o sts n o t in c u r re d fro m o p e ra tin g the statio n, s u c h as e q u i p m e n t d e p re c i a ti o n an d in terest to be p a id on a n y o u t s t a n d ­ ing loan s. D e p re c ia t io n is a c o m m o n n o n o p e r a t in g e x p e n s e b e c a u s e e q u ip m e n t lo ses its v a lu e a n d e v e n tu a lly n e e d s to b e re p la c e d . T h e d e p a r t m e n t a l o p e ra t in g an d n o n o p e r a t in g e x p e n s e s are s u m m e d to c a l c u ­ late the p ro j e c te d total e x p e n d it u r e s fo r th e c o m i n g yea r. T o ta l e x p e n s e s are

268

CHAP T E R 10

TABLE 1 0 . 3

A nnual Budget for Radio Station KHIT Station R e v e n u e a n d E xp e nse Item s

Dollars

D ollars

This Year

L ast Year A ctu a l

R ev enu e s N atio n al/reg io n al advertising

200,000

190,000

L ocal advertising

850,000

775,000

1,050,000

9 6 5,000

T o t a l p r o j e c t e d sa les A g e n c y and rep c o m m iss io n s O ther revenue T o t a l p r o j e c t e d n et r e v e n u e

(100,500)

( 9 5 ,0 0 0 )

50,000

4 0,000

9 99,500

9 10,000

E xpe n se s D ep artm en tal operating expenses E ngin e erin g Program production

38,000

3 5,000

145,000

130,000

N ews

3 0,000

30,000

Sales

1 8 4 ,0 0 0

1 8 0 ,0 0 0

A d v ertisin g and p ro m o tio n

70,000

55,000

3 00,000

298,000

D epreciation

53,000

50,000

Interest

1 7 ,0 0 0

1 5 ,4 0 0

8 3 7,000

793,400

162,500

116,600

G eneral adm inistration N ono p cratin g expenses

T ota l ex p e n s e s P r e t a x profit

s u b tra c te d fro m total net r e v e n u e s to c a lc u la te the p ro je c te d b u s in e s s profit b efo re p a y in g taxes. F o r K H I T , the e x p e c t e d profit for the c o m i n g y e a r is $ 1 6 2 ,5 0 0 . T a b le 10.3 s h o w s this y e a r ’s b u d g e t in c o m p a r i s o n w ith the p r e v i o u s y e a r ’s i n c o m e s t a te m e n t fo r ra d io statio n K H I T . A c o m p a r i s o n o f last y e a r ’s a c tu a l e x p e n s e s w ith the p ro je c te d figu res d e v e lo p e d by th e new o w n e r s h o w s s o m e i m ­ p o rt a n t d if fe re n c e s . F o r e x a m p l e , m o r e r e v e n u e is e x p e c t e d fro m lo c al an d n a ­ tio n al a d v e rtis in g sales an d o t h e r r e v e n u e . A s p e n d i n g in c r e a s e is p la n n e d for p ro g r a m p r o d u c t io n , e n g in e e r in g , a d v e rtis in g , an d p ro m o ti o n . T h e s e figu re s r e ­ flect the p la n n i n g an d d e c i s i o n - m a k i n g a c tiv ities o f se v e ra l m a n a g e r s at KH1T. T h e new sales m a n a g e r , n ew g e n e ra l m a n a g e r , an d ex is tin g p r o g r a m m i n g d i ­ r e c to r d e v e lo p e d the b u d g e t fo r th e c o m i n g y e a r o v e r the c o u rs e o f 3 m o n t h s o f d is c u s s i o n s , d a ta g a th e r in g , an d d e c is io n m a k i n g . C a lla s C o m m u n i c a t i o n s b r o u g h t in tw o n ew m a n a g e r s from o t h e r sta tio n s w ith tra ck r e c o r d s o f in c r e a s ­ ing r e v e n u e s . T h e c o m p a n y p u r c h a s e d the statio n b e c a u s e m a n a g e m e n t felt a s tro n g a d d itio n a l profit p o te n tia l w a s likely g iv e n th e larg e s tu d e n t p o p u la tio n an d d iv e rsifie d e c o n o m y in the m ark e t. P resently , the e c o n o m y is strong in the m arket, so the new m a n a g e rs w a n t to take a d v a n ta g e o f this q u ic k ly . T h e a u to m a n u f a c t u r i n g in d u s try o fte n e x p e r i e n c e d

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269

d o w n tu r n s , so p ro fits m u s t be in c r e a s e d q u ic k l y to im p r o v e p e r f o r m a n c e b efo re a n o th e r d o w n tu r n b e g in s . A ls o th e n ew m a n a g e r s w a n t to e d u c a t e lo cal and n a ­ tio n a l a d v e rtis e rs a b o u t w h y in c r e a s in g th e ir a d v e rt is i n g b u d g e ts w o u ld help th e ir b u s in e s s e s . T h e n ew sales m a n a g e r h a d s u c c e s s fu l ly r e tra in e d sales p e r s o n ­ nel b e fo r e to in c r e a s e sales a n d d e v e lo p n e w a c c o u n ts . T h e r e v e n u e p ro je c tio n s w e re b a s e d on this m a n a g e r ’s p r e v i o u s s u c c e s se s. T h e g e n e ra l m a n a g e r felt a n o t h e r stra te g y s h o u l d be d e v e lo p e d to in crease pro fit d u rin g the c o m i n g y e a r to satisfy the o w n e rs . S e v e ra l g e n e r a l s trateg ie s m i g h t be utilized : (a) th e s t a f f c o u ld w o rk h a r d e r to m a i n ta i n e x is tin g ad v e rtisin g re v e n u e s , (b) co sts c o u ld be cut, o r (c) o th e r ty p e s o f r e v e n u e c o u ld be sou g h t. T h e sales m a n a g e r w a s alread y w o rk in g on the first solution. T h e se c o n d so lu ­ tion o f co st cutting w o u ld im p ro v e the situation in the short run, b ut the long-run co n s e q u e n c e s c o u ld

affect the s tatio n ’s ratings ne ga tive ly, th ereb y

redu cing

adv ertisin g re v e n u e s in the future. B u d g e t a m o u n ts w ere in creased slightly fo r e n g i­ n eering , p ro g ram p ro d u ctio n , sales, ad v ertising , p ro m o tio n , an d g en eral a d m in is tra ­ tion to m a inta in the sta tio n ’s quality. T h e s e in creases w ere j u d g e d to be the sm allest po ssible to m ainta in qu ality an d c o v e r p lan n ed projects for the c o m i n g year. T h e n ew s d e p a rtm e n t b u d g e t w a s not in creased b e c a u se m a n a g e m e n t felt the s ta tio n ’s 18- to 4 4 -y e ar-o ld co re a u d ie n c e listened b e c a u se o f the s tatio n ’s m u s ic selections, not its n ew s co v e rag e. T h e g en eral m a n a g e r also noted that she w ou ld w o rk w ith all d e p a rtm e n t h ead s to trim the b u d g e t w h e re po ssib le w ith o u t sacrificing quality. T h e p r o g r a m m i n g h e a d , w h o w a s re ta in e d by C a lla s, p r o p o s e d an ide a to g e n ­ era te a d d itio n a l re v e n u e . T h e station w o u ld p u t its m o r n in g an d a fte rn o o n d r i v e ­ tim e p ro g r a m s on its W e b site. P e o p le w h o m i s s e d a p ro g r a m or w a n te d to listen to o n e th e y e n jo y e d a g a in c o u ld listen to the s t a ti o n ’s m o s t p o p u l a r D Js at tim e s o t h e r th an d riv e tim e . T h e h ig h e s t paid D Js w o rk d u rin g driv e tim e s , b u t p e o p le m i g h t listen to th e m at o th e r tim e s too. B y r u n n i n g the a ft e r n o o n an d m o r n in g s h o w s a g a in an d le a v in g th e m o n lin e fo r up to a w e e k , a d v e rtis e rs c o u ld h a v e a d d itio n a l e x p o s u r e . F o r a s m a ll in ­ cre a s e in th e p rice o f the d ri v e - ti m e ads, th ey w o u ld be left on th e W e b site v e r ­ sion. If the a d v e rtis e r d id n o t w a n t this o p tio n , the a d s w o u ld be r e m o v e d by ed itin g . T h e initial c o st o f d o in g this c o u ld be re la tiv e ly lo w — c o m p u t e r so f tw a re an d ti m e e d itin g the a u d io files. H o w e v e r , o v e r tim e , th e re m i g h t be g r e a t e r cost. A t the n e x t c o n tr a c t n e g o tia tio n s , the D Js m i g h t w a n t ad d itio n a l m o n e y for re u s in g th e ir m a te ria l. A ls o th ere are is su e s c o n c e r n i n g the use o f m u s ic on the In te rn et. T h e 2 0 0 2 ru lin g a b o u t m u s ic ro y a ltie s set a rate o f .14 c e n ts p e r song fo r c o m m e r c i a l statio n s fo r In te rn e t-o n ly W e b c a s t c o m p a r e d w ith .07 c e n ts p e r so n g w h e n d is trib u te d by b r o a d c a s t o r s i m u l c a s t (H a n s o n , 2 0 0 2 ). It is n o t c le a r w h ic h rate w o u ld a p p ly to a rc h i v e d p r o g r a m s , b u t K H I T m i g h t h a v e to ed it out the m u s ic an d le av e the j o k e s an d talk. T h e b u d g e t d e v e lo p e d for K H I T ’s c o m i n g y e a r r e p r e s e n ts the d e s ire d fu ture status o f the ra d io statio n b a s e d on the d e c is io n s o f the m a n a g e m e n t te a m that p re p a r e d the b u d g e t, k e e p in g the o w n e r ’s g o a ls in m in d . T h e b u d g e t p ro v id e s

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s p e n d i n g g u id e l in e s fo r th e d e p a r t m e n t h e a d s an d sets p e r f o r m a n c e e x p e c t a tio n s fo r the sale s staff. In p a rticu lar, this b u d g e t sets a c rite rio n f o r e v a lu a tin g the s h o r t- r a n g e d e c is io n to p r o m o te the statio n th r o u g h the a rc h iv in g o f d ri v e -ti m e p r o g r a m m i n g . If the a rc h iv in g g e n e ra t e s a d d it io n a l r e v e n u e s o f at least $ 1 0 , 0 0 0 an d a d v e rtis in g sa les are i n c r e a s e d as p ro je c te d , K H I T m i g h t c o n ti n u e th e p r a c ­ tice p a st the ne xt year. If th e o u tlin e d e x p e c t a tio n s w e re not m et, the ra d io station w o u ld p r o b a b l y d r o p the stra te g y fo r th e n e x t year. T h e e x a m p l e o f ra d io statio n K H I T illu stra tes h o w a n n u a l b u d g e ts arc d e v e l ­ o p e d an d u se d fo r s h o r t- r a n g e p la n n in g a n d ro u tin e d e c is io n m a k i n g . L o n g - r a n g e b u d g e ts are u sed f o r p la n s o f 5 y e a rs o r m o r e a n d c o v e r m o r e n o n r o u t in e d e c i ­ sio ns. W h e t h e r a m a n a g e r m a k e s a fairly ro u tin e , s h o r t-r a n g e d e c is io n or a n o n ­ r o u tin e , lo n g - r a n g e d ec is io n is often a fu n c tio n o f th e m a n a g e r ’s level in the o rg a n i z a ti o n . T h e ty p es o f b u d g e t in f o rm a t io n a m a n a g e r n e e d s an d u ses for d e c is io n m a k i n g are a f f e c te d by the lo n g - o r sh o r t-te rm n a tu r e o f th e d ecis io n . T h e s te p s in the d e c is io n - m a k in g p r o c e s s a re r e v i e w e d to e x p la in h o w m a n ­ a g e rs use b u d g e ts . T w o im p o r t a n t a s p e c ts o f the p ro c e s s also are d is c u s s e d : h ow s h o rt- v e rs u s l o n g - ra n g e d e c is io n s affec t the use o f in f o rm a t io n a n d h o w the d i f ­ fe r e n c e s in o r g a n i z a ti o n a l lev els a ffe ct m a n a g e r ia l d e c is io n m a k in g .

MA N A G E R IA L D E C IS IO N M A K IN G M a n a g e r ia l d e c is io n m a k i n g , like m o s t d e c is io n m a k i n g , c o n s is ts o f six stage s, as s h o w n by the d e c is io n - m a k in g w h e e l in c h a p te r 1 (this v o lu m e ). C o lle c tin g an d a n a ly z in g in f o rm a t io n p la y s the c e n tra l ro le in this p ro c e s s , b ut m a n a g e r s at d if fe re n t o rg a n i z a ti o n a l levels c o lle c t a n d use in f o r m a t io n d iffe re n tly . T h e c a se o f K H I T illustrates this p ro c e s s. T h e sales m a n a g e r ide n tifie d the p o s s ib le in c r e a s e s in a d v e rtis in g r e v e n u e th r o u g h d is c u s s i o n s w ith sales p e r s o n ­ nel an d a d v e rtis e rs , an d by e v a lu a tin g lo c a l and n a tio n a l e c o n o m i c in d ic a to rs. T h e sales m a n a g e r v ie w e d the o p p o r t u n it y fro m the p e rs p e c ti v e o f h o w it w o u ld aff e c t the d e p a r t m e n t d u ri n g the c o m i n g year. T h e g e n e r a l m a n a g e r , in c o n tra st, sp ecifie d the o v e ra ll o r g a n i z a ti o n a l g o a l o f in c r e a s in g profits in c o m p a r is o n w ith las t year. T h e sales m a n a g e r in f o r m e d the g e n e r a l m a n a g e r o f the o p p o r t u n it y to im p r o v e sales p e r f o r m a n c e th r o u g h train in g a n d m e n t o r i n g the sales staff. T h e g e n e ra l, sales, an d p r o g r a m m a n a g e r s r e v i e w e d s e v e r a l s trate g ies an d sele c te d the a rc h iv in g strateg y b e c a u s e it a p p e a r e d to be a re la tiv e ly c o s t-e ff e c tiv e w a y to in c r e a s e profits. Y et all m a n a g e r s w e r e in v o l v e d to e n s u r e that the o rg a n i z a ti o n a l an d d e p a r t m e n t a l p e rs p e c ti v e s w e re c o n s i d e re d . T h is e x a m p l e also d e m o n s tr a t e s h o w the b u d g e t is u sed for im p le m e n ti n g the so lu tio n . T h e in c o m e s t a te m e n t is u se d to m o n i t o r th e so lu tio n b e c a u s e it p r o ­ v id e s in f o rm a t io n a b o u t the p e r f o r m a n c e o f the so lu tio n . B oth ca n b e r e v i e w e d to refine the s o lu tio n in fu tu re y ea rs . All th ree m a n a g e r s u n d e rs ta n d th at if profits are n o t in c r e a s e d in th e n e x t y e a r or tw o , all m a y lo se th e ir jo b s .

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Long- Versus Short-Range Decisions S h o rt-ra n g e d e c is io n s a re o ften r o u tin e d e c is io n s — the ty p e th at a m a n a g e r h as s o m e d e g re e o f e x p e ri e n c e in m a k in g on a r e g u la r basis. B e c a u se o f the m a n ­ a g e r ’s e x p e rie n c e w ith a rou tin e d e c is io n , in f o rm a tio n a b o u t alte rn ativ e strateg ies, an d the results o f th o se strate gie s is a c c u m u la te d . A s a result, ro u tin e d e c is io n s u su a lly in v o lv e less risk, an d the d e c is io n o u tc o m e s are m o r e p re d ic ta b le th an in n o n ro u tin e d ec isio n s. R o u ti n e d e c is io n s are e v a lu a te d w ith in s o m e sh o r t p e ri o d o f tim e, p e r h a p s a few m o n th s . S o if sh o r t-r a n g e d e c is io n s h a v e u n e x p e c t e d n e g a tiv e c o n s e q u e n c e s o r d o no t p r o d u c e the e x p e c t e d resu lts, c h a n g e s ca n be m a d e q u ic k l y to m i n im iz e the i m p a c t o f the u n d c s i rc d o u tc o m e s . N o n r o u ti n e d e c is io n s are m a d e in f re q u e n t ly an d h a v e lo n g - r a n g e effe c ts and c o n s e q u e n c e s . S u c h c o n s e q u e n c e s are d ifficu lt to a n tic ip a te . F o r e x a m p l e , the d ec is io n to in v e s t r e s o u rc e s in ne w e q u ip m e n t, such as a n e w sy s te m o f c o m p u t ­ ers fo r a n e w s p a p e r , h a s the s h o r t-r a n g e c o n s e q u e n c e o f in c r e a s in g c o sts d u rin g the fiscal y e a r o f the p u rc h a s e . H o w e v e r , the l o n g - ra n g e c o n s e q u e n c e s m a y be m o r e d ifficu lt to d e t e r m i n e a n d fo recast. F o r e x a m p l e , d e s i re d l o n g - ra n g e o u t ­ c o m e s w o u ld in c r e a s e w rite r p ro d u c tiv ity an d e ff icien cy in th e p ro d u c t io n o f the p ap e r. Y e t an u n a n ti c ip a t e d , lo n g - r a n g e c o n s e q u e n c e o f u sin g v id e o d is p la y te r ­ m in a ls w a s re p e titiv e m o t io n in jury, w h ic h c o u ld h a v e be en a v o id e d by p u r c h a s ­ ing e r g o n o m i c fu rn itu re a n d m a te ria ls. H e n c e , b a c k g r o u n d r e s e a rc h is n e e d e d to e v a lu a te the lik e lih o o d o f th o s e o u t c o m e s an d p re d ic t the v a lu e a d d e d to the p a p e r in the lo ng run. M a n a g e r s s h o u ld also e v a lu a te p ro b l e m s to se e w h e t h e r an u n e x p e c t e d and m o r e c o s t-e ff e c tiv e s o lu tio n m a y b e fo u n d . F o r e x a m p l e , n e w s p a p e r s are finding w a y s to r e d u c e th e c o s t o f s e r v in g a d v e rtise rs. T h e s e in c lu d e c h e a p e r and fas ter w a y s to m a k e c o lo r p ro o fs and the use o f e le c tio n te a r s h e e t s to s h o w th a t ad s h a v e run. S o m e n e w s p a p e r s h a v e p u r c h a s e d h ig h - e n d c o lo r c o p ie s fo r m a k i n g p a g e an d ad p ro o fs. S u c h c o p ie r s c o st $ 5 0 , 0 0 0 o r m o r e , b u t ca n p rin t a p r o o f in 3 to 4 m i n u te s fo r $ 0 .3 7 , r a t h e r th an 20 to 30 m i n u te s fo r $7 ( T o n e r, 1997). N e w s p a p e r s can also se n d e -m a il s w ith h y p e r l in k s to th e ir a d v e rtis e rs , a n d the h y p e rl in k a llo w s the a d v e rt is e r to see and p rin t the ad ( G o o d m a n , 2 0 0 2 ). N e w s ­ p a p e r m a n a g e r s ca n k e e p up w ith s u c h in n o v a t io n s b y re v i e w i n g P r e s s tim e eac h m o n th . M a n a g e r s in o th e r m e d ia firm s c an c h e c k th e ir trad e p u b li c a ti o n s each m o n th fo r s i m i la r c o s t -s a v i n g ideas. U n e x p e c te d , lo n g - ru n n e g a tiv e resu lts o f d e c is io n s are ev e n m o r e d ifficult to p re d i c t than e x p e c t e d p o sitiv e lo n g - r a n g e o u tc o m e s . A c o n t e m p o r a r y c o n c e rn is w h e t h e r the I n te rn e t will d ra w r e a d e r s a w a y fro m n e w s p a p e r s . M a n y p a p e r s p u b ­ lish o n lin e e d itio n s to retain r e a d e r s an d p r e v e n t e ro s io n o f classified a d v e rtisin g . Y e t p u b li s h i n g o n lin e m a y d i s c o u r a g e s o m e p o te n tia l su b s c rib e r s fro m b u y in g a s u b s c rip tio n . N e w s p a p e r m a n a g e r s m u s t k e e p a b re a s t o f tre n d s to e n s u r e that r e a d e r s and r e v e n u e s are n ot lost to th e Internet.

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T h e fact that fu tu re o u t c o m e s m u s t be p re d ic te d m a k e s l o n g - ra n g e d e c is io n m a k i n g m o r e difficu lt than s h o r t-r a n g e d e c is io n m a k i n g . L o n g - r a n g e d e c is io n s o fte n in v o l v e s o m e larg e in v e s tm e n t o f c a p ita l and i n v e n t o ry , m a k i n g the d e c i ­ sion e v e n riskier. B e c a u s e n e w s p r i n t e x p e n s e s a lo n e re p r e s e n t 15% to 2 0 % o f a n e w s p a p e r ’s a d v e rtisin g b u d g e t (R u d d e r , 1997), n e w s p a p e r s try to b u y extra n e w s p r i n t w h e n p rices are d o w n and less n e w s p ri n t w h e n p rices are h ig h . T h is affects th e ir n e w s p ri n t in v e n to ry . A c o m p a n y th a t can a c c u ra te ly p r e d i c t v a r i a ­ tion s in n e w s p r i n t p ric e s w ill in c r e a se profits. T h o s e th a t m i s c a l c u la t e w ill pay m o r e fo r n e w s p r i n t a n d r e d u c e profits. L o n g - r a n g e d e c is io n s m o s t often o c c u r at h i g h e r le v e ls in o rg a n i z a ti o n s , and s h o r te r r a n g e d e c is io n s o c c u r at m i d d le an d l o w e r le vels. H i g h e r le v e l m a n a g e ­ m e n t p e rs o n n e l m a k e the risk ie r d e c is io n s an d ta ke r e s p o n s ib ility fo r d e c is io n s tha t a ffe ct the e n tire o rg a n i z a ti o n . M i d d le a n d l o w e r lev el m a n a g e m e n t m a k e d e ­ cis io n s th at are m o r e ro u tin e , less risk y , an d re s u lt in c o n s e q u e n c e s th a t directly influ en ce th e ir d e p a r t m e n t s . T h e lev el o f d e c is io n m a k i n g a n d the n a tu r e o f the d e c is io n a ffec t the ty p e o f in f o rm a t io n the m a n a g e r n e e d s for the d e c i s i o n ­ m a k i n g p ro c e s s . In d e e d , the t y p e o f b u d g e t in f o rm a t io n m a n a g e r s u se and e v a l u ­ ate v aries b a s e d on th e s e s a m e factors.

Levels of Planning, Decision M a k in g , and In fo rm a tio n Needs T h e n a tu r e o f p la n n i n g and d e c is io n m a k i n g v aries w ith th e o rg a n i z a ti o n level at w h ic h e a c h p ro c e s s o c c u rs . A t the h ig h e s t le v e ls o f m a n a g e m e n t , d e c is io n s are m a d e d e te r m i n in g th e f i r m ’s p o lic ie s an d g e n e ra l g u id e l in e s fo r e v a lu a tin g th e c o m p a n y ’s p e r f o r m a n c e . T h is is w h a t the o w n e r s o f C a lla s C o m m u n i ­ c a tio n s d o. T h e in f o r m a t io n that top m a n a g e m e n t u ses is o fte n s u m m a r i z e d and fu tu re o rie n te d . F o r e x a m p l e , in f o rm a t io n a b o u t fu tu re m a r k e t sh are, e c o ­ n o m i c in d ic a to rs, an d o th e r m a r k e t p e r f o r m a n c e m e a s u r e s are f o r e c a s te d and u sed by u p p e r lev el m a n a g e m e n t to p re d i c t r e v e n u e a n d pro fit g o a ls fo r the c o m i n g year. M i d d le - l e v e l m a n a g e m e n t ty p ic a lly d e a ls w ith u sin g r e s o u rc e s efficie n tly and eff e c tiv e ly . A t this lev el, m a n a g e r s n e e d in f o rm a tio n to d e v e lo p o p e ra t in g b u d ­ gets. O ften d e c is io n s n e e d to b e m a d e a b o u t in v e s tin g in n e w e q u i p m e n t , s e r ­ v ices, o r p eo p le . F o r e x a m p l e , a n e w s p a p e r ’s m a n a g i n g e d it o r m i g h t d e c id e to b u y a n e w a d v ic e c o lu m n a b o u t the In te rn e t if r e a d e r s in d ic a te an in te re s t in this se rv ic e an d in f o rm a tio n . L o w e r lev el m a n a g e m e n t d e a ls w ith m o r e stru c tu r e d , r o u tin e task s a n d uses in f o rm a t io n fro m in s id e the o rg a n iz a tio n . D e c is io n rule s are c o m m u n i c a t e d , p re f e ra b ly in v e rb a l and w ritte n fo rm . T h e in f o r m a t io n u se d is d e ta ile d an d ty p i ­ cally u n a m b i g u o u s . A t this m a n a g e r ia l level, in f o r m a t io n is not n e c e s s a rily fo r e ­ ca sted fo r fu tu re c o n c e rn s . F o r e x a m p l e , K H I T ’s p r o g r a m m i n g d ir e c to r m u s t d e c id e w h e n D Js w ill ta ke v a c a tio n s.

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D E V E LO P IN G THE MASTER B U D G E T PLAN A N D D EP A RTM E NTA L BUDGETS D e v e lo p in g b u d g e ts is o n e part o f the p la n n i n g p ro c e s s w h e r e d e c is io n s are m a d e a b o u t the av ailable reso u rce s for ach ie v in g goals. G en era tin g the m a s te r b ud g et plan for the entire bu siness can take s o m e tim e — usually 3 to 6 m o n th s — d e p e n d in g on the size, n a tu re , a n d c o m p l e x i t y o f the o rg a n i z a ti o n . M a n a g e r s at all levels o f th e o rg a n i z a ti o n p a rtic ip a te in th e e ffe c tiv e d e v e l o p m e n t o f the m a s te r b u d g e t p lan. A t the h ig h e s t level, a b u d g e t c o m m i t t e e m i g h t c o n s i s t o f the c o m p a n y p r e s id e n t, co n tr o lle r, vice p re s id e n t o f sale s, a n d v ic e p r e s id e n t in c h a rg e o f p r o ­ d u c tio n . In a m e d i a o rg a n i z a ti o n , the b u d g e t c o m m it te e i n c l u d e s the top m a n ­ ag er, c o n tr o lle r, an d all d e p a r t m e n t h e a d s. T h is c o m m i t t e e e s t a b li s h e s b u d g e t g o a ls fo r th e c o m p a n y th a t d ire c tly affect the b u d g e ti n g at the d e p a r t m e n t a l level. T h e b u d g e t c o m m i t t e e also r e v i e w s an d a p p r o v e s d e p a r t m e n t a l b u d g e ts . A b u d g e t d ir e c to r re p o rts d ire c tly to the c o n tr o ll e r an d c o o r d i n a te s b u d g e ts at the d e p a r t m e n t a l level. T h e b u d g e t d ir e c to r p r e p a r e s a tim e ta b le fo r the d e v e l o p ­ m e n t a n d a p p r o v a l o f all o p e ra tin g b u d g e ts an d w o r k s w ith m a n a g e r s in th e d e ­ v e l o p m e n t o f each d e p a r t m e n t a l b u d g e t. T h e m a s te r b u d g e t plan is a s s e m b le d an d s u b m it te d to the b u d g e t c o m m i t t e e an d then the b o a rd o f d ire c to rs fo r a p ­ p ro v a l. F in ally , the b u d g e t d ir e c to r is re s p o n s ib l e for p re p a r in g an d d is trib u tin g p e r f o r m a n c e re p o rts b a s e d on the p r e v i o u s y e a r ’s b u d g e t to the b u d g e t c o m m i t ­ tee an d d e p a r t m e n t m a n a g e rs .

Forecasting A k e y e l e m e n t o f g e n e ra t in g b u d g e ts is fo r e c a stin g . F o re c a s tin g is an e ff o rt to p re d i c t fu ture e v e n ts and tre n d s an d an tic ip a te th e ir im p li c a ti o n s fo r the c o m ­ p a n y . G r a n g e r ( 1 9 8 0 ) listed three ty pes: e v e n t- o u tc o m e fo re c a sts , e v e n t- ti m i n g fo reca sts , an d ti m e - s e ri e s fo reca sts . W it h e v e n t - o u t c o m e fo r e c a sts , a m a n a g e r tries to p r e d i c t the c o n s e q u e n c e s o f an e v e n t. F o r e x a m p l e , h o w will th e c lo s in g o f the re g io n a l re c o r d in g s tu d io in to w n a ff e c t K H I T - F M ? W it h e v e n t- ti m i n g fo re c a sts , a m a n a g e r a tt e m p t s to p re d ic t w h e n a specific e v e n t w ill tak e place. F o r e x a m p l e , if a g r o w in g city h as o nly on e n e tw o rk - a ffilia te d T V sta tion , th at s t a ti o n ’s m a n a g e m e n t w o u ld b e in te re ste d in k n o w in g w h e n a s e c o n d n e tw o rk affiliate m i g h t e n te r the m a rk e t. W ith tim e - s e rie s fo r e c a s tin g , a m a n a g e r a tte m p ts to p r e d i c t the e ffe c ts o f a series o f p h e n o m e n a on the b u s in e s s . F o r e x a m p l e , w h a t effe c ts w ill the listing o f e m p l o y m e n t n o tic e s on the In te rn e t b y in d iv id u a l c o m p a n i e s h a v e on a n e w s p a p e r ’s classified ad lin a g e ? T h e b e n e fits o f a c c u ra t e fo r e c a s tin g se em o b v io u s g iv en the c e n tra l ro le o f in ­ f o r m a ti o n in d e c is io n m a k i n g . H o w e v e r , a c c u ra te fo r e c a s tin g is n o t e a s y . So m a n y fa c to rs ca n c h a n g e , an d the p o ss ib ility o f m e a s u r e m e n t e rr o rs is so great, th a t a c c u ra t e l o n g - ra n g e fo r e c a stin g is as m u c h an art as a science.

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CHAP T E R 10

D esp ite the lim itatio ns, h o w e v e r, b u d g e tin g requ ire s s o m e forec asting . K re itn e r (1 9 8 6 ) listed three ty p e s o f fo recastin g : in f o rm e d j u d g m e n t , su rv e y s, an d trend a n aly sis. I n f o r m e d j u d g m e n t in v o lv e s the fo re castin g o f e v e n ts and tren d s by an in d iv id u a l o r g ro u p b a s e d on k n o w le d g e o f the topic b e in g forecast. In f o rm e d j u d g m e n t is u se d e x te n s iv e ly in the c rea tio n o f m o s t sh o rt-te rm bu d g ets . S u rv e y s are e fforts to a n tic ip a te the future b y a skin g q u e s tio n s o f a sa m p le o f p e o p le w h o re p r e se n t a larg er g ro u p . T h e id ea is to d raw c o n c lu s io n s a b o u t the future o f the larg er g ro u p b a s e d on c o m m e n t s fro m a sm all p e rc e n ta g e o f tha t g rou p. T r e n d a n a ly s is e x te n d s h is to ric al tr e n d s f o u n d in d a ta a b o u t the p a s t into the f u tu re, w ith s o m e alte ra tio n s b a s e d on a s s u m p ti o n s o f c h a n g e . B e c a u s e e v e r y ­ thing c h a n g e s to a d e g re e , all tren d a n a ly s is m u s t a d d re s s k e y fa c to rs th a t sh ape the e v e n t b e in g fo re c a st. F o r e x a m p l e , if K H I T ’s a d v e rtis in g s ta ff is e x te n d i n g tren d s in a d v e rt is i n g sales, the s ta ff n e e d s to sp e c ify a s s u m p ti o n s a b o u t c h a n g e s in o verall b u s i n e s s sales. T h e s t a ff m i g h t a s s u m e , b a s e d on p r e d ic tio n s b y g o v ­ e r n m e n t e c o n o m i s t s , that retail sale s in th e ir m a r k e t w o u ld in c r e a s e 5% d u ri n g the n e x t year. U sin g this figure, the s t a ff c o u ld c o m e up w ith an e stim a te o f retail sales. F ro m this figure, th ey c o u ld e s t im a te their r e v e n u e d u ri n g the n e x t y e a r by a p p ly i n g the p e r c e n t a g e o f local retail sales th at th ey h a v e r e c e i v e d as a d v e r t is ­ ing r e v e n u e d u ri n g th e p a st 5 y ears. K H I T ’s s ta ff m i g h t also u se the trade p re s s an d I n te rn e t re s o u r c e s to re v ie w e c o n o m i c in d ic a to r s. F o r e x a m p l e , A d v e r ti s i n g A g e , B r o a d c a s t in g , P r e s s t i m e , and o th e r trad e p u b li c a ti o n s ty p ic a lly carry articles a b o u t a c tu a l and p ro je c te d ad v e rtis in g e x p e n d it u r e s . E c o n o m i c in f o rm a tio n m a y be f o u n d at the C e n s u s B u ­ r e a u ’s h o m e p a g e (h t t p : / / w w w . c e n s u s . g o v / e c o n / w w w / i n d e x . h t m l ). A ll b u d g e ti n g r e q u ire s s o m e fo r e c a s tin g . It is im p o r t a n t to d e a l ex p lic itly w ith a s s u m p ti o n s a b o u t the c h a n g in g e c o n o m i c e n v ir o n m e n t . O th e r w is e a s tatio n will u n d e r e s tim a te r e v e n u e s in a b o o m i n g e c o n o m y an d o v e r e s tim a te re v e n u e s in an e c o n o m i c d o w n tu r n . T w o p rin c ip le s te n d to h o ld true: T h e l o n g e r the tim e r a n g e a b u d g e t c o v e rs , the m o r e im p o r t a n t fo r e c a s tin g b e c o m e s , an d the l o n g e r the ran g e a b u d g e t c o v e rs , the h a r d e r it is to f o r e c a s t a c c u ra te ly . T h is, in e ffec t, is the fo r e c a stin g d il e m m a . T h e o n ly so lu tio n is to in v e s t in s e v e r a l fo r e c a s tin g m e t h ­ o d s fo r the lo n g r a n g e a n d hire c o m p e t e n t fo re casters.

D e p a r tm e n ta l O p e ra tin g Budgets A lth o u g h f o r e c a s ti n g p la y s a role in the a n n u a l d e p a r t m e n t a l b u d g e t, the n e e d for e x te n s iv e fo r e c a stin g is m i n im iz e d by th e d a ta fro m p r e v i o u s y e a r s ’ i n c o m e s t a te m e n ts and b u d g e ts a n d fro m the e x p e rt is e o f th e p e o p le w ith in the d e p a r t ­ m e n ts. In f o r m e d j u d g m e n t p la y s a k e y role, a lt h o u g h this s h o u ld be b o ls te re d by a v a ila b le d a ta in the m a r k e tp la c e . T h e d e p a r t m e n t b u d g e t is th e c e n tr a l d o c u m e n t fo r c o n tr o llin g th e fin anc es o f an o rg a n i z a ti o n , an d it p lay s a d ir e c t or an in d ire c t role in m o s t d e c is io n s.

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TABLE 10.4 O perating Budget and Income Statement for the News/Editorial D e partm ent of an 80,000 Circulation Daily Newspaper Item

This Year ($)

L a st Year ($)

3 .500,000

3 ,395,000

Payroll S alaries O vertim e

4 0 ,000

4 0 .000

C o r re sp o n d e n ts and freelancers

80,000

7 5 ,000

60,000

4 5 ,000

120,000

100,000

O f fi c e s u p p l i e s R esearch m aterials C o m p u te r tim e B ooks, m agazines, n ew spapers Travel P h otography

1 ,0 00

5,000

4 0 ,000

50,000

4 0 ,000

38,000

N e w s services

164,000

160,000

S y n d icated m aterial

124,000

1 2 0 ,0 0 0

O th er new s/editorial

75,000

7 5 ,000

4,2 4 4 ,0 0 0

4,1 0 3 ,0 0 0

T o ta l

T a b le 10.4 s h o w s the n e w s r o o m b u d g e t fo r a daily n e w s p a p e r w ith a c irc u la tio n o f 8 0 ,0 0 0 . T h e d e p a r t m e n t a l o p e ra t in g b u d g e t is set u p on an a n n u a l b asis, w ith at least m o n t h ly u p d a te s on past s p e n d i n g an d r e s o u rc e s th a t r e m a in a v a ila b le . All b u d g e ts are b ro k e n d o w n into c a te g o rie s o f e x p e n s e s c o n s i d e re d to be i m ­ p o rt a n t in ru n n i n g the b u s in e s s . W h i c h e x p e n s e c a te g o rie s are i m p o r t a n t v aries fro m m e d i u m to m e d i u m and fr o m c o m p a n y to c o m p a n y . A t the n e w s p a p e r r e p ­ re s e n te d in T a b le 10.4, p a y ro ll is d iv id e d into sa la rie s fo r f u ll-tim e e m p l o y e e s , o v e rtim e paid to fu ll-tim e e m p lo y e e s , an d m o n e y used to p ay p art-tim e e m p lo y e e s called c o r r e s p o n d e n ts and fr e e la n c e r s . A larger n e w s p a p e r m ig h t list p h o to g r a p h y salaries sepa rate ly from th ose o f w riters an d editors. It m ig h t also differe ntia te b e ­ t w e e n r e g u l a r p a rt-tim e e m p l o y e e s (c o r r e s p o n d e n t s ) a n d ir re g u la r p a rt-tim e e m ­ p lo y e e s (fre e la n c e rs). T h e i m p o r t a n t c o n s i d e r a t io n is th at b u d g e t c a te g o rie s an d s u b c a t e g o r i c s re v e a l h o w the m o n e y is b e in g s p e n t w ith in the d e p a r t m e n t in a w a y th a t a ll o w s fo r d e c is io n m a k in g . T h e a m o u n t o f m o n e y a llo c a te d to a b u d g e t c a te g o ry reflects its relativ e i m ­ p o r t a n c e in r e a c h i n g the d e p a r t m e n t ’s go als. F o r in s ta n c e , m a n a g e m e n t at the n e w s p a p e r re p r e s e n te d in T a b le 10.4 d e c id e d to s p e n d m o r e on an o n lin e r e ­ s e arc h d a ta b a s e se rv ic e this y ear. T h e c o s t o f this o n lin e d a ta b a s e is s h a r e d with o t h e r d e p a r t m e n t s at the n e w s p a p e r. R e s o u r c e s w e re c u t for b o o k s , m a g a z in e s , and n e w s p a p e r s b e c a u s e s o m e o f th ese m a te ria ls w ill n o w b e a v a il a b le th r o u g h the o n lin e d a ta b a s e . E x p e n d it u r e s for trav el w e re also c u t to help p ay for the d a ta b a s e . T h e c o r r e s p o n d e n ts and fr e e la n c e rs e x p e n d it u r e w a s in c r e a s e d so the p a p e r can hire s o m e o n e to train e m p l o y e e s to u se the o n lin e d a ta b a s e an d hire t e m p o r a r y h e lp w h e n big storie s b rea k.

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T he im p o rta n ce o f b u d g et item s can ch an g e across time to reflect the o rg a n i­ z a tio n ’s long-term plans. T h e c o m m it m e n t to using the online d atab a se is seen in increased p ayroll and office supply e xp end itu res. T he p a p e r ’s m a n a g e m e n t plans to rew ard em p lo y e e s w h o use the d atab a se effectively, an d additional office su p ­ ply p u rch ases o f p a p e r and an add ition al printer are in the budget. H o w e v e r, a plan that w o uld in crease profit by c ontrolling costs w ou ld reveal payroll re d u c ­ tions or keep them stable as rev enu es increase. T h e o perating b u d g e t can be th o u g h t o f as an ideal for the y e a r ’s spending. Y et w ith n ew s m edia, the ideal rarely h ap p e n s. This is w h y m a n a g e rs often end up shifting m o n e y from o ne categ ory to an o th e r and m ay ev en get additional reso urces from the top m a n a g e m e n t o f the m e d ia organ ization . W h e n w orldcha n g in g ev ents such as th ose on S e p te m b e r 1 1, 2001, hap p en , new s o rg a n iz a ­ tions will ignore the o peratin g budget. M o n e y will have to be shifted and new reso urces found. Often rev en u e will be fo rgo ne as n e w sp a p e rs run m o re pages and T V n e w s go es to 2 4 -h o u r co v erag e. A b u d g e t is a m ap , but detours are e x ­ pecte d. A quality n ew s operation will often require d eviatio ns from the b u d g e t to acc om p lish im p ortan t c o m p a n y goals.

Budgeting Methods T h e d ep a rtm e n t h ead s are usually in ch arg e o f g e neratin g th eir d ep a rtm e n t o p e r­ ating budgets. T h e y are m ost fam iliar with their d e p a r t m e n t’s needs. Y et they are not as fam iliar with the business e n v ir o n m e n t as the e m p lo y e e s w h o m aintain co n tac t with th ose o utside the organ izatio n. T he reporters, c a m e ra crew s, sales­ people, and recep tion ists are the on es w h o deal w ith n e w s sou rces, readers, lis­ teners, view ers, and advertisers. F o r this reason , the d e p a rtm e n t h e a d s ’ in fo rm ed ju d g m e n t m u s t reflect their w o r k e r s ’ exp erien ce. B ud getin g m eth o d s in vo lve tw o con siderations: flow o f inform ation and as­ su m ed starting point o f the bu dg et. T h e flow o f inform atio n can be u pw a rd , d o w n w a rd , or both. U p w a rd flow m ean s the in fo rm atio n goes from e m p lo y e e s to the m an a g e rs. D o w n w a r d flow is the reverse, and both m ean s a tw o -w ay flow occurs. In the d ep artm ental b u d g etin g p ro cess, inform atio n m u s t flow both w ay s to generate an effective budget. M a n a g e r s need inform ation from e m p lo y e e s to u n ­ d erstand w h at th ey need to do their j o b s effectively. A t the sa m e tim e, w o rk e rs need to u n d erstand the b ud ge ta ry con straints that face their org an iza tion so they d o not sq u a n d e r resources. A lth o u g h this flow o f in form atio n is greatest during the b ud g e tin g period, it should co ntinu e all y ear long. The b u d g e t is a starting point. A ctua l e x pe nd itures m ust be c o m p a re d to the b u d g et th ro u g h o u t the year. E m p lo y e e s need to know how e x p en d itu res c o m p a r e to the b u d g e t pro cess th ro u g h o u t the year. T his is especially true o f jo u rn alists. A jou rnalist w ho u n derstand s the bu dg et and can

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a rg u e fo r a big story w ith in its c o n s tra in ts is m o r e likely to h a v e m a n a g e m e n t ’s s u p p o r t th a n o n e w h o d o e s n ot u n d e r s ta n d w h a t a p a rtic u la r sto ry r e q u e s t m e a n s to the d e p a r t m e n t ’s b u d g e t. T h e s e c o n d c o n s i d e ra t io n is the a s s u m e d sta rtin g p o in t o f the b u d g e t. T y p i ­ c ally , it is a s s u m e d th at last y e a r ’s o p e ra t in g b u d g e t reflects the n e e d s o f the d e p a r t m e n t . T h e p re v i o u s y e a r ’s f u n d in g le v e ls b e c o m e the sta rtin g p o in t for this y e a r ’s b u d g e t. T h is a p p r o a c h is s im ila r to tren d a n a ly s is b e c a u s e it a s s u m e s the tren d r e p r e s e n ts w h a t is n e e d e d . T h e s h o r tc o m i n g is th a t it p e r p e t u a te s any m is c a l c u la t io n s o r erro rs fro m p re v i o u s b u d g e ts . A n a lte rn a tiv e startin g p o in t is c a lle d z e r o - b a s e d b u d g e t i n g , w h ic h a s s u m e s th a t e v e r y b u d g e t starts at zero an d m a n a g e r s m u s t ju s tify all e x p e n d it u re s . It is e a s ie r to id e n tify in e ffic ie n c ie s o r w a s te f u ln e s s u sin g this m e t h o d . H o w e v e r , the p r o c e s s is far m o r e t i m e - c o n s u m i n g th an b a s i n g e x p e n d it u r e s on last y e a r ’s o p e r ­ atin g b ud g et. A n e x a m p l e o f h o w the tw o m i g h t c o m e into pla y can be f o u n d in T a b le 10.4. S u p p o s e the e d it o r finds in the i n c o m e s t a te m e n t th at o n ly $ 7 3 , 0 0 0 w a s s p e n t last y e a r o n c o r r e s p o n d e n ts an d fr e e la n c e rs , w h ic h w a s $ 2 , 0 0 0 less th a n b u d g e te d . T h e ne w b u d g e t c o u ld start w ith the $ 7 5 , 0 0 0 in last y e a r ’s b u d g e t, a lt h o u g h that a m o u n t is n o t n e e d e d b a s e d on last y e a r ’s p e r f o r m a n c e . A n a d d it io n a l $ 5 ,0 0 0 is a d d e d b e c a u s e o f in flation an d the e x p e c t a tio n tha t th e local u n iv e r sity b a sk e tb a ll tea m w ill g o to the N C A A to u r n a m e n t . U s in g this m e t h o d , the r e q u e s t for $ 8 0 , 0 0 0 is p r o b a b l y m o r e than w h a t w ill be used. If z e ro - b a s e d b u d g e tin g is u se d , the ed ito r has to ju s tify the $ 8 0 ,0 0 0 , w h ic h w o u ld be hard to d o b ased on last y e a r ’s p e rf o rm a n c e . M o s t likely, the a m o u n t n ee d e d fo r c o rr e s p o n d e n ts w o u ld be the s a m e as the p re v io u s y e a r ($ 7 3 ,0 0 0 ) , plus the $ 5 ,0 0 0 figure, w h ic h w o u ld e q u a l $ 7 8 ,0 0 0 . H o w e v e r , the e d ito r m i g h t h av e to shift m o n e y from o th e r p la c e s if u n e x p e c te d e v e n ts r e q u ire m o r e fr e elan ce h ou rs. D e s p ite the s e e m in g a p p e a l o f z e r o - b a s e d b u d g e ti n g to th e o v e ra l l o r g a n i z a ­ tion, it is n o t a c o m m o n l y u sed p ro c e s s in m e d i a o rg a n i z a ti o n s . First, the in ­ cre a s e d d e m a n d on tim e is a p ro b le m f o r m a n y m a n a g e r s w h o a lr e a d y h a v e too m a n y re s p o n s ib ilitie s o r w h o do n o t e n jo y d e a li n g w ith n u m b e r s . T h is latter p ro b l e m is e s p e c i a ll y true in n e w s r o o m s w h e re m a n y p e o p le c o n s i d e r t h e m ­ se lv e s to b e w o r d an d n o t n u m b e r p e o p le . S e c o n d , this a p p r o a c h ta k e s p o w e r a w a y fro m d e p a r t m e n t a l m a n a g e rs . M o n e y is p o w e r, an d d e p a r t m e n t s ca n b e ­ c o m e a d v e rs a ria l r a t h e r th an c o o p e r a t iv e as th ey c o m p e t e fo r b u d g e ts . M a n y o f th o s e w h o h a v e p o w e r d o n o t like to risk g iv in g it up, w h ic h is w h a t z e ro - b a s e d b u d g e ti n g can d o. In e ffe ct, in d iv id u a l m a n a g e r s ’ g o a ls can interfe re w ith w h a t is b e s t fo r the o rg a n i z a ti o n . S o m e c o m p r o m i s e b e tw e e n the tw o a s s u m p tio n s is best. Justifyin g b u d g e t it em s is an im p o rta n t p ro cess in id entify ing areas th at no lo n g e r need as m a n y r e ­ sou rces; this a llo w s the shifting o f re s o u rc e s to n ew areas. A s s h o w n in T a b le 10.4, re s o u rc e s c o u ld be s h ifte d fro m b o o k s , m a g a z in e s , and p a p e r s to c o m p u t e r tim e on the o n lin e d a ta b a s e . H o w e v e r , the tim e re q u i r e m e n ts to ju s tify all b u d g e t

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item s w o u ld o v e r b u r d e n m a n y s m a ll e r o rg a n i z a ti o n s . If the b u d g e t d ir e c to r a c tiv e ly id entifies a re a s th a t are w a n in g in im p o r t a n c e w ith in d e p a r t m e n t s , the d e p a r t m e n t h e a d s ca n de al w ith th e s e c a te g o rie s w ith o u t h a v in g to to ta lly ju s tify all b u d g e t item s.

SUMMARY A c c o u n t i n g p ra c tic e s fall into tw o c a te g o rie s : fin a n c ial an d m a n a g e ria l . F in a n c i a l a c c o u n t in g is u se d p rim a rily b y th o se o u ts id e the o rg a n i z a ti o n an d is ty p ified by the b a la n c e sh eet. T h e b a la n c e s h e e t is a p ic tu re o f the ass ets an d liab ilitie s o f an o rg a n i z a ti o n at a g iv e n p o in t in tim e. It s u m m a r i z e s the o r g a n i z a t i o n ’s financial w e ll- b e in g . M a n a g e r ia l a c c o u n t in g is a im e d at g e n e r a t in g in f o rm a t io n fo r d e c is io n s . T h e m o s t im p o r t a n t fo r m s o f m a n a g e r ia l a c c o u n t in g are b u d g e ts an d i n c o m e s t a te ­ m e n ts . A b u d g e t is the pla n fo r h o w the o rg a n i z a ti o n w ill s p e n d m o n e y d u ri n g a g iv e n tim e p e rio d . T h e in c o m e s ta te m e n t is a s u m m a r y o f h o w m o n e y w a s sp en t in p r e v i o u s tim e p e rio d s . T h e m a s te r b u d g e t plan c o v e r s the e n tire o rg a n i z a ti o n , w h e r e a s the d e p a r t m e n t a l o p e ra t in g b u d g e t d eals w ith the p la n s fo r the in d i v id ­ ual d e p a r t m e n t s w ith in the o rg a n iz a tio n . F o re c a s tin g p la y s an im p o r t a n t ro le in b u d g e ti n g . T h e l o n g e r the p erio d c o v ­ e red by a b u d g e t, th e m o r e im p o r t a n t and difficult a c c u ra t e fo r e c a s tin g b e c o m e s . T h e in f o rm a t io n flow fo r b u d g e ti n g w ith in an o rg a n i z a ti o n s h o u ld be u p w a rd an d d o w n w a r d th r o u g h the o rg a n i z a ti o n structu re. It is also im p o r t a n t to c o n s i d e r w h e th e r last y e a r ’s b u d g e te d e x p e n s e s are the a p p ro p r ia t e sta rtin g p o in t fo r c r e ­ a ting n e x t y e a r ’s b u d g e t o r w h e th e r all m a n a g e r s s h o u l d start at z e ro in m a k i n g u p th e ir b u d g e ts . U s u a ll y a c o m p r o m i s e b e tw e e n the tw o a p p r o a c h e s is best.

Case 10.1 Analyzing the Perform ance of a M e d ia C o m p a n y O b ta in a c o p y o f an a n n u a l r e p o r t for a p u b lic m e d i a c o m p a n y , such as G a n n e tt, K n ig h t R id d e r, o r A O L - T i m e W a r n e r , fro m the W e b . T h is can be d o n e by e n t e r ­ ing the U R L fo r the c o m p a n y ’s site o r e n te r in g the c o m p a n y ’s n a m e in a search e n g in e . R e v ie w the a n n u a l re p o r t fo r in f o rm a tio n a b o u t the c o m p a n y , p a y in g s p e c ia l a tte n tio n to the b a la n c e s h e e t an d an y a c c o m p a n y i n g e x p la n a tio n s .

A S S IG N M E N T W rite a re p o r t a n a ly z in g the c o m p a n y ’s a n n u a l re p o rt. D is c u s s w h e t h e r the c o m ­ p a n y s e e m s to be in g o o d fina ncia l h e a lth an d w h y . A ls o d is c u s s w h e th e r the

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c o m p a n y ’s e x p e n d it u r e s an d p e r f o r m a n c e o v e r the p a st y e a r s e e m p ru d e n t. Y ou m a y u se a v a rie ty o f o th e r in f o rm a t io n a b o u t th e c o m p a n y ’s h is to ry . A n s w e r all o f the fo l lo w in g q u e s t io n s in y o u r rep ort. 1. D o e s the c o m p a n y s e e m to be m a n a g e d w ell fin an cially s p e a k i n g ? W h y or w h y not? 2. D id the c o m p a n y a p p e a r to o p e ra te p ro f ita b ly ? W h y o r w h y n o t? ( I f the c o m p a n y re p o r te d a deficit, e x p la i n w h e t h e r it s e e m s to be in d ic a tiv e o f a p ro b l e m , o r w h e th e r it si m p l y r e p r e s e n ts s o m e th i n g lik e a o n e - t im e m a jo r p u rc h a s e th a t s h o u ld c o n tr ib u t e to th e lo n g - te rm g o o d o f th e c o m p a n y .) 3. D o th e m a j o r e x p e n d it u r e s o r p u r c h a s e s m e n t i o n e d in the re p o r t s e e m r e a ­ s o n a b l e g iv e n th e c o m p a n y ’s g o a ls ? W h y o r w h y n o t? (B e su re to id en tify the m a j o r e x p e n d it u r e s and th e ir a m o u n t s w h e n a n s w e r i n g this q u e stio n . A ls o note w h e t h e r no m a j o r e x p e n d it u r e s are listed in the rep o rt.) 4. D o yo u see any a c c o u n tin g p ra c tic e s o r item s in the rep o rt th at a p p e a r q u e s ­ tio nab le o r r e p r e s e n ta tiv e o f p o o r a c c o u n tin g p ra c tices ? If yes, identify these p ractices o r item s an d e x p la in w h y y o u th ink th ey are q u e stio n a b le . 5. W o u l d yo u r e c o m m e n d th a t s o m e o n e in v e s t in this c o m p a n y ? W h y or w h y not? 6. W h a t o th e r id e as , im p r e s s io n s , o r c o m m e n t s do y o u h a v e a fte r a n a ly z in g this c o m p a n y ’s p e r f o r m a n c e ?

Case 10.2 Forecasting Advertising Sales

S e le c t a lo cal n e w s p a p e r , m a g a z in e , b r o a d c a s t station , c a b le c o m p a n y , W e b site, o r an y o th e r lo cal m e d ia outlet. T r y to p re d i c t w h e t h e r a d v e rt is i n g sales will in c re a se o r d e c re a s e fo r th a t m e d i a o u tl e t o v e r the n e x t y ear. R e v ie w S h a v e r (1 9 9 5 ) , e s p e c i a ll y c h a p tc r 5, o r a n o th e r m e d i a sa les b o o k fo r id e a s on c o m p l e ti n g this a s s ig n m e n t . S h a v e r m e n t io n e d o t h e r d a ta s o u r c e s b e s i d e s th o s e listed here. T o g e t starte d, c o n ta c t the lo c al C h a m b e r o f C o m m e r c e to g e t in f o rm a tio n a b o u t e c o n o m i c in d ic a to rs. R e v ie w a n y local b u s i n e s s p u b li c a ti o n s or the b u s i ­ n ess sectio n o f y o u r lo cal n e w s p a p e r for in f o rm a tio n a b o u t the m a r k e t ’s e c o n ­ o m y o r b u s i n e s s o p e n in g s o r clo s in g s. R e v ie w r e l e v a n t n atio n a l tr a d e o r in d u s try p u b li c a ti o n s fo r in f o r m a t io n a b o u t tren d s in o r fo r e c a s ts o f a d v e rtis in g sales. A lso

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(h t t p : / / w w w . c e n s u s . g o v / e c o n / w w w / i n d e x . h t m l ). V isit the o n lin e h o m e p a g e s for trad e or in d u s try p u b li c a ti o n s a n d c o n d u c t o n lin e s e a r c h e s for fo r e c a s tin g or a d ­ v e rtis in g sales articles o r data. F o r e x a m p l e , visit A d v e r ti s i n g A g e (w w w . a d a g e . c o m ) o r A D W E E K ( w w w . a d w e e k . c o m ). A c c e s s the N e w s p a p e r A s s o c i a tio n o f A m e r i c a fo r in f o rm a tio n on n e w s p a p e r s ( w w w . n a a .o r g ). R e v ie w B r o a d c a s t in g &

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C a b le o n li n e ( w w w .b r o a d c a s l i n g c a b l e . c o m o r w w w . t v i n s i t e . c o m ). A s k y o u r p r o ­ fe s s o r fo r o t h e r o n lin e so u rc es.

A S S IG N M E N T W rite a re p o r t in d ic a tin g w h e t h e r a d v e rtis in g sale s s h o u ld in c r e a s e o r d e c re a s e fo r y o u r m e d i a o u tlet o v e r the n e x t year. In c lu d e the fo l lo w in g se c tio n s in y o u r report. 1. D is c u s s the o v e ra ll e c o n o m i c in d ic a to r s fo r y o u r m a rk e t. F o r e x a m p l e , arc m a n y n ew b u s i n e s s e s o p e n in g in the m a r k e t? A re m a n y b u s i n e s s e s c l o s ­ ing? W h a t is th e m a r k e t ’s u n e m p l o y m e n t level? W h a t are the la r g e s t e m ­ p lo y e r s in the m a r k e t? W h a t are the m a j o r retail c e n te rs an d h o w su c c e s sfu l are th e y ? A re th ere an y m a j o r p o sitiv e o r n e g a ti v e e c o n o m i c e v e n ts e x ­ p e c te d in y o u r m a r k e t? If yes, h o w m ig h t th ey affec t a d v e rtisin g sales? 2. A re a d v e rtis in g sales in g e n e ra l e x p e c t e d to in c re a se o r d e c re a s e d u rin g the c o m i n g y e a r? W h y ? 3. Id e n tify th e ty p e s o f firms, p ro d u c t s , o r se r v ic e s fo r w h ic h ad v e rtisin g s h o u ld in c r e a s e o r d e c re a s e d u ri n g the c o m i n g yea r. E x p la i n w h y th ese in ­ c re a s e s o r d e c r e a s e s are p re d ic te d . 4. E x p la i n w h e t h e r y o u r m e d i a o u tlet ca n e x p e c t a d v e rtis in g sa les to in c r e a s e o v e r the c o m i n g y e a r and w h y . P r o v i d e s u g g e s tio n s fo r n e w c lien ts to a p p r o a c h . P ro v i d e id eas fo r o th e r w a y s to g e n e ra t e a d d itio n a l r e v e n u e th r o u g h a d v e rtis in g sales b ased on y o u r res earch .

Case 10.3 Forecasting to Purchase a Radio Station

D e v e lo p a r e p o r t f o r e c a s tin g e c o n o m i c c o n d it io n s in a p a rt ic u l a r m a r k e t fo r each o f the n e x t 3 y ears. T h e r e p o r t s h o u l d in c lu d e , at m i n i m u m , the fo l lo w in g ty p e s o f e c o n o m i c a ctiv ities: e m p l o y m e n t , m a n u f a c tu r in g , retail sales, local tax es, h o u s i n g sales, an d a d v e rtis in g e x p e n d it u re s . T h e p u rp o s e o f th e r e p o r t is to d e ­ cide w h e th e r C a lla s C o m m u n i c a t i o n s s h o u ld p u r c h a s e a rad io statio n in the m a r ­ k et se le c te d . R ec a ll th a t C a l l a s ’ lo n g - te rm o b je c tiv e is p rim a rily to a c q u ir e m o r e T V sta tio n s and , if p o s s ib le , o th e r m e d i a a n d c o m m u n i c a t i o n s - r e l a t e d p ro p e rtie s. C a lla s s e e k s to id e n tify and a c q u ir e sta tio n s tha t h a v e the p o te n tia l fo r s u b s ta n tia l lo n g - te rm a p p re c ia tio n and p rofitab ility . S e le c t a m a r k e t to stu d y that can be re s e a r c h e d th r o u g h the lib rary or o n lin e e c o n o m i c re s o u rc e s . C o ll e c t d a ta a b o u t e a c h o f the a re a s listed p r e v i o u s ly , at

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m i n i m u m , fro m the p a s t 5 y ears . In te rv ie w p e o p le w h o are k n o w le d g e a b l e a b o u t m a r k e t e c o n o m i c in d ic a to r s, in c lu d in g e c o n o m i s t s , b u s i n e s s p e o p l e , lo cal g o v ­ e r n m e n t e c o n o m i c d e v e l o p m e n t staff, e m p l o y e e s fro m local m e d i a a d v e rtis in g d e p a r t m e n t s , g o v e r n m e n t o fficials, a nd b u s i n e s s re p o r te rs . R e v ie w lo cal b u s in e s s p u b li c a ti o n s o r the b u s i n e s s sectio n o f th e lo c al n e w s p a p e r fo r in f o r m a t io n a b o u t e c o n o m i c p re d i c ti o n s o r in d ic a to rs. A lso re v ie w the o n lin e s o u r c e s m e n t io n e d in C a se 10.2.

A S S IG N M E N T P re p a r e a th re e- to fiv e-p a g e re p o r t th at fo r e c a sts e c o n o m i c activ ity in th e s e ­ lected m a rk e t. T h e re p o r t s h o u ld d is c u s s the e c o n o m i c in d ic a to r s ju s t listed for e a c h o f the n e x t 3 y ea rs . C o n c l u d e the re p o r t by p re d ic tin g the stre n g th o f the m a r k e t ’s e c o n o m y d u rin g th e 3 - y e a r p erio d and w h e t h e r the e c o n o m y w ill be s tro n g e n o u g h to w a r r a n t C a l l a s ’ p u r c h a s e o f a ra d io station there.

Case 10.4 Analyzing a Budget

S e le c t a s t u d e n t n e w s p a p e r , ra d io , o r T V station . A s k the d ir e c to r fo r a c o p y o f the m e d i a o u t l e t ’s b u d g e t p re f e ra b ly from the last sev eral years. R e v ie w the b u d ­ g et to see th e o u t l e t ’s m is s io n s t a te m e n t o r g o a ls an d h o w e x p e n s e s h a v e c h a n g e d o v e r tim e. H a v e the d ir e c to r visit the c la s s to d is c u s s the b u d g e ti n g p ro c e s s , in c lu d in g m a j o r p u r c h a s e s m a d e d u ri n g the b u d g e ti n g p e rio d re v ie w e d .

A S S IG N M E N T W rite a re p o r t a s s e s s in g the o u t l e t ’s b u d g e ti n g p ro c e s s. A n s w e r all o f the f o l l o w ­ ing q u e s t io n s in the rep ort. B e p r e p a r e d to sh are the re p o r t w ith the m e d i a o u t ­ l e t ’s b u d g e t d irecto r. 1. D o e s the o u tle t use last y e a r ’s b u d g e t as the sta rtin g p o in t fo r th e a n n u a l b u d g e ti n g p ro c e s s , z e r o - b a s e d b u d g e ti n g , o r b o th ? S h o u ld

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c h a n g e its startin g p o in t? W h y o r w h y not? 2. W h ic h item s o r c a te g o rie s in the b u d g e t h av e the larg est a llo c a tio n s? W h y ? 3. D o the c a te g o rie s o f e x p e n s e s in th e b u d g e t see m c o m p l e te ? D o ad d itio n a l c a te g o rie s n e e d to be a d d e d ? W h y o r w h y not?

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4. D o e s it a p p e a r th a t o n e o r m o r e c a te g o rie s o f e x p e n s e s h a v e c h a n g e d in im p o r t a n c e o v e r tim e ? W h y ? 5. W h i c h e m p l o y e e s are in v o l v e d in the b u d g e t d e v e l o p m e n t p r o c e s s at the m e d ia o u tle t? S h o u ld o th e r e m p l o y e e s be in v o l v e d ? W h y o r w h y n ot? 6. H o w d o e s in f o r m a t io n flow d u rin g the b u d g e ti n g p ro c e s s at the o utlet: u p ­ w a rd , d o w n w a r d , o r b o th ? S h o u ld the flow o f in f o rm a tio n b e c h a n g e d ? W h y o r w h y not? 7. D o c s the m e d ia ou tlet seem to be trying to fulfill orga niz atio nal go als th ro ug h its bu d g e tin g p ro cess an d actual b u d g e t allocation s? W h y o r w h y not? 8. D o e s the m e d i a o u tle t h a v e a g o o d , effe c tiv e b u d g e ti n g p r o c e s s ? W h y or w h y no t?

Case 10.5 Cutting the Budget at K H I T - F M

T h e g e n e ra l m a n a g e r at K H I T - F M j u s t in f o r m e d the sales and p r o g r a m m i n g m a n a g e r s th a t e m p l o y e e s o f the local a u to m o ti v e c o m p a n y w ill go on strike t o ­ m o r ro w . T h e strike is e x p e c t e d to last se v e ra l w e e k s , p o s s ib ly s e v e r a l m o n t h s , c r e a tin g a m a j o r p ro b l e m in the lo ca l e c o n o m y . It is e s t im a te d th a t o v e ra ll retail e x p e n d it u r e s will d ro p h a l f a p e r c e n t for e v e ry w e e k th e e m p l o y e e s are on strike. T h e g e n e ra l m a n a g e r w a n ts to retain p la n s fo r p la c in g a rc h i v e d a u d io o n lin e b e c a u s e top m a n a g e m e n t at C a ll a s C o m m u n i c a t i o n s a g re e s that it r e p r e s e n ts a stro n g pro fit v e n tu re . O t h e r w a y s to m a in ta in p ro fitability m u s t be fo un d. R e v ie w T a b le s 10.2 an d 10.3, the m a s te r b u d g e t plan fo r K H I T - F M . (T h e n o n ­ o p e ra tin g e x p e n s e s s h o w n there are fixed an d c a n n o t be c h a n g e d .) A ls o review the in fo rm a tio n a b o u t K H I T - F M d is c u s s e d in this ch apte r. C o n s id e r o th e r w a y s to cu t the b u d g e t o r d e v e lo p a d d itio n a l so u rc e s o f r e v e n u e g iv e n the im p e n d in g strike. T ry to e stim a te the a m o u n t o f a d v e rtisin g r e v e n u e s that K H I T - F M m ay lose d u e to the strike.

A S S IG N M E N T C re a te a n ew b u d g e t to m e e t the profitab ility r e q u i r e m e n ts o f C a lla s. M a k e s u g ­ g e s tio n s as to w h ic h p a rts o f the b u d g e t m a y be c u t an d e x p la in w h y . W rite a re p o r t tha t a n s w e r s all o f the fo l lo w in g q u e stio n s. 1. H o w m u c h a d v e rtis in g r e v e n u e m a y b e lost d u e to the strik e? H o w w a s the e s tim a te c a lc u la te d ? 2. H o w s h o u ld K H I T - F M r e s p o n d to the p o s s ib le strik e ? W h ic h b u d g e t c a t e ­ g o rie s s h o u l d b e c u t (an d by h o w m u c h ) o r e li m i n a te d if the strik e lasts for several w eeks or m onths? W h y ?

BU D G E TIN G A N D DECISION M A K IN G

283

3. W h a t a d d i t i o n a l s o u r c e s o f r e v e n u e m i g h t th e s t a ti o n ta p ? E x p l a i n i d e a s f o r g e n e r a t i n g a d d i t i o n a l r e v e n u e f o r th e s ta ti o n g i v e n th e i m p e n d i n g strik e . 4. P r e s e n t a n e w b u d g e t f o r K H I T u s i n g th e f o r m a t s h o w n in T a b l e 10.2. 5. E x p l a i n w h y th e n e w b u d g e t w ill a ll o w th e s ta ti o n to m e e t its p r o f it g o a l for n e x t y e a r (or increase to $ 1 7 2 , 5 0 0 ) .

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IN T R O D U C T I O N N e w s p a p e r s acro ss the co un try arc facing a loss o f read ers, esp ecially a m o n g y o u n g e r A m e ric a n s, and m ust co ntin u e to d ev elo p new w a y s to use an d profit from the Internet. M ed ia org an iz atio n s o f all kinds face b u d g e t cuts and layoffs. F utu re m a n a g e rs m u st c o n sid e r strategies to h and le such difficult situations w ith ­ out m a k in g m atters w orse. T he e x tend e d case studies feature fictitious ch aracters at fictitious m ed ia org an iza tio n s facing fictitious situations. H o w e v e r, both e x ­ tended cases are b ased on real-life ev ents and rep resen t the kinds o f p ro b lem s and issues that m ed ia m a n a g e rs face on the jo b. E x te n d e d C ase 1 e n c o m p a sse s co n c ep ts co v ere d th ro u g h o u t the book. It can be used as a m ajor end-of-th e-sem e ster assignm ent, an assig n m en t to co v e r c e r­ tain course seg m en ts or several chapters (e.g., assign Q u estion s 1 and 2 after c o v ­ ering chaps. 1, 2, 3, 4, and 6 in class), or an assig nm ent e n co m p a ssin g one or a few ch apters (e.g., assign only Q u estio n 5 after c o v e rin g chap. 6 or assign only Q u estio n 8 after c o ve rin g chaps. 5 and 6). O ne or m o re q u estio ns can be as­ signed from it only o nce durin g the sem ester. It can also be used in a holistic and c o m p r e h e n s iv e app ro ach to d ealing with organ iza tion al p ro b le m s by assigning different questio ns from the case at several points during the sem ester. U sing the holistic ap p ro ach allo w s students to see ho w c h a n g e s in o ne area o f the firm affect oth er d ep artm e n ts o r decisio ns in that sam e organization. E x te n d e d C a se 1 also can be used for ind ivid u al an d /o r g rou p a ss ig n m e n ts so students learn and app ly the ind ivid ua l and gro up d e c is io n -m a k in g aspects c o v ­ ered in the book. For exam p le, have students w o rk in d ividually on one question in the case. T h en h a v e them w ork in team s on several question s in the ease at m id term . H ave team s w o rk on all or m a n y o f the e a s e ’s q u e stion s as a final co u rse project. T he go al is to give professors and students the m o s t flexibility in using the e ase to allow fo r different teach ing and learning styles. M an y so urces are included in E xte n d ed C a se I to aid students and professors. T h e goal is to teach students to locate, assess, and an alyze a variety o f data. T h a t is w hy the case directs you to select a m a jo r city close to you. Professo rs often 284

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already have data abou t nearby cities or m edia m ark ets that can be used for this case. T his allo w s professors to tailor the case to m eet their o w n le arning goals and use m aterial they already have. P ro fesso rs are also urged to ex am in e the sou rces included in the case and se­ lect th ose m ost a pp rop ria te to their go als and teach in g styles. A fter p ublication, so m e o f the Internet ad d resses in the c ase co uld c h a n g e or disappear. Students cou ld find the n u m b e r and types o f so urces in the case o v e rw h e lm in g if th ey re­ ceive little or no g u id a n c e in usin g them . F o r ex am p le , if the coursc is taug ht in a co m p u te r lab (or could be for a short period o f time), the class as a w hole could take a day or w eek to co n d u c t an Inter­ net and database search to locate in form ation to share. D ifferent search objectives could be assigned to different students or te am s in the class. If useful articles are found in the d atabase searches (e.g., A B I In fo rm /P roQ uest, L exis-N exis, E bsco), students could e-m ail them to the professor, w h o could then give e-m ail or hard copies to the entire class. If useful Internet sites are found, the ad dresses could be shared with the class as well. By dividing the m ajo r search goals and sharing w hat is found, m u ch inform ation to use in w o rkin g on the case can be obtained quickly. E xtend ed C ase 2 provides inform ation and practice in dealing with the difficult prob lem s o f restructuring and layoffs. It provides a different type o f m ajor case, allow ing students to deal with a m o re focused, yet still c o m p reh e n siv e and vexing m a n a g e m e n t situation. Students m ust con sid er the m anagerial, organizational, structural, legal, ethical, and hu m an c o n seq u e n c es o f the decisions they m ake. In su m m a ry , o ne goal in both exte n d e d cases is to giv e students a c h a n c e to c o n sid e r m ajo r p ro b le m s they are likely to face at v arious points in their careers. A secon d goal is to prov id e a variety o f real-life situ ations to apply th eory, re­ search, and data analysis. A third goal is to give students a b etter p erspectiv e on how sm aller p ro b le m s se em ing ly un iq u e to on e d ep a rtm e n t o r situation are inter­ related w ith, and n ot n ecessarily in d e p e n d e n t of, larger m o r e c o m p le x o rg a n iz a ­ tional problem s.

Extended Case 1 The Case of Change at a Newspaper

Coy Parker, the W h ite m a n ag in g edito r o f the M etro p o lis M o rn in g H e ra ld , faced som e serious prob le m s. He had ju s t m et with Jack so n T en killer, his pu blish er w h o w as a m e m b e r o f the A n iw a y a o r W o l f clan o f the C h e ro k e e nation a b o u t the p a p e r ’s declin ing readership. Ja ck so n w o rried th at circulation c o n tin ued to d ecline a m o n g y o u n g e r adults and said a plan w as n eeded to deal w ith the re ad ­ ership problem . W e ’ve g o t to stop this de c lin e b efo re it g ets m u c h w o r s e . W e n e e d to find o u t w h y w e ’re lo sing r e a d e r s a n d c a n ’t attract y o u n g e r rea d e r s. O n c e w e find th at out,

286

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I w a n t to in v e s ti g a t e the t y p e s o f c o n t e n t to c h a n g e o r a d d to the p a p e r a n d W e b site, w h a t n e w s e c t i o n s o r t y p e s o f st o r i e s w e m i g h t d e v e l o p , a n d w h a t e l s e w e ca n d o to a t t r a c t n e w r e a d e r s a n d r etain th e o l d o n e s . O u r W e b p a g e i s n ’t g e n e r a t i n g an y m e a n i n g f u l r e a d e r in t e r e s t o r r e v e n u e fo r us. W e ’v e g o t to find n e w w a y s to u s e it.

J a c k s o n said , “ W h il e w e ’re try in g to figure tha t ou t, M c g a M c d i a w a n ts us to c rea te m o r e s y n e r g y a m o n g its m e d i a p ro p e r tie s o w n e d locally. W e n e e d to use all o u tle ts to c r o s s - p r o m o te e a c h o th e r .” T h e M c g a M c d i a C o m p a n y w a s a larg e n atio n a l g r o u p that o w n e d n e w s p a p e r s , T V an d ra d io statio n s, m a g a z in e s , o u t ­ d o o r/ b il lb o a rd , a n d e le c tro n ic in f o rm a tio n and p u b li s h i n g firms. L o c a lly , M e g a M e d i a o w n e d the M e t r o p o li s M o r n in g H e r a l d , th e local N B C -a f filia te d T V statio n , an a ll -n e w s talk A M statio n, an d a to p - 4 0 hit FM ra d io station. M e g a M e d ia had p u rc h a s e d a serv er-based n e w s ro o m for its m e d ia outlets in the m a rk e t to share. A n y video or digital p h o to g ra p h that w as sho t in the field o r c a m e in by satellite w o u ld g o directly into the server. V id e o ta p e w o u ld no lo n g e r be n eed ed, an d co n te n t cou ld be easily adap ted for print, b roa dca st, or stre am in g on the Internet. S everal rep orters and e m p lo y e e s co uld view and edit a story at their d esk to p s w hile it w a s b eing edited e ls e w h e re (H u d so n , 2002). M e g a M e d i a ’s e v e n ­ tual goal w as to be the m u ltim e d ia n e w s le ade r in M etro p o lis, but felt this new te c h ­ no log y could ease cro s s-p ro m o tio n a m o n g its va rio u s local outlets. T h e m a in server and e q u ip m e n t w ere ho u sed at the local N B C T V station, but w ere accessible by e-m ail and the Internet to the o th er locally o w n e d outlets. E d itin g stations w ere located at the T V station, radio stations, In tern et office, an d n e w s p a p e r n e w sro o m . B u y in g s e r v e r-b a s e d n e w s r o o m t e c h n o l o g y w a s pa rt o f M e g a M e d i a ’s lo n g ­ term goal o f d e v e lo p i n g p a rt n e r s h i p s to sh a r e n e w s c o n te n t an d p ro m o ti o n a l o p ­ p o rtu n itie s to reach a b r o a d e r a u d ie n c e in M e t r o p o li s ( F u q u a y , 2 0 0 2 ). E ach o u tle t c o u ld e v e n tu a lly sh a re s t o r y - p l a n n in g b u d g e ts . P re s e n tly the T V s t a ti o n ’s m e t e o r o l o g is t a p p e a r e d on the n e w s p a p e r ’s w e a t h e r pag e. H e r a l d re p o r te rs , e d i ­ tors, an d c o l u m n is ts w e re o c c a s i o n a l g u e sts on the n c w s - t a lk ra d io statio n and T V n e w s c a s t s . J a c k s o n said, M e g a M c d ia k n o w s c o n v e r g e n c e or p a rtn ersh ip s b e tw e e n n e w s p a p e rs, television, r a d i o an d o n l i n e sites a r e b e c o m i n g m o r e c o m m o n . A b o u t 1 0 0 m e d i a p a r t n e r s h i p s e x i s t a l r e a d y , t h o u g h m o s t a r e p r o m o t i o n a l . O n l y a d o z e n o r so s h a r e n e w s r e p o r t s a n d r e s o u r c e s . B u t i f w e w o r k e d t o g e t h e r the n e w s p a p e r c o u l d b r e a k s t o r i e s o n l i n e o r on r a d i o o r T V , o r v i c e v e r s a . M e g a M e d i a ’s t o p m a n a g e m e n t fe e l s w e c o u l d a t ­ tr a c t y o u n g e r v i e w e r s a n d l i s t e n e r s to th e n e w s p a p e r f o r m o r e i n - d e p t h c o v e r a g e o f i m p o r t a n t l o cal s t o r i e s u s i n g c r o s s - p r o m o t i o n .

J a c k s o n h a d o t h e r id e a s to c o n s i d e r too. T h e r e w a s an article in T h e Q u ill a b o u t h o w the O rlando Sentinel is tr y in g to attr a c t th e S p a n i s h - s p e a k i n g c o m m u n i t y ( O r l a n d o S e n t i n e l R e a c h e s , 2 0 0 1 ) . I t ’s s h a r i n g e d ­ itorial c o n t e n t w i t h a p o p u l a r local S p a n i s h - l a n g u a g e m u s i c r a d i o s t a tio n , as w ell as s h a r i n g n e w s an d p r o m o t i o n a l e f f o r t s w i t h lo c a l U n i v i s i o n an d T e l e m u n d o affiliated te l e v i s i o n s t a tio n s . T h e Sentinel sta rte d p u b l i s h i n g a fre e w e e k l y b i l i n g u a l e d itio n

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c a l l e d E l S e n t i n e l , to o , s o t h e y ’re r e a lly g e t t i n g th e i r n a m e o u t th e r e in th e H i s p a n i c c o m m u n i t y . G i v e n th e m u l t i c u l t u r a l n a t u r e o f M e t r o p o l i s , th is s e e m s lik e s o m e t h i n g w e m i g h t c o n s i d e r w h e n w e ' r e t h i n k i n g a b o u t n e w c o n t e n t a n d p r o m o t i o n a l id e a s .

C o y sa id , W e c a n s ta rt b y r e v i e w i n g th e r e s u l t s o f th e I m p a c t P r o j e c t s t u d y c o n d u c t e d by N o rth w e ste rn

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N e w s p a p e r E d i t o r s a n d th e N e w s p a p e r A s s o c i a t i o n o f A m e r i c a ( F i t z g e r a l d , 2 0 0 1 ; w w w . r e a c l e r s h i p . o r g ). T h e y s u g g e s t i m p l e m e n t i n g e i g h t c h a n g e s to r e v e r s e the lo n g -te rm d e c lin e o f n e w s p a p e r re a d e rsh ip . F o r e x a m p le , th ey fo u n d ru n n in g in ­ p a p e r p r o m o t i o n s o f t h e i r s t o r i e s i m p r o v e d th e p a p e r ’s m a r k e t i m a g e a n d i n c r e a s e d re a d e r satisfactio n . T h e Institute said d e v e lo p in g h ig h -q u a lity c u s to m e r service, m a k i n g th e p a p e r e a s i e r to n a v i g a t e a n d r e a d , e m p h a s i z i n g e v e r y d a y p e o p l e in a r t i ­ c l e s , u s i n g th e f e a t u r e s t y l e f o r h a r d n e w s s t o r ie s , u s i n g i m a g e a d s to p r o m o t e th e p a p e r , u s i n g a d v e r t i s i n g to i m p r o v e r e a d e r s h i p t h r o u g h o u t th e p a p e r , a n d c h a n g i n g th e m i l i t a r y - s t y l e c o r p o r a t e c u l t u r e f o u n d at m o s t p a p e r s w o u l d h e l p . ( F i t z g e r a l d , 2001; w w w .re a d e rsh ip .o rg )

C oy continued, F r a n k l y , I h a v e n ’t d o n e a n y o f th is b e c a u s e it s e e m s o p p o s e d to g o o d j o u r n a l i s m as I ’v e a l w a y s p r a c t i c e d it. I t h i n k m o s t r a d i o a n d T V n e w s is “ g o s s i p y ” a n d fu ll o f fluff. I ’m n o t w i l d a b o u t h a v i n g to w o r k w i t h r e p o r t e r s a n d e d i t o r s at th e r a d i o a n d T V s t a t i o n s , e v e n t h o s e o w n e d b y th e s a m e c o m p a n y . I ’v e a l w a y s p r i d e d m y s e l f in s c o o p i n g e v e r y b o d y e l s e in t o w n . I r e a l ly w o n d e r w h e t h e r t h e s e i d e a s w ill w o r k o r w h e t h e r i t ’s all j u s t th e la t e s t b u z z w o r d w e ' v e g o t to try to m a k e o u r o w n e r s h a p p y .

J a c k s o n r e pl i e d , C o y , I ’m s y m p a t h e t i c . B u t if w e d o n ’t h a v e a n y r e a d e r s w h o r e a d o u r s c o o p s , it d o e s n ’t m a t t e r h o w m a n y s c o o p s w e g e t. Y o u k n o w

n e w s p a p e r r e a d e r s h i p is

s t r o n g e r a m o n g o l d e r a g e g r o u p s a n d w e a k e r a m o n g th e y o u n g e s t a d u l t g r o u p s . O n l y 18 p e r c e n t o f 18 - t o - 2 2 - y e a r - o l d s r e a d a n e w s p a p e r d a i l y in 1 9 9 6 , d o w n f r o m 4 7 p e r c e n t in 1 9 7 2 . O u r o l d e r r e a d e r s are d y i n g o f f f a s t e r th a n o u r y o u n g e r o n e s are b e i n g c r e a t e d ( M o r t o n , 2 0 0 2 , p. 6 4 ). A n d k id s b o r n in to n e w s p a p e r - r e a d i n g f a m i ­ lies t e n d to r e a d t h e m ; t h o s e b o r n in n o n - r e a d i n g f a m i l i e s d o n ' t . W e ’v e g o t to fig ­ ure o u t h o w

to a t t r a c t n o n - r e a d e r s a n d y o u n g r e a d e r s w h i l e m a i n t a i n i n g th e

j o u r n a l i s t i c s t a n d a r d s w e b e l i e v e in. T h e b o t t o m line is c h a n g e is c o m i n g a n d w e ’v e g o t to find a w a y to a d a p t.

Jackson continued, M e g a M e d i a w a n t s us to i m p r o v e o u r W e b site a n d m a k e it e c o n o m i c a l l y v ia b l e . T h e r e h a v e b e e n a f e w c o m p l a i n t s a b o u t ra c i s t a n d s e x i s t c o m m e n t s in o u r c h a t r o o m so w e ’v e g o t to fig u re o u t h o w to ta k e c a r e o f th a t. W e n e e d to b u i l d in t e r e s t in a n d traffic to o u r W e b s ite , e s p e c i a l l y a m o n g y o u n g a d u l t s . S h o u l d w e d r o p th e c h a t r o o m ? S h o u l d w e i m p o s e s o m e k i n d o f c o n t r o l s o n it? H o w s h o u l d w e c h a n g e o u r W e b s i te ? W h a t e ls e c a n w e d o to i m p r o v e r e v e n u e a n d i n t e r e s t in th e site ? W e n e e d to find o u t h o w to b e t t e r u s e o u r W e b site to b u i l d r e a d e r s h i p a n d r e v e n u e s .

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C o y re tu rn e d to his o ffice fo r a m e e tin g w ith A lia h S h e b ib , a n a tu r a liz e d A m e r i c a n C itiz e n fro m L e b a n o n , w h o h ad a rriv e d e a rly to d a y an d w a s w a itin g for h im w h e n h e a rr iv e d at w o rk . A lia h said, “ I ’ve b e e n c o v e r i n g ‘S o c k J o b s ’ p a rt-tim e fo r s e v e n m o n t h s n o w . ” ( S o c k J o b s w e re w h a t e m p l o y e e s d e risiv e ly c alled the so c ie ty article s an d c o lu m n s th e y w r o te fo r the p a p e r ’s S o c ie ty s e c ­ tion. C o v e r in g su ch social e v e n ts , fu n d r a is e r s , c h a rity g o l f t o u r n a m e n t s , and so on w a s h is to ric a lly u n p o p u l a r w ith the ed ito ria l staff. S o c k J o b s w e re ty p ically a s s ig n e d to the n e w e s t g e n e ra l a s s ig n m e n t r e p o r te r w ith th e s h o r te s t te n u r e at the pap er.) C o y said, “ Y e s, an d y o u ’ve b e e n d o in g an e x c e l le n t j o b . ” A lia h r e ­ s p o n d e d , “T h a n k y ou . A n d I a p p re c ia te the o p p o r t u n it y y o u ’ve g iv e n m e . B ut I ’m r e a d y to ta ck le new c h a ll e n g e s . N o w tha t m y s ix - m o n t h p r o b a t io n a r y p erio d is o v e r I ’d like to be re a s s ig n e d to a d if fe re n t b e a t. ” “ A re yo u u n h a p p y w ith y o u r j o b ? ” C o y a sk e d . “ I ’m u n h a p p y c o v e r i n g so ciety stories. L ik e m o s t jo u r n a li s ts , I ’d r a t h e r c o v e r h a rd n e w s sto ries or do i n v e s ti g a ­ tive re p o r tin g full-tim e . I u n d e r s ta n d th e p a p e r m a y n o t h a v e the r e s o u rc e s to s u p p o r t a fu ll-tim e in v e s tig a tiv e rep o rte r. B u t if I w e re g iv en a s e rio u s n e w s bea t I c o u ld tu rn in m y d aily stories and w o rk on m a j o r in v e s ti g a ti v e p ie c e s on the side. I ’d be w illin g to d o th a t .” C o y r e p lie d , “ W h a t b e a t w o u ld y ou li k e ? ” A lia h re s p o n d e d , W c h a v e a n u m b e r o f m i n o r i t y c o m m u n i t i e s in th e ci t y th a t r e a l l y a r e n ’t c o v e r e d in d e p t h b y th e p a p e r . W h y h a s n ’t t h e p a p e r e v e r r e a l l y m a d e a s e r i o u s e f f o r t to c o v e r s o c i a l , e c o n o m i c , a n d racial i s s u e s r e g a r d i n g th e m a j o r H i s p a n i c a n d A s ia n c o m ­ m u n i t i e s h e r e ? W e ’v e g o t a s i g n i f i c a n t n u m b e r o f i m m i g r a n t s fro m M e x i c o as w e l l as C e n t r a l a n d S o u t h A m e r i c a . O u r V i e t n a m e s e a n d K o r e a n c o m m u n i t i e s ar e a m o n g the l a r g e s t in the U . S . W e ’v e a l s o g o t a fairly la r g e M u s l i m p o p u l a t i o n . A n d like m o s t b i g c i t i e s w e h a v e a l a r g e A f r i c a n - A m e r i c a n p o p u l a t i o n . Y e t w e ' v e n e v e r d o n e any significant c o v e ra g e or in v es tig ativ e reports o f these c o m m u n itie s. Lately it s e e m s w e c o v e r i n c i d e n t s o f h a r a s s m e n t o r d o ‘l o o k h o w t h e s e f o l k s h a v e a c h i e v e d th e A m e r i c a n D r e a m ’ sto r ie s . W h y h a v e n ’t w e d o n e a n y i n - d e p t h c o v e r ­ a g e fro m m i n o r i t y v i e w p o i n t s a b o u t m i n o r i t y i s s u e s ? M o r e i m p o r t a n t , w h y a r e n ’t w e c o v e r i n g s u c h i s s u e s in th e c o n t e x t o f th e c o m m u n i t y as a w h o l e ?

C o y w as su rp rised by A l i a h ’s c o m m e n ts an d said, “ I th o u g h t w c did a g o o d jo b o f c o v erin g m in o rity stories. W h y ju s t last w eek G re g J o h n s o n did the story on the su cce ssful K orean g ro c e r .” “T h a t w as a g o o d , h e a rt-w a rm in g story,” said Aliah. “ B ut s o m e K o rean s p riv ately told m e they th o u g h t it w as p atro nizing . T h e y said, ‘W h y d o e s n ’t the p a p e r e v e r c o v e r d is c rim in atio n o r ch e c k into the allega tion s o f to u g h e r insp ectio ns b y the H ealth D e p a rtm e n t o f m ino rity re s ta u ra n ts ? ’ ” C o y replied, “ Y ou m e a n there are alleg atio ns that the H ealth D e p a r tm e n t is d is c rim in a t­ ing ag ain st m in o rity re s ta u ra n ts? ” “ Y e p ,” said A lia h, “ and I ’ve h eard th e y ’re a s k ­ ing for b ribes.” “W h e r e ’d you h e a r th at? ” “ It w a s in the K o rean la n g u a g e w eek ly. A rep o rter there told m e a b o u t it,” A liah said. “ W ell, th a t’s so m e th in g w e o u g h t to be c o v erin g , to o ,” C o y said.

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C o y t h o u g h t a m o m e n t a n d th e n to l d A lia h , J a c k s o n a n d I w e r e j u s t d i s c u s s i n g h o w to r e b u i l d r e a d e r s h i p . I ’m g o i n g t o t a l k to t h e s t a f f a b o u t it s o o n . P l e a s e s t a rt f o r m u l a t i n g y o u r i d e a s a n d c o m e u p w i t h as m a n y s p e c i f i c s u g g e s t i o n s a s y o u c a n . I ’m g o i n g to b e a s k i n g e v e r y o n e to t h i n k a b o u t p o t e n t i a l n e w c o n t e n t a n d t y p e s o f s t o r i e s o r s e c t i o n s to d e v e l o p . T h e n w e ' l l p r o b a b l y c o n d u c t r e s e a r c h to d i s c o v e r w h a t r e a d e r s w a n t a n d f i g u r e o u t w h a t t o d o . W e a l s o n e e d t o c o n s i d e r h o w to b u i l d i n t e r e s t in o u r I n t e r n e t site.

“ O K , ” sa id A l i a h , “ I ’ll c o m e u p w i t h s o m e i d e a s . O h , G r e g sa id h e w a n t s to ta lk to y o u t o o . ” “ S e n d h i m i n , ” C o y sa id . G r e g J o h n s o n , th e H e r a l d ' s r e s p e c t e d b u s i n e s s c o l u m n i s t a n d r e p o r t e r , w h o w a s A f r i c a n - A m e r i c a n , c a m e in a n d sat d o w n . “ W h a t ’s u p ? ” C o y sa id . “ W e l l , I ’ve g o tt e n an o f f e r f r o m th e L o s A n g e l e s T i m e s . A r e y o u g o i n g to c o u n t e r ? ” C o y sat d u m b f o u n d e d f o r a m o m e n t a n d th e n s a id , “ O f c o u r s e I ’m g o i n g to m a k e a c o u n t e r o f f e r ! D i d n ’t y o u k n o w I w o u l d ? ” “ H o n e s t l y C o y , n o , I ’m n o t s u r e h o w y o u fe e l a b o u t m y w o r k o r m e . Y o u a p p e a r to h a v e a f e w f a v o r i t e r e ­ p o r t e r s y o u talk to all th e ti m e . Y o u r a r e ly ta lk to m e so I d o n ’t k n o w w h a t y o u t h i n k . I ’ve w o n d e r e d w h e t h e r y o u ’re j u s t u n c o m f o r t a b l e in g e n e r a l w ith p e o p l e o f co lo r.” “ N o , t h a t ’s n o t it at all,” said C o y . “ Y o u j u s t n e v e r s e e m e d in te re s te d in ta lk in g so I t h o u g h t I w a s r e s p e c ti n g y o u r w i s h e s a n d le a v in g y o u a lo n e to d o y o u r w o r k . ” “ I t ’s n o t t h a t I d o n ’t w a n t to ta l k ,” r e p l i e d G r e g , “ a n d I m e a n n o d i s r e s p e c t ; i t ’s j u s t th a t I d o n ’t w a n t to talk a b o u t o ld n e w s r o o m w a r s t o r ie s all th e tim e . I w a s n ’t h e r e th e n . T h e H e r a l d d i d n ’t e m p l o y a n y r e p o r t e r s o f c o l o r a t th a t tim e . A n d t h a t ’s all y o u , D a v e , a n d E d w i n s e e m to w a n t to ta lk a b o u t: w h a t th i n g s u s e d to b e li k e . ” D a v e C r e i g h t o n a n d E d w i n J a m e s , w h o w e r e W h i t e , h a d b e e n r e p o r t e r s at th e H e r a l d fo r m o r e th a n 3 0 y e a r s . C o y h a d w o r k e d t h e r e fo r m o r e t h a n 35 y e a r s . “ W e l l , I ’m s o r ry , G r e g . I d i d n ’t k n o w y o u felt th a t w a y . I ’m r e a l ly s u r p r is e d y o u d i d n ’t th i n k I ’d g o to b a t w i t h J a c k s o n a n d M e g a M e d i a to k e e p y o u h e r e . ” C o y c o n t i n u e d , “ Y o u ’ve g o t t e n g o o d p e r f o r m a n c e r e v i e w s th e t w o y e a r s y o u ’v e b e e n h e re . B e c a u s e o f th a t I t h o u g h t y o u k n o w h o w m u c h I r e s p e c t w h a t you d o .” G reg replied. W ell, y o u r p e rfo rm a n c e ev alu atio n s are very d ifferen t than the o n es I had befo re I c a m e here. I w a s g iv en v e ry specific c o m m e n ts , d e ta ile d su g g e stio n s fo r i m p r o v e ­ m e n t , a n d g o a l s to a c h i e v e . M o s t l y w h a t I r e c a l l f r o m y o u r e v a l u a t i o n s a r e v a g u e c o m m e n t s l i k e , “ Y o u ’re d o i n g a p r e t t y g o o d j o b . W o r k o n y o u r w r i t i n g s t y l e . E x ­ p a n d y o u r b u s i n e s s c o n t a c t s . ” T h a t r e a l l y d o e s n ’t g i v e m e m u c h d i r e c t i o n . A n d f r o m t h e w a y I h e a r D a v e a n d E d w i n t a l k , it s o u n d s l i k e I h a v e n ' t g o t t e n t h e r a i s e s they did. T h e p e rfo rm a n c e e v alu atio n sy stem and c o m p e n s a tio n p ractices w o u ld h a v e to c h a n g e i f I s t a y e d .

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“ I c a n ’t tell yo u a b o u t th e ir e v a lu a tio n s , t h a t ’s c o n fid e n tia l. B u t w h a t I c a n tell y o u is th a t I ’v e a lw a y s r e c o m m e n d e d y ou fo r h ig h e r th an a v e ra g e raises. I ’m s u r ­ p rised y o u ’d th in k o th e r w is e . W h y d i d n ’t yo u talk to m e a b o u t this b e f o r e ? ” G re g re p lied . C o y , I w a s n ’t s u r e y o u ’d b e r e c e p t i v e . I feel lik e y o u a n d I w o r k in t w o d i f f e r e n t n e w s r o o m s . A l i a h a n d I c a n talk a b o u t a lot o f t h i n g s t h a t I h a v e n ’t felt c o m f o r t a b l e t a l k i n g a b o u t w i t h y o u . T h a t ’s a n o t h e r r e a s o n 1 w e n t on t h e i n t e r v i e w at th e T i m e s . I w a n t m o r e c h a l l e n g e s a n d a m o r e c o m f o r t a b l e w o r k e n v i r o n m e n t . I r e a l l y l o v e it h ere in M e t r o p o l i s . B u t if I ’m g o i n g to sta y the e n v i r o n m e n t w i l l h a v e to c h a n g e .

C o y said, I ’m g l a d y o u ’re b e i n g h o n e s t w i t h m e , G r e g . I d o v a l u e y o u a n d I w a n t to k e e p y o u . I d i d n ' t r e a l i z e all o f th is a n d I ’m g l a d y o u ’ve p o i n t e d it o u t to m e . I ’m c e r t a i n l y w i l l i n g to u p d a t e th e p e r f o r m a n c e e v a l u a t i o n s y s t e m . I t h i n k it ’s p r e t t y a r c h a i c m y ­ self. I ’d like to w o r k w i t h y o u to i m p r o v e th e n e w s r o o m e n v i r o n m e n t . I f a r e p o r t e r a n d c o l u m n i s t o f y o u r c a l i b e r c a n ’t b e c o m f o r t a b l e h e r e , t h e n I w a n t to c h a n g e that. I h o p e y o u ’ll g i v e m e t h e c h a n c e .

G re g said, “T h a n k s . I really a p p re c i a te y o u r attitu d e , C o y . B u t re a liz e th at I ’m se rio u s. It’s g o in g to tak e m o r e th an a b e tt e r c o m p e n s a t i o n p a c k a g e to k e e p m e here. I th in k c h a n g e s are n e e d e d in the n e w s r o o m c u ltu re an d p e r f o r m a n c e e v a l ­ uation p r o c e s s .” D a v e a nd E d w i n w a lk e d in C o y ’s o ffice an d sh u t the d o o r righ t a fte r G re g left. “ Is it true h e ’s g o tte n an o ffe r fro m the L .A . T i m e s T ’ a s k e d D a v e . C o y n o d ­ d e d an d E d w i n said , “ G o o d r i d d a n c e . H e ’s n e v e r b e en a team p l a y e r a n y w a y . ” C o y said, “ W h a t a re y ou ta lk in g a b o u t? H e ’s the best b u s i n e s s c o lu m n is t and r e p o r te r w e ’ve e v e r had at this p a p e r ? ” “ B ig d e a l,” said D a v e . “ H e ’s not m u c h fu n at p arties. H e n e v e r w a n ts to talk a b o u t the old d ay s. A n d he w o r k s so hard h e m a k e s the rest o f us lo o k b a d .” C o y rep lie d , “ I h o p e w e ’re lu c k y e n o u g h to k e e p G re g . A n d I h o p e yo u tw o w ill th in k a b o u t w h a t y o u j u s t said to m e. G r e g ’s w o r k ethic g ot h im th a t g o o d o ffer. A n d n o t w a n tin g to talk a b o u t th in g s th a t h a p p e n e d lo ng b e fo r e he g o t he re d o e s n ’t m a k e h im a b a d g uy . It j u s t m e a n s he w a s n ’t h e re t h e n . ” H is tw o old frie n d s l o o k e d s u r p ris e d an d w a lk e d out. C o y shu t the d o o r to his office. H e th o u g h t a b o u t e v e ry th in g th a t h a p p e n e d today. F o r the first tim e, he really th o u g h t a b o u t h ow his rela tio n sh ip w ith D av e and E d w in m i g h t a p p e a r to the o th e r n e w s r o o m e m p l o y e e s . D a v e and E d w in a l­ w a y s r u s h e d into his office afte r so m e th in g big h a p p e n e d to get the sco op . H e th o u g h t a b o u t h o w and w h y G re g b e c a m e so alien ated , an d h o w A liah m a d e him rea lize h o w o u t o f to uch he w as w ith the local ethn ic c o m m u n it ie s . H e w o n d e re d if A liah and o th e r rep o rters felt alien ated . P e rh a p s the J e w is h fe m a le spo rts r e ­ porter, S arah R o s e n s to n e , felt as G re g did b e c a u s e sh e rarely ta lke d to him either. “ H o w ir o n ic ,” C o y th o u g h t to h im s e l f, “ th at G re g th in k s I ’ve g iv e n D a v e and E d w i n h i g h e r raises and p e r f o r m a n c e e v a lu a tio n s th a n h im . I f G r e g an d the

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o th e r s k n e w h o w s m a ll D a v e an d E d w i n ’s raises w e re o v e r the p a s t 5 y e a rs and h o w m u c h I ’ve had to d e a l w ith th ese g u y s j u s t to g et th e m to w o r k h a lf as m u c h as G re g , A lia h an d S a r a h ! ” H e sa t a bit l o n g e r in sile n ce, a b s o r b in g the d a y ’s e v e n ts . T h e n he g o t up an d said , “W e ll , this old d o g is g o in g to h a v e to learn s o m e n e w tr ic k s.” H e g o t up to talk to G re g a g a in a b o u t the c o u n te r o ffe r .

A S S IG N M E N T S e le c t a m a j o r d a ily n e w s p a p e r in the city w h e r e y o u r u n iv e r s ity is lo c a te d o r in a n e a rb y m a j o r m e t ro p o l it a n area. P re te n d it is the M e t r o p o li s M o r n i n g H e r a ld . C o n d u c t a m a r k e t an a ly s is, d e v e lo p n e w c o n te n t a n d /o r se c tio n (s ) fo r the p a p e r a n d Inte rne t, e v a lu a te legal p ro b l e m s a s s o c ia te d w ith the W e b site, c o n s i d e r ho w to c r o s s - p r o m o t e the p a p e r and I n te rn e t site u sin g the o th e r local M e g a M e d i a o w n e d o utlets, c h a n g e the o rg a n i z a ti o n a l c u ltu re , an d d e v e lo p a n e w p e r f o r ­ m a n c e e v a lu a tio n sy s te m fo r the H era ld . S u c h m a j o r c h a n g e s r e q u i re e x te n s iv e re s e a rc h an d p la n n i n g as w ell as c u l ­ tural c h a n g e s to im p le m e n t. B y c a re f u lly p la n n i n g an d c o n s i d e r in g m a n y fa cto rs b e fo r e th e s e c h a n g e s are im p le m e n te d , the u lt im a te c h a n g e s s h o u ld be e a s i e r to m a n a g e w h e n the p r o c e s s starts. A ls o f o r m u la t e y o u r p la n s to r e a c h M e g a M e d i a ’s o v e ra ll go als: (a) to be the m u l ti m e d i a n e w s le a d e r in M e t ro p o li s ; (b) to u se n e w te c h n o l o g ie s to fo s te r e x c e l le n c e in n e w s an d c r o s s - p r o m o t i o n a m o n g its lo c al o u tle ts , d e v e lo p i n g p a rt n e rs h i p s to sh a r e n e w s c o n te n t an d p r o m o ti o n a l o p p o rt u n it ie s to re ach a b r o a d e r a u d ie n c e in M e t ro p o li s ; (c) to attract th e m a j o r e th n ic c o m m u n i t i e s , n o n re a d e r s , a n d the y o u n g e r a u d ie n c e to the n e w s p a p e r for m o r e in - d e p th c o v e r a g e o f im p o r t a n t lo cal storie s u sin g c r o s s - p r o m o ti o n ; and (d) to u se n ew a p p r o a c h e s and te c h n o l o g ie s to c reate o p e ra t io n a l effic ie n c ie s and in c r e a s e re v e n u e . B e fo re y ou fo r m u la te p la n s , b e g in by c o n d u c ti n g a m a r k e t a n a ly s is fo r the H e r a l d (an d p re t e n d it is the m a j o r p a p e r y o u h a v e sele c te d in a n e a rb y city). M a n y s o u r c e s arc n o te d h e re, b u t ask y o u r p r o f e s s o r a b o u t th ese an d o th e r s o u r c e s to use. F in d o u t the n u m b e r an d ty p e s o f e x is tin g local m e d i a o u tle ts by r e v i e w i n g p u b li c a ti o n s s u c h as the G a le D i r e c t o r y , B r o a d c a s t in g & C a b l e c a s t ­ ing Y e a rb o o k , E d i t o r & P u b l i s h e r M a r k e t G u i d e , an d o th e r s (th ese so u r c e s m a y i n c lu d e d a ta a b o u t y o u r city too). A s k y o u r r e f e re n c e lib rarian fo r h e lp to find th ese o r o th e r p u b li c a ti o n s listing m a j o r m e d i a o u tle ts in y o u r city. If n o th in g else e x is ts, lo o k in the Y e llo w P a g e s. C h e c k o u t the W e b sites o f the o u tle ts in y o u r m a j o r city to see h o w th ey id e n tify and p r o m o te th e m s e lv e s . A lso o b ta in as m u c h in f o rm a t io n as y o u can a b o u t the d e m o g r a p h i c s , p s y c h o ­ g ra p h i c s , an d o th e r c h a ra c t e ri s ti c s o f the c i t y ’s re s id e n ts . If a v a ila b le in y o u r li­ b rary , o b ta in the S R D S L ife s ty le M a r k e t A n a ly s t an d c o p y the d e m o g r a p h i c and lifesty le p a g e s for y o u r city. A n a ly z e the m a j o r d e m o g r a p h i c a n d lifesty le c h a r ­ a c te ris tics o f re s id e n ts . ( T h in k a b o u t w h e t h e r c o n te n t c o u ld be d e v e lo p e d to

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a ttract m a j o r r e a d e r s h ip s e g m e n ts b a s e d on the lifesty le c a te g o rie s w ith large n u m b e r s o f re s id e n ts an d h ig h in d e x e s .) If M e d i a m a r k o r S i m m o n s are av a ila b le in y o u r lib ra ry , c h e c k to see w h e t h e r a r e p o r t on y o u r city is in c lu d e d . W h e n y ou are r e a d y to c o n d u c t a c o m p u t e r se a rc h , yo u an d y o u r cla ss m ig h t s e a r c h to g e t h e r if y o u r c lass is ta u g h t in a c o m p u t e r lab. T h e c lass as a w h o le c o u ld d e v e lo p a c o m p r e h e n s i v e list o f te r m s an d o b je c t iv e s to use in a search . Y o u r p r o f e s s o r c o u ld a ss ig n d if fe re n t s earch te r m s o r o b je c t iv e s to e a c h stu d e n t o r te a m . T h e n th e cla ss c o u ld sh a re all the u sefu l in f o rm a t io n a n d data th ey find w ith e a c h o th e r to m a k e the se a rc h p r o c e s s q u ic k e r an d m o r e efficient. E a c h p e r ­ so n or team c o u ld be re s p o n s ib l e fo r d e v e lo p i n g a list o f u sefu l article s, cites, a n d /o r W e b a d d re s s e s to sh a r e w ith the class. H ere are s o m e sea rc h s trateg ies to try. E n te r the n a m e o f y o u r city an d rele v a n t search term s (s u ch as d e m o g r a p h ic , lifestyle, in c o m e , etc.) to c o n d u c t sea rc h es in e lec tro n ic d a ta b a s e s like A B I I n f o r m / P r o Q u e s t an d L e x is - N e x is . G o to the N e w s library in L e x is - N e x is , c lick on the U.S. N e w s p a p e r s link, select the state w h ere y o u r city is lo cate d , an d c o n d u c t a search there. T h e n s elect the re gio n w h e re y o u r city is lo ca ted and c o n d u c t a n o th e r search . A ls o e n te r the n a m e s o f o th e r m a jo r m e d ia ou tlets in y o u r city to o b ta in g o o d b a c k g r o u n d in f o rm a tio n on c o m p e t it o rs in y o u r m a rk et. C h e c k M e d i a w e e k m a g a z in e b e c a u s e it o c c a sio n a lly p u b lis h e s a r ­ ticles o n v a rio u s T V m a r k e ts aro u n d the c o u n tr y (e.g., see H u d s o n , 2 0 02 ). T h e r e a re a v a rie ty o f o n lin e re s o u r c e s w ith e c o n o m i c and o t h e r data . G o to F e d S ta t s ( w w w . f e d s t a t s . g o v ), c lic k on the M a p S t a ts link, and s e le c t y o u r state and c o u n ty to o b ta in in f o rm a t io n on y o u r city. L o o k fo r e c o n o m i c d a ta at the U .S . D e p a r t m e n t o f L a b o r ’s B u re a u o f L a b o r S tatis tics site (h ttp ://s ta ts .b ls .g o v / ), clic k on R e g io n s , S ta te s, an d A r e a s at a G la n c e , and re v ie w the state data. S c ro ll to th e b o tt o m o f the p a g e to a c c e s s re p o r ts o n m a j o r cities in the state. V isit the U .S . D e p a r t m e n t o f C o m m e r c e B u r e a u o f E c o n o m i c A n a ly s i s ( w w w . b e a . d o c . g o v ), clic k on the state an d lo cal d a ta link, and e x a m i n e data such as the re g io n a l e c o n o m i c p ro files an d p e rs o n a l i n c o m e . C h e c k o u t the o v e rv i e w o f the e c o n o m y link at the b o tto m o f the h o m e p a g e to o b ta in a c u r r e n t s n a p s h o t o f th e U .S . e c o n o m y . I f y o u still n e e d m o r e in f o r m a t io n , g o to the U .S . C e n s u s B u r e a u (w w w . c e n s u s . g o v ) y click on the S e a rc h link, a n d ty p e in the n a m e o f y o u r city. R e v ie w an d p rin t a n y r e l e v a n t tables o r in f o rm a t io n o f interest. H o w e v e r , re a liz e th at s e a r c h in g the C e n s u s W e b site can be ti m e - c o n s u m i n g a n d difficult. A sk y o u r p ro f e s s o r to id e n tify w h a t y o u s h o u ld be lo o k i n g fo r a n d s earch te r m s to use. R e v ie w the In tro d u c tio n to C e n s u s 2 0 0 0 D a ta P ro d u c t s (w w w . c e n s u s . g o v / d m d / w w w / p r o d u c t s . h t m l ) for an o v e rv i e w o f a v a il a b le da ta, an d then re v ie w re l­ e v a n t C e n s u s 2 0 0 0 d a ta (w w w . c e n s u s . g o v / m a i n / w w w / c e n 2 0 0 0 . h t m l ). F in d the D a ta H ig h li g h ts link a n d s elect the state w h e r e y o u r city is lo cate d . R e v ie w and p rin t a n y d a ta re p o r ts o f in terest. T r y th e U .S . C e n s u s B u r e a u ’s S tate an d C o u n ty Q u ic k F a c ts (h t t p : / / q u i c k fa c t s . c e n s u s .g o v ) f o r a d d itio n a l in f o rm a t io n . C li c k on the state w h e r e y o u r city is lo c a te d an d e x a m i n e the m a j o r d a ta r e g a r d in g y o u r

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state as c o m p a r e d w ith the U n ite d S tates as a w h o le . T h e n s e le c t the m a jo r c o u n ty w h e r e th e city is lo c a te d an d v ie w the d ata. D o not fo r g e t to click the link for m o r e d ata sets on y o u r c o u n ty . T h e r e y o u w ill find links fo r d e m o g r a p h ic s , e th n ic c o m p o s it io n , i n c o m e , a n d o th e r s o c i o e c o n o m i c data. N e x t r e v ie w the s a m e da ta fo r all o th e r c o u n ti e s in y o u r city o f in terest, p rin tin g o r d o w n lo a d in g all y o u find h elp fu l. C h e c k out the d e m o g r a p h i c p ro files ( w w w . c e n s u s . g o v /P r e s s R e l e a s e / w w w / 2 0 0 2 / d e m o p r o f i l e s .h t m l ) . F in a lly , y o u m ig h t e x a m i n e the A m e r i ­ ca n C o m m u n i t y S u r v e y data (w w w . c e n s u s . g o v / a c s / w w w / i n d e x . h t m l ) if y o u still n e e d m o r e in f o rm a tio n . O n c e y o u h a v e c o m p l e t e d y o u r r e s e a rc h into y o u r city, c o n s i d e r c o n d u c ti n g a s ea rc h u sin g o n lin e d a ta b a s e s a g ain . T h e r e s e a rc h p r o c e s s h e lp s y ou id e n tify new s ea rc h te r m s to en ter. N o w th a t y o u k n o w w h a t y o u are la c k in g , y o u c a n c o n d u c t a m o r e fo c u s e d d a ta b a s e sea rc h. Y o u w ill also b e c o n fi d e n t th at y o u h a v e e x ­ p lo r e d all y o u r in f o rm a t io n s e a r c h o p ti o n s fully. T h e re is a w ea lth o f in fo rm a tio n a v a ila b le o n lin e to use in d e v e lo p in g new c o n te n t an d c h a n g in g o r g a n iz a tio n a l c ultu re (as w ell as the in f o rm a tio n in variou s c h a p te rs o f this b o o k ). V isit the R e a d e rs h ip Institute ( w w w . r e a d e r s h i p .o r g ) and re v ie w its I m p e ra tiv e s to G r o w R e a d e rs h i p (a d o w n lo a d a b le re p o rt is av ailab le there). T h e s e im p e ra tiv e s in clu d e d e v e lo p i n g ex c e lle n t serv ice, im p ro v in g high p o te n tia l c o n te n t a reas, f o c u s in g on a p a rtic u la r ty p e o f local n e w s, m a k i n g the n e w s p a p e r e a sie r to read and n a v ig a te , im p ro v i n g a d v e rtisin g co n te n t, p ro m o tin g c o n te n t m o r e e ffe c tiv e ly w ith in the n e w s p a p e r, b u ild in g a p o s itiv e b rand relev an t to re ad ers, and d e v e lo p i n g an a d a p tiv e , c o n s tru c tiv e , r e a d e r -c e n te r e d culture. A ls o r e v ie w the H ig h P o te n tia l C o n t e n t A r e a s p a g e an d data ta b le s fo r ideas o n the ty p e s o f c o n te n t to c h a n g e o r ad d ( w w w .r e a d e r s h i p .o r g / c o n t e n t / e d i t o r i a l / h p _ c o n t e n t . h t m , e s p e c i a ll y the c o n te n t are a by age g r o u p ta b le to c o m p a r e sco res for r e a d e r s in d if fe re n t ag e g ro u p s ). B e su re to re a d B ra n d in g : F r o m C o n s u m e r In s ig h t to I m p le m e n ta t io n ; it p r o v i d e s specific s u g g e s tio n s fo r a p p e a l in g to y o u n g e r r e a d e r s (e.g., u sin g u p d a te s , ta lk in g p o in ts, e n r i c h m e n t , an d g u id e s ; at w w w .r e a d e r s h i p . o r g / b r a n d / r e l e v a n c e . h t m ).

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A re a s (w w w . r e a d e r s h i p . o r g / b r a n d / h p _ b r a n d . h t m ) to a n a ly z e b ra n d p e rc e p t io n s b y g e n d e r, ag e, an d e th n ic o rig in . P rin t a n d sav e these tab les as y o u m a y re f e r to th em often d u rin g the project. R e v ie w re le v a n t W e b sites, in c lu d in g th o se d is c u s s e d in the o n li n e re s o u rc e s se ctio n o f c h a p te r 6, to d e v e lo p a p e rs p e c ti v e on the d iv e r s ity a n d cu ltu ral issu es r a ise d in the c ase. V isit the C h e r o k e e N a tio n W e b site (h t t p : / / w w w . c h e r o k e e .o r g ) a n d r e v ie w the in f o rm a t io n th ere on the C h e r o k e e c u ltu re , h is to ry , la n g u a g e , literature, C h e r o k e e P h o e n ix , a n d c la n s (e.g., see w w w . c h e r o k e e . o r g / C u l t u r e / C u lt u r e P a g e .a sp ? ID = 5 3 for in f o rm a t io n a b o u t the A n i w a y a clan ). F r o m c h a p te r 6, r e v ie w links suc h as the U .S. E q u a l O p p o r tu n i ty C o m m i s s i o n ’s fed eral e q u al e m p l o y m e n t la w s ( w w w . e e o c . g o v / q s - e m p l o y e r s . h t m l ) an d the S P J ’s d iv ersity link (w w w . s p j . o r g / d i v e r s i t y .a s p ), as w e ll as the sites o f the N A B J ( w w w . n a b j . o rg ) an d N A J A (w w w . n a j a . o r g ), fo r e x a m p l e .

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Y o u r p r o f e s s o r m ig h t a sk a local n e w s p a p e r p u b lish e r, editor, o r m a n a g e r to visit y o u r class to d is c u ss m a n a g i n g c o n c e rn s like d e v e lo p i n g s y n e r g y a m o n g m e d ia o utlets, p e rs o n n e l and c u ltu re issue s, b u d g e tin g , re s earch , an d d e v e lo p in g n e w p ro jec t p ro p o s a ls. A s k the m a n a g e r to brin g a c o p y o f the n e w s p a p e r ’s o r g a ­ n iz a tio n a l structure. If the c o m p a n y o w n s o th e r m e d ia ou tlets in the s a m e city, try to o btain o r g a n iz a tio n a l c h a rts o f th o s e o utlets as w ell. U se th em as the o r g a n i z a ­ tional structu ral m o d e ls o f the M e t r o p o li s M o r n in g H e r a l d an d its sister outlets. U se the in f o rm a t io n an d d a ta o b ta i n e d fro m all s o u r c e s a n d the tex t to a n s w e r th e f o l lo w in g q u e stio n s: 1. Id e n tify an d d e s c r ib e the m a j o r d iv e rsity is su es th a t e x is t at the p ap er. F o r e x a m p l e , id e n tify the m a j o r c u ltu re s th a t e x is t an d e x p la in w h y they d e v e lo p e d . H o w h a v e d i f fe re n c e s a m o n g m a n a g e r s a n d e m p l o y e e s in g e n ­ d e r an d rac e, as w ell as e th n ic a n d /o r r e lig io u s b a c k g r o u n d , c o n tr ib u t e d to the d e v e l o p m e n t o f th es e c u lt u r e s ? P ro v i d e detail an d e x a m p l e s . R e v ie w ch a p te rs 2 an d 6 b e fo r e a n s w e ri n g . 2. W h a t can yo u do as a m a n a g e r to a v o id fo s te rin g the d e v e l o p m e n t o f s e p a ­ rate c u lt u re s in an o rg a n i z a ti o n ? R e v ie w c h a p te rs 1, 2, 3, 4, an d 6 b e fo r e a n s w e ri n g . A ls o re v ie w y o u r a n s w e r to q u e s tio n 1 b e fo r e c o m p l e ti n g this a n s w e r. T h e n c o n s i d e r w h e t h e r an d h o w y o u r o w n g e n d e r, race, ethn ic b a c k g r o u n d , a n d /o r r e lig io u s or a th e istic b e lie fs m a y h a v e a ffe c te d y o u r a n s w e r to q u e s t io n 1. In o t h e r w o r d s , d o y o u r o w n e x p e r i e n c e s an d b a c k ­ g r o u n d a ffect y o u r p e r c e p t io n s ? If y es, h o w ? F in a lly , afte r re a d in g the re l e v a n t c h a p te r s

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q u e s tio n by d e s c r ib in g w h a t ca n y ou do w h e n yo u are a m a n a g e r (such as C o y ) to a v o id fo s te rin g the d e v e l o p m e n t o f se p a r a te c u lt u re s in an o rg a n iz a tio n . 3. Id e n tify an d d e s c r ib e C o y ’s le a d e rs h i p style. W h a t is p o s itiv e a b o u t the w a y he le a d s ? W h a t is n e g a tiv e a b o u t the w a y he le a d s ? W h a t d id C o y do th a t led to the p r o b l e m s he is fa c in g n o w ? R e v ie w c h a p te rs 1, 2, 3, an d 4 b e fo r e a n s w e rin g . 4. W h a t ste p s s h o u l d C o y tak e to so lv e the c u ltu ra l an d o th e r p e r s o n n e l p r o b ­ le m s in the n e w s r o o m ? W h y ? Is an y o r g a n i z a ti o n a l re s tru c tu rin g n e e d e d ? W h y ? R e v ie w c h a p te r s 1, 2, 3, and 4 b e fo r e a n s w e ri n g . 5. D esig n a n e w p e r f o r m a n c e e v a lu a tio n sy s te m fo r the p a p e r. C o n s i d e r all the p ro b l e m s C o y is fa c in g . Be sure to a d d re s s the is su es C o y is d e a lin g w ith fairly an d e q u ita b ly . R e v ie w c h a p te r 6 a n d the A m e r i c a n A rb itra tio n A s s o c i a t i o n ’s (w w w .a d r .o g r ) W e b site b e fo r e a n s w e ri n g this q u e stio n . A lso rev ie w so u r c e s like the U .S. E q u al O p p o rtu n ity C o m m i s s i o n ’s (w w w . e e o c . g o v ) q u ic k start link (w w w . e e o c .g o v / q s - e m p lo y e r s . h tm l) ', its lin k for law s, r e g u l a ti o n s , and p o lic y g u id a n c e (w w w .e e o c . g o v / p o l i c y / i n d e x . h t m l ); and the S P J ’s d iv e rsity link (w w w . s p j . o r g / d i v e r s i t y .a s p ) b e fo r e c o m p l e ti n g y o u r a n sw e r.

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6. C o n d u c t a m a r k e t a n a ly s is o f M e t r o p o li s (e.g., the m a j o r c ity yo u s e ­ lected). R e v ie w c h a p te rs 7, 8, an d 9 b efo re a n s w e r i n g . U se the i n f o r m a ­ tion in th o s e c h a p te r s as a g u id e fo r w h a t to in c lu d e in y o u r m a r k e t an aly sis. 7. D e v e lo p a c o n te n t p r o p o s a l fo r the p a p e r and In tern et. I d e n tify th e ty p es o f se c tio n s , fe a tu re s, sto ries, c o lu m n s , a n d /o r p e rs o n a litie s to includ e. If p o s s ib le , p r o v i d e a p re l im in a r y b u d g e t. R e v ie w c h a p te rs 5, 6, 7, 8, 9, and 10 b e fo r e a n s w e r i n g . A lso r e v ie w the R e a d e r s h i p I n s tit u te ’s (w w w . r e a d e r s h i p .o r g ) Im p e r a t iv e s to G ro w R e a d e rs h i p . 8. D e v e lo p le g a l g u id e l in e s fo r the W e b site to d e a l w ith an y o b s c e n e o r o b ­ je c t io n a b l e m a te ria l. A ls o d e v e lo p g u id e l in e s fo r p ro t e c ti n g the In te rn et site a g a in s t libel, sla n d e r, o r p ri v a c y actio n s. In c lu d e a c o m p l a i n t p r o c e ­ d u re fo r e m p l o y e e s to use w h e n c o m p l a in t s o c c u r a b o u t c o n te n t on the In te rn e t site. R e v ie w c h a p te rs 5 an d 6 b e fo r e a n s w e r i n g this q u e stio n . C h e c k o u t the In te rn e t A d v e r ti s in g B u r e a u ’s (I A B ) p riv a c y link th at in ­ c lu d e s

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h tm l). If a v a ila b le , also r e v ie w D e lta a n d M a t s u u r a (2 0 0 2 ). (D e lta and M a t s u u r a [2 002J i n c l u d e d a p p e n d ix e s w ith a d v ic e on h a n d li n g a variety o f In te rn e t leg al c o n c e r n s for m a n a g e r s , su ch as G u id e li n e s fo r H a n d lin g P e rs o n a l D a ta [p. A p p . 1-1], E le c tro n ic R e c o r d s M a n a g e m e n t C h e c k li s t [p. A p p . 2-1 ], N e t w o r k U s e an d S e c u rity G u id e li n e s [p. A p p . 3-1], W e b S ite N o tic e / D i s c l a im e r C h e c k l i s t [p. A p p . 4 -1 ], C h e c k li s t fo r L in k L i ­ c e n s e s [p. A p p . 5 -1], W o r l d W id e W e b Site D e v e l o p m e n t A g r e e m e n t Ip. A p p . 6-1], M o d e l E le c t ro n ic D a ta In te r c h a n g e T r a d in g P a rt n e r A g r e e ­ m e n t an d C o m m e n t a r y [p. A p p . 7 -1 ], E - C o m m e r c e B u s in e s s P ra c tic e G u id e li n e s

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Ip. A p p . 14-1].) 9. D e v e lo p a re s e a rc h p r o p o s a l to find o u t w h e t h e r the n e w n e w s p a p e r and I n te rn e t c o n te n t w ill be p o p u la r w ith the d e s ire d r e a d e r s b e fo r e an d after it is in tro d u c e d . E v a lu a t e r e a d e r re a c tio n s to the c o n te n t b e fo r e it is in tro d u c e d to the g e n e ra l p u b lic , as w ell as the su c c e s s o f the p ro p o s e d n ew c o n te n t a fte r its in tro d u c tio n . In o th e r w o rd s , d e v e lo p a res ea rch p lan fo r e v a lu a tin g the n ew c o n te n t b e fo re it is m a d e av a ila b le to the g e n ­ eral p u b lic in the n e w s p a p e r an d Internet. A ls o d e v e lo p a re s e a rc h p r o ­ p o s a l to g a u g e re a c tio n to the n e w c o n te n t afte r it ap p e a rs . B e sure to d e v e lo p a re s e a rc h p lan that h e lp s the p a p e r a d ju s t the c o n te n t, if n e e d e d , a fte r it is in tro d u c e d . R e v ie w c h a p te rs 5 and 9 b e fo r e a n s w e r i n g this q u e stio n . 10. O n c e the n e w c o n te n t is se le c te d , w h a t is the b e st w a y to c r o s s - p r o m o te it a m o n g the n e w s p a p e r , T V s ta tio n , ra d io sta tio n s, and I n te rn e t? W h a t

296

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sho uld M e g a M e d i a ’s b ran d identity a n d the po sitio n o f the n e w s p a p e r be and w h y ? E x p la in y o u r a n s w e r in as m u c h detail as p o ss ib le. R e v ie w c h a p te rs 8 an d 9 b efo re a n s w e rin g . F o r m o r e in f o rm a tio n a b o u t Internet a d v e rtisin g , re v ie w the I A B ’s site ( w w w .i a b .n e t), in c lu d in g the diffe ren t ty p es o f in teractiv e a d v e rtisin g units ( w w w .i a b .n e t/ ia b _ b a n n e r _ s ta n d a r d s / b a n n e r s o u r c e .h tm l) . T h e tab les in c h a p te r 9 in clu de a v ariety o f o th e r links to use fo r in fo rm a tio n on d if fe re n t ty p es o f a d v e rtisin g an d p ro m o tio n . 11. W h a t w o u ld be the b est d e c i s io n - m a k in g p ro c e s s to d e v e lo p the p ro p o s e d n e w c o n te n t o n c e it is iden tified th r o u g h the m a r k e t a n a ly s is a n d r e ­ s e a r c h ? S h o u ld C o y m a k e this d e c is io n a lo n e ? S h o u ld this be a g r o u p d e ­ c is io n ? W h o s h o u l d b e in v o l v e d ? W h y ? E x p la i n y o u r a n s w e r in detail. R e v ie w c h a p te rs 1, 2, 3, 4, an d 5 b e fo r e a n s w e rin g . 12. W h a t w o u ld be the b e st d e c i s io n - m a k in g p ro c e s s fo r C o y to use w h en m a k i n g a s s ig n m e n t s on w h o is to c o v e r w h a t n ew c o n te n t ? In o th e r w o rd s , s h o u ld C o y c h a n g e his d e c is io n - m a k in g sty le? W h y ? H o w ? E x ­ p lain y o u r a n s w e r. R e v ie w c h a p te r s 1, 2, 3, 4, an d 5 b e fo r e a n s w e ri n g . 13. O n c e the n ew c o n te n t fo r th e p a p e r an d In te rn e t is se le c te d , s h o u l d the n e w s r o o m o r o t h e r d e p a r t m e n t s be re o r g a n iz e d , o r n e w d e p a r t m e n t s a d d e d , to h a n d le the n e w a s s ig n m e n t s ? S h o u ld a n y ne w n e w s r o o m m a n ­ a g e ria l p o s itio n s be d e v e lo p e d ? If yes, w h o s h o u ld be p r o m o t e d ? W h y ? S u g g e s t o r g a n i z a ti o n a l c h a n g e s to m a k e im p le m e n ta t io n o f the c o n te n t an d p r o m o ti o n a l p la n s easier. R e v ie w c h a p te rs 4 an d 5 b e fo r e a n s w e ri n g . 14. D e v e lo p a plan to i m p le m e n t the in tro d u c tio n o f the n ew c o n te n t. D e ­ v e lo p steps, ti m e t a b le , a lte rn a tiv e s, and so on to s h o w h o w a n d w h e n the n e w s e c tio n w ill be in tro d u c e d . If p o ss ib le , d e v e lo p a p re l im in a r y b u d g e t. Id e n tify ste p s in s u c c e s s io n to s h o w w h a t m u s t be d o n e to e n su r e that the s e c tio n is in t r o d u c e d as p la n n e d . R e v ie w c h a p te r s 7 an d 10 b e fo r e a n s w e rin g .

Extended Case 2 The Case of the New sro o m Restructuring

C h a r le n e G ra y , p re s id e n t o f N o r th e a s t W o r l d N e tw o r k ( N W N ) , le a n e d b ack in h e r c h a ir a n d s tared g ri m l y at the tw o m e n on the o t h e r side o f th e table. Bill L ig o n , vice p re s id e n t o f N e w s , an d T e r r y R u ssell, vice p r e s id e n t o f O p e ra ti o n s , stared back . T h e r e w a s no g o o d n e w s a n y w h e r e in the piles o f the p a p e r s ca ttered a c ro s s the table b e tw e e n the th re e o f them . “ T h is is g o in g to be u g ly ,” G r a y said. “ I t ’s g o in g to m e a n lay o ffs. L o ts o f l a y ­ o ff s .” B o th m e n s lo w ly n o d d e d a g re e m e n t. N W N w a s a 2 4 /7 r e g io n a l c a b le n e w s n e tw o r k s e r v in g the n o rt h e a s t U n ite d S tates. It h ad started as a fa m il y - o w n e d i n d e p e n d e n t statio n. In the early 1990s, th e o w n e r s h a d s w it c h e d the station to an a ll-n e w s fo r m a t th at b e c a m e k n o w n for f e a tu rin g a few lo n g e r, m o r e th o u g h t fu l sto rie s e v e ry h o u r. N W N ’s style w a s

E X T E N D E D CASE ST UDI E S

297

m o r e like th a t o f th e B B C th an the fast, flashy a p p r o a c h ty p ic a lly u se d by U .S. T V n e w s , b u t the statio n h a d f o u n d an a u d ie n c e an d, as its ra tin g s an d re p u ta tio n g re w , c a b le s y s te m o p e ra t o rs to o k n otice. E v e n tu a l ly , it w a s re i n v e n te d as a r e ­ g io n a l c a b le n e w s n e tw o r k th at f o c u s e d on sto ries o f in te re st to a u d ie n c e s in the M a i n e - W a s h i n g t o n , D C c o rrid o r. T w o y e a rs ag o, the f a m ily tha t o w n e d N W N so ld it to a m a j o r p u b li c ly held m e d ia c o rp o r a ti o n , O u tlo o k M e d ia . O u tlo o k w a s on an a c q u is itio n sp re e, an d its top m a n a g e m e n t w a s u n d e r p re s s u re fro m W a ll S tree t to im p r o v e e a rn i n g s . L ast w e e k , O u t l o o k ’s C h i e f F in a n c i a l O ffic e r h a d visite d N W N an d told G ra y she had to d ra s tic a lly in c re a se N W N ’s o p e r a t in g profit m a r g in n e x t y ear. G ra y , L ig o n , a n d R u s s e ll h a d s p e n t the p a s t w e e k try in g to d e v is e a w a y to do that. T h e a n ­ s w e r w a s clear: c u t j o b s , in c l u d in g 120 p o s itio n s fro m th e n e w s r o o m . “ W e h a v e sev eral p r o b l e m s , ” G ra y said. W e ’v e g o t to c u t e n o u g h j o b s to hit th e n u m b e r s th a t O u t l o o k h a s g i v e n us. B u t w e w o n ’t be a b l e to c o n t i n u e to p r o d u c e n e w s th e w a y w e ’v e b e e n d o i n g it w i t h a m u c h s m a l l e r staff. S o w e ' l l a l s o h a v e to r e s t r u c t u r e o u r n e w s p r o d u c t so th a t it r e ­ q u i r e s f e w e r p e o p l e to p r o d u c e . F i n a l l y , w e h a v e to m a n a g e this o r g a n i z a t i o n t h r o u g h th e s e c h a n g e s in s u c h a w a y t h a t o u r e n t i r e s t a f f d o e s n ’t q uit.

“ T h a t ’s a real c o n c e r n , ” R u s s e ll r e s p o n d e d . A t m y las t j o b , w e r e s t r u c t u r e d o u r o p e r a t i o n s , tr y in g to r e d e s i g n j o b s in th e n e w s ­ r o o m so th a t e v e r y o n e w a s m u l t i - t a s k i n g a c r o s s j o b s an d m e d i a . F o r e x a m p l e , w e w a n t e d o u r T V p r o d u c e r s to b e a b l e to p r o d u c e b r o a d c a s t s t o r i e s a n d t h e n r e -e d it t h e m f o r th e n e w s p a p e r a n d W e b . A t th e s a m e t i m e w e h a d to b u y n e w p r o d u c t i o n s y s t e m s to s u p p o r t th e r e s t r u c t u r i n g so e v e r y o n e h a d to le a r n to u s e n e w e q u i p ­ m e n t . W e t h o u g h t w e w o u l d b e m o r e ef fic ie n t, b u t it w a s a d i s a s t e r . M o r a l e d i s i n t e ­ g r a t e d . T h e s t a f f b e c a m e o p e n l y h o s t i l e to m a n a g e m e n t , a n d p e o p l e q u i t in d r o v e s . B y th e t i m e it w a s o v e r , w e h a d l o st m o s t o f o u r b e s t p e o p l e , a n d it h a d b e c o m e a v e r y u n p l e a s a n t p l a c e to w o r k .

G ra y a n d L ig o n b oth n o d d e d . “ I ’ve h a d s i m i la r e x p e r i e n c e s ,” G r a y said. “T h e m o s t i m p o r t a n t re a s o n p e o p le seek c a re e r s in j o u r n a li s m is the d e s ire fo r a c h a n g e a b l e , n o n - r o u tin e j o b * . B u t i t ’s o n e th in g to w a n t v a rie ty in y o u r w o rk , and a n o th e r th in g to a c c e p t c h a n g e s in y o u r jo b . J o u r n a lis ts are h u m a n . T h e y d o n ’t a d a p t w e ll.” “ B u t th e re are still s o m e th in g s yo u can d o to try to m a n a g e the p r o c e s s ,” L ig o n n oted . “ It d o e s n ’t m e a n th at it w ill be e a s y , b u t it m i g h t m a k e it easie r. 1 w e n t to a s e m in a r on m a n a g i n g o rg a n i z a ti o n a l c h a n g e last year. W e lo o k e d at a lot o f re s e a rc h th at s u g g e s ts s o m e a p p r o a c h e s that m a y h e lp .” “ F o r e x a m p l e ? ” G ra y aske d. W e l l , first, r e s e a r c h on c h a n g e m a n a g e m e n t in n e w s r o o m s s h o w s j o u r n a l i s t s will m o s t r e s e n t t h o s e c h a n g e s t h e y th in k h u r t t h e i r a b i l i t y to m e e t h i g h p r o f e s s i o n a l j o u r n a l i s t i c s t a n d a r d s f o r q u a l i t y ( B e r g e n & W e a v e r , 1 98 8; S t a m m & U n d e r w o o d ,

* S ee ack n o w led g m en ts p. 300.

2 98

EXTENDED CASE STUDIES

1 993; P o lla rd , 1995). S o, as w e r e s tru c t u re o u r n e w s p ro d u c t , w e can e x p e c t to m e e t the m o s t re s is t a n c e — a n d g e n e r a t e the m o s t m o r a le p r o b l e m s — w ith c h a n g e s th e s t a f f th in k s are g o in g to lo w e r the q u a lity o f w h a t w e ’re do in g .

Gray nodded. “W hat else?” S e v e ra l th in g s. P ro v i d in g c o n ti n u o u s i n f o r m a t io n and c o m m u n i c a t i o n a b o u t the p r o p o s e d c h a n g e s , the p r o c e s s e s to be u se d to m a k e th e m , and the e x p e c t e d o u t ­ c o m e s i m p r o v e s e m p l o y e e s ’ o p e n n e s s to c h a n g e an d th e ir j o b s a tisf a c tio n , a n d r e ­ d u c e s th e ir lik e lih o o d to q u it ( N a d le r , 1987; M i ll e r & M o n g e , 1 985; W a n b e r g & B a n a s , 2 0 0 0 ). S o d o e s g iv in g th e m the c h a n c e to h a v e in p u t into the p ro c e s s ( C u m ­ m i n g s & W o r l e y , 1993). P artic u la rly i m p o r t a n t is to try to h e lp s t a f f see the c o n ­ n ec tio n b e tw e e n the c h a n g e s w e ’re m a k i n g a n d th e o r g a n i z a t i o n ’s lo n g - te rm n e e d s an d g o a ls . ( B e c k h a r d & H a rris, 1987)

“ O f c o u r s e , ” L i g o n a d d e d wr yly, w e s h o u l d n ’t e x p e c t th e m to feel in s p ired by the g o al o f b o o s t in g the c o m p a n y ’s o p e ra tin g profit m a r g in s . S o w h e n w e re s tru c tu re , w e ne ed to th in k b e y o n d fin a n ­ cial o u t c o m e s a n d see this as an o p p o r t u n it y to d e v e lo p n e w w a y s to im p r o v e the q u a lity o f o u r n e w s a n d p u b lic se rv ic e . If w e c a n d o that a n d fo c u s o u r d is c u s s i o n s o f h o w the c h a n g e s will h e lp us m e e t th o s e g o a ls , w e 'l l h a v e b e tte r su c c e s s m a n a g ­ in g th is p ro c e s s.

“ A n y t h i n g else w e s h o u ld be c o n s i d e r i n g ? ” R u ss e ll asked. “ Yes. O l d e r st af f m e m b e r s arc m o r e likely to resist c h an g e , b ut t h e y ’re also less likely than y o u n g e r e m p l o y e e s to act ual ly qui t ( D a ni e l s & Hollificld, 2 002) . O f c ou r se , that m e a n s y o u c an w i n d up wi th p eo pl e w h o w o u l d like to leave but c a n ’t b e c a u s e o f p e r s on a l r e a s o n s , ” L i g o n said. S tu d ie s a ls o sh o w th at the m o s t re s iste d c h a n g e s are, in ra n k o rd e r , th o s e see n as h u rtin g the q u a lity o f the n e w s p ro d u c t , la y o f fs, c h a n g e s in p r o d u c t io n te c h n o l o g ie s a n d s y s te m s , a n d c h a n g e s in p ro d u c tio n p r o c e s s e s . R e s e a r c h also s u g g e s ts th a t no m a t te r w h a t y o u d o, p e o p le are u n h a p p y w ith c h a n g e , m o s t c o n s i d e r q u ittin g in r e ­ s p o n s e to it, an d they b la m e th e ir m a n a g e r s for w h a t ’s h a p p e n in g m o r e than they b la m e the c o m p a n y — e v e n th o u g h the c o m p a n y o r d e r e d the c h a n g e s . W e a lso can e x p e c t th ere to b e s t a f f tu r n o v e r a ft e r w a r d s , e v e n a m o n g th o s e n o t r e le a s e d . T h e g o o d n e w s is th a t the attitu d e s o f the p e o p le w h o stay w il l i m p r o v e o v e r tim e , but d e s p i te that, th e y still w ill p e r c e i v e the c h a n g e p ro c e s s as h a v in g b e e n n e g a tiv e and b e lie v e th e y w e r e h a p p ie r b e fo r e a n y o f it h a p p e n e d . ( D a n ie l s & H o llifield . 2 0 0 2 )

G r a y si ghed. In o th e r w o r d s , w e c an e x p e c t a lot o f u n h a p p in e s s a n d r e s is ta n c e n o m a t te r w h a t w e d o . B u t d e s p ite that, w e ’re g o in g to d o o u r b e s t to h a n d le this w ell. In m y p r e v i ­ o u s jo b , w e w e n t th r o u g h la yo ffs. It w a s d o n e strictly on the b a sis o f sen io rity , w h ic h is ju s tifia b le at o n e level b u t c re a te s a lot o f p r o b l e m s in o th e r w a y s . T h e p ro c e s s u se d to h a n d le the la y o ffs w a s b rutal. M a n a g e m e n t c a lle d p e o p le in o n e b y - o n e to g iv e th e m n otic e. E v e r y o n e in the n e w s r o o m saw w h o w a s b e in g s u m ­ m o n e d . P e o p le w a lk e d o u t o f th o s e m e e t in g s s o b b i n g in fro n t o f e v e r y o n e and w e re

EXTENDED CASE STUDI ES

299

e s c o rt e d d irectly to the front d o o r w ith no id ea w h a t they w o u l d d o n ex t o r how' they w o u l d find a n o t h e r j o b . T h a t is not g o i n g to h a p p e n here. T h is m a y be an ugly p r o c e s s , b u t w e can find a h u m a n i t a r ia n w a y to h a n d l e it!

ASSIG NMENT Y ou are con su ltants bro ug ht in by G ray and N W N to help d evelo p a plan for re­ structuring their n ew s operations. Y o u h a v e three tasks: 1. D e v e lo p a vision for a new ap p ro ach to p ro d u cin g a high -q uality 24/7 n ew s pro g ram that requires 120 few e r staff m e m b e rs than N W N currently uses. Be prep ared to justify y o u r p ro po sed redesign and explain to staff m e m b e rs how it will reflect— or even im p ro v e o n — their stand ards for jou rn alistic quality and public service. 2. D ev elo p a specific and detailed plan for c o m m u n ic a tin g the c h a n g e s to the staff. U se w h at L igo n reported ab ou t successful c h a n g e m a n ag e m en t. W h e n will you begin in form in g staff? W h a t will y o u r specific m essag es be? H o w will they be c o m m u n ic a te d ? W h o will c o m m u n ic a te them ? If you bring staff m e m b e rs into the decision p ro cess, w h o m will you bring in, w h en, and w h y ? W h a t decision s will you allow them to share in m a k ­ ing? W h o will you leave out o f the decision p ro cess and w h y ? W h a t p ro cesses will you create for staff input? H o w will you deal w ith p roposals from the staff that you do not think will w o rk or th at you do not like? H o w will you deal with staff m e m b e rs w h o b e c o m e op en ly hostile and try to o r­ g anize resistance? W h e n in the c h a n g e -m a n a g e m e n t process will you put y o u r plan into o p eration? A fter you h ave d e v elo p e d at least part o f a c o n ­ crete plan for the ch a n g e s? O r b efore y ou even start? W h e n will y o u r plan en d? R igh t after the la yoffs? W h e n the n e w sc a st redesign is finished? At so m e period fo llo w ing the point at w h ich you are no lo ng er im p lem en tin g c h a n g e s? A g a in , y o u r c o m m u n ic a tio n and ch an g e m a n a g e m e n t plan must be very detailed and specific. 3. D evelop a termination plan for the layoffs. H ow can you m inim ize the p o ­ tential legal ramifications that m ay result? How will those laid o ff be in­ form ed? W h o handles that process and how will it be d o ne? W h e n will they be told in relationship to the beginning/end o f the restructuring and the ac­ tual date when their jo b s will end? W hat are the pros and cons o f terminating people im m ediately or having their final day fall som etim e after they have been notified? H ow will you handle the problem s that result from the option you choose for notification/termination process? W h a t will the severance package be? W h a t oth er support o r assistance, if any, will you offer those you are letting go? H ow will you inform the people w h o will not be laid off about the layoffs and about w ho is being term inated? G iven the resentm ent that layoffs generate am on g those w h o keep their job s, w hat is yo ur proposal

300

E X T E N D E D CASE S T U D I E S

TABLE C.1 N W N ' s C u rre n t Newscast Design per H o u r of Prog ram m in g on Average Ty p e o f S tory

In-depth

L e n g th

N o. p e r

F T E S ta ff

(m in )

W eek

R equirem ents'

5

35

70

1 :3 0

195

13 0

3 0 se c

400

50

in v e stig ativ e or analytical N ew s package stories R eader, voiceover w /video G eneral new sroom

902

o p eratio n s and support T otal sta ff

340

1 FTE m ea n s the num ber o f fu ll-tim e e q u iv a len t s ta ff m em b ers required to pro­ d u ce that typ e o f n e w s story in the qu antity used each w e ek . ’ In clu d es m a n a g em en t team , a n ch o rs, d irectors, stu d io cam era operators, te c h ­ n ic ia n s, and a ssig n m e n t ed ito rs. O f the 9 0 p o sitio n s. 5 0 m u st rem ain for the n et­ w ork to be on the air. T he rem ainder is produ ction a ssistan ts, w riters, c le ric a l sta ff, and other support p erso n n el. Y et at lea st so m e o f th ese p o sitio n s m ust be re­ tained to m aintain o p era tio n s.

fo r m a n a g i n g the r e m a i n i n g s t a f f t h r o u g h the s e p a r a tio n a n d g r i e f p r o c e s s ? Y o u r p r o p o s a l m u s t be d e ta i le d , rea listic , a n d le g a lly a c c e p t a b le .

ACKNOW LEDGMENTS T h e a u t h o r g r a t e f u l l y a c k n o w l e d g e s th e a s s i s t a n c e o f G e o r g e D a n i e l s , D r. L e e B. B e c k e r , a n d M r . R o b e r t F u r n a d w ith th e d e v e l o p m e n t o f th is c a s e . ♦ U n p u b l i s h e d d a t a f r o m th e 1 9 98 a n d 19 9 9 A n n u a l S u r v e y o f J o u r n a l i s m & M a s s C o m m u n i c a t i o n G r a d u a t e s , c o n d u c t e d b y D r. L e e B e c k e r a n d th e J a m e s M . C o x , Jr. C e n t e r fo r I n t e r n a t io n a l M a s s C o m m u n i c a t i o n T r a i n i n g a n d R e s e a r c h a t th e U n i v e r s i t y o f G e o r g i a .

R

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S o ciety .

lO n l i n e J .

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9 3 -2 9 0 . W a s h i n g t o n , D C : U .S . G o v e r m e n t P rin tin g O ffice. U .S . H o u s e o f R e p r e s e n t a ti v e s C o m m i t t e e on G o v e r n m e n t O p e r a ti o n s . ( 1 9 8 0 ) . I n t e r n a ­ tio n a I in fo r m a tio n

o w : F o r g in g a n e w f r a m e w o r k . W a s h i n g t o n , D C : U .S . G o v e r n ­

m e n t P rin tin g Office. U .S . H o u s e o f R e p r e s e n t a ti v e s C o m m i t t e e o n G o v e r n m e n t O p e r a ti o n s . ( 1 9 8 1 a ) . I n t e r n a ­ t io n a l C o m m u n i c a t i o n s R e o r g a n iz a ti o n A c t o f 1 9 8 1. W a s h i n g t o n , D C : U .S. G o v e r n ­ m e n t P rin tin g O ffice. U .S. H o u se o f R e p re s e n ta tiv e s S u b c o m m it te e on T e le c o m m u n i c a ti o n s , C o n s u m e r P ro te c ­ tion, an d F in a n c e o f the C o m m it te e on E n e rg y an d C o m m e r c e . (1 9 81 b). T e l e c o m m u n i ­ c a tio n s a n d in fo rm a tio n p r o d u c t s a n d s er vic es in in tern a tio n a l trad e (S erial N o. 97-59 ). W a s h i n g t o n , D C : U .S. G o v e r n m e n t P rin tin g O ffice. V a n M a a n e n , J., & B a rle y , S .R . (1 9 8 4 ). O c c u p a ti o n a l c o m m u n i t i e s : C u lt u r e an d c o n tr o l in o rg a n i z a ti o n s . In B .M . S taw & L .L . C u m m i n g s (E d s.), R e s e a r c h in o r g a n i z a t i o n a l b e h a v i o r (pp. 2 8 7 - 3 6 5 ) . G r e e n w i c h , C T : J A I P ress. V r o o m , V .H . ( 1 9 6 4 ) . W o r k a n d m o tiv a t io n . N e w Y o rk : W il e y . V r o o m , V .H ., & Y e tto n , P .W . (1 9 7 3 ). L e a d e r s h i p a n d d e c is io n m a k in g . P itts b u rg : U n i­ v ersity o f P itts b u rg P ress. W a n b e r g , C .R .. & B a n a s , J.T . ( 2 0 0 0 ) . P r e d i c to rs a n d o u t c o m e s o f o p e n n e s s to c h a n g e s in a re o r g a n iz i n g w o r k p la c e . J o u r n a l o f A p p l i e d P s y c h o lo g y , 8 5 . 1 3 2 - 1 4 2 . W a n g , K. (2 0 0 2 , J u n e 2 4 - J u l y 1). P e o p le m e t e r sta n d o ff. E l e c t r o n ic M e d i a , 2 7 (2 5 ) , 3, 29. W a r n e r , C. ( 1 9 9 7 ) . C o m p e n s a t i n g b r o a d c a s t s a le s p e o p le : S o m e r e c o m m e n d a t i o n s . In C. W a r n e r (E d .), M e d i a m a n a g e m e n t r e v ie w (pp. 1 5 7 - 1 7 6 ) . M a h w a h , N J: L a w r e n c e E r lb a u m A s s o c ia te s. W e a v e r , D .H ., & W il h o it , G .C . ( 1 9 9 6 ) . T h e A m e r i c a n j o u r n a l i s t in the 199 0s: U.S. n e w s p e o p l e a t the e n d o f a n era. M a h w a h , N J: L a w r e n c e E r lb a u m A s s o c ia te s . W e a v e r , J. ( 2 0 0 0 ) . O r la n d o : V a lu e s are c e n tr a l to c o n v e r g e n c e s tra teg y . In D .A . Z e e c k ( E d .), E x t e n d i n g the b r a n d (pp. 2 2 - 2 5 ) . R e s to n , V A : A m e r i c a n S o c ie ty o f N e w s p a p e r E d ito rs. W e b e r , M . (1 9 4 7 ). T he th e o r y o f e c o n o m i c a n d s o c i a l o r g a n i z a ti o n ( A .M . H e n d e r s o n & T . P a rs o n s , T ra n s .) . N e w Y o rk : F re e P re s s. ( O rig in a l w o r k p u b li s h e d 1921.) W h it in g , C .S . (1 9 9 5 , O c to b e r ) . O p e r a ti o n a l t e c h n i q u e s a n d c re a tiv e th in k in g . A d v a n c e d M a n a g e m e n t , pp. 2 4 - 3 0 . W il h o it , G .C ., & W e a v e r . D. ( 1 9 9 4 , A u g u s t) . U.S. j o u r n a l i s t s a t w ork, 1971 19 92 . P a p e r p r e s e n te d at the m e e t in g o f th e A s s o c i a tio n fo r E d u c a ti o n in J o u r n a lis m and M a s s C o m m u n i c a t i o n , A tla n ta , G A . W il li a m s , F., & M o n g e , P. ( 2 0 0 1 ) . R e a s o n i n g with s ta tistic s: H o w to r e a d q u a n ti ta t iv e r e s e a r c h (5th ed .). F o rt W o r t h , T X : H a rc o u rt. W i m m e r , R ., & D o m i n i c k , J. ( 2 0 0 3 ) . M a s s m e d ia r e s e a r c h (7th ed .). B e l m o n t , C A : W adsw orth. W i t c o v e r , J. (1 9 7 1 , S e p t e m b e r / O c t o b e r ) . T w o w e e k s th at s h o o k the press. C o lu m b ia J o u r n a l is m R e v i e w , pp. 7 - 1 5 . W o lferm an,

E.

(2001, June

18).

Its “ P e rf e c t s t o r m . ” E d i t o r

& P u b l i s h e r , o n lin e

h tt p :/ /w w w . e d i t o r a n d p u b l i s h e r . c o m W rite r s a n d E d ito rs. ( 2 0 0 1 - 2 0 0 2 ) . O c c u p a tio n O p p o r tu n i ti e s Q u a r te r ly : U.S. B u r e a u o f S ta t is ti c s , pp. 1 4 5 - 1 4 8 .

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Y o v o v ic h , B.G . (20 00 , M a y 18). W e b trend w atch. E d ito r and P u blisher, h tt p ://w w w .ju p .c o m Z a c h a r y , M . (2 0 0 0 , A u g u s t) . P e r f o r m a n c e e v a lu a tio n s tr ig g e r m a n y la w su its. S u p e r v is io n , 6 / ( 8 ) , pp. 2 3 - 2 6 . Z a v o in a , S., & R c ic h c r t. T. ( 2 0 0 0 ) . “ M e d i a c o n v e r g e n c e / m a n a g e m e n t c h a n g e : T h e e v o l v ­ in g w o rk flo w f o r v is u a l j o u r n a l i s t s .” T h e J o u r n a l o f M e d i a E c o n o m i c s 1 3 (2 ), 1 4 3 - 1 5 1 . Z ip p , F. (2 0 0 2 , J a n u a r y - F e b r u a r y ) . C a s e stu d ie s fro m a diffic ult y e a r fo r F O l . T h e A m e r i ­ ca n E d ito r . < h tt p :/ / w w w . a s n e .o r g / i n d e x . c f m 7 i d = 3601 > .

A

a

A a k c r . D. A . , 198, 20 3 A c c o l a , J., 2 1 7 , 2 2 1 . 224 A d a m s . J. S.. 54

uthor

In d

ex

B o u l d i n g , M .. 125 B r a m l e t t - S o l o m o n . S.. 57 . 63 B r a u s , P., 65 B rief. A . P., 64 B r o w n . C ., 102 B r o w n , D ., 58 B r o w n . K. F.. 90

A d a m s . P., 64 A d a m s , R. C .. 6 7 . 8 5 , 188 A d a m s . W . J.

B r o w n , M . E ., 35 B r o w n . S. L.. 1 1 1, 1 12

A k h a r a n a - M a j i d , R.. 75 A l b a r r a n . A . B., 109, 187 A l d a g . R. J.. 64

B r o u s s a r d . E. J.. 64 B r o u s s e a u , K. R., 13 B u c h a n a n . D. A ., 101

A l d c r f c r . C. P., 52, 56 A lle n , C ., 2 1 7 . 2 2 1 . 22 4

B uhr. T .,6 3 B u r a c k , E.. 101 B u r n e tt . R ., I 74

A lle n . M. W .. 62 A M A B o a rd , A m a r i . J.. 60

B u tl e r, J. M ., 64 B u z z e ll , R. D „ 166

A n o t h e r G la s s . 39 A r g y r i s , C ., 7 7, 102 A r m o u r , S., 3 1 . 4 1

C

A shkenas, 9 1 .9 3 A S N E , 40

B

C a m e r o n . G. T ., 115 C a r d y , R. L ., 4 3 C a r e w , D .. 85

B a lk in . D. B . . 4 3

C a r te r . T .. 125, 127. 128. 129. 130 C a r v e th . R „ 170, 174, 180

B a n a s , J. T , 298 B a n k s . S R ., 64

C h a n g . L. A .. 5 6 . 65

B a r g e . J. K .. 30 B a r k e r . J. R ., 86 B a r k in , S. M .. 11 I B a rle y . S. R., 59 . 62 B a r n a r d , C . I., 84 B a r o n . R , 2 1 7 . 2 2 8 . 2 2 9 . 2 3 1 . 2 3 2 . 2 33 B a r r o n . J „ 125. 128, 129, 144 B a rtle tt, C. A ., 173, 174 B a s s . B M .. 3 B a x te r. R ., 137 B e a m . R. A ., 57 B e c k e r . L. B . 3 5. 3 8 . 3 9 . 42 B e c k e r , L., 39 B e c k h a r d . R.. 298 B e r g e n . L. A .. 5 7 , 297

C h a n c y . D ., 62 C h i l d . J., 106 C h il d s . K .. 126 C h y i , H. I.. 107, 114, 117 C o ll in s , B.. 62 C o ll in s . J.. 28 C o m p a i n c , B .. 107, 169 C o o k . B B.. 64 C o o k . V .. 166 C o u l s o n . D. C .. 6 7 , 75 C o v i n g t o n . W G . Jr., 58 . 112 C r o te a u , D .. 75 C r o s b y , P. B , 5 C r u p i. A .. 2 3 3 . 23 4 C u m m i n g s , T. G ., 29 8 C u n n i n g h a m . B., 28 . 2 9 . 34

B la c k ie r, F., 102 B l a n c h a r d , K ., 87 B L S R e le a s e s . 4 I B l u m e n f e l d , H., 125 B o u d r e a u . T .. 75

D D a m o n . W .. 64 D a n ie ls , G . , 29 8

315

316

AUTHOR INDEX

D an ielso n. W .. 67. 10 2 . 109 D avis. M .. 125 D avis. M . 7 8 C ye rt, R. M ., 3 D avis. R. (1957). D ay , G. S.. 192 D ed in sk y , M . L., 112 D ee. J.. 125. 127. 128. 129, 130 D ella. G.. 130, 142. 143. 148, 149. 154, 295 D e m ers, D., 75 D e nison . D. R.. 61 D ossier. G., 87 D e u tsch , M ., 62 D ien es. C .. 125. 128 D o m in ick . J . 219. 220. 221, 222, 233, 244 Drea/.en. Y , 126 D river. M . J.. 13 D ru c k e r, P. F., 6 D unn. P.. 187 D yer. W G.. 33

E E arley, P. C., 93 E astm an . S. T .. 67. 85. 188 E isenhardt, K. M . 111. 112 E m lin g , S., 112 E p h ro n . E.. 233 E n d res, F , 64. 67 Elliott, P.. 62 E rcz. M ., 93

F F alcon e. P., 135, 136, 137 F B I A d v iso ry . 140, 141 Fcdlcr. F . 6 3 F entin, S., 131, 132, 134, 135, 136, 137 F ink. S. L.. 51 Fish. M J . 67, 85 F itzgerald, M ., 287 F leish m an. E. A.. 87 F o w ler. G-, 89 F raycr. C., 143 Fullerton, H .. 116 F u lm er, W ., 77 F u q u a y . J.. 286

G G a d c . P.. 65 G allag h e r, M B., 89 G a rd n e r. H.. 64 G a z ia n o , C., 67 G e rsh o n . R. A.. 108, 109, 169, 170, 180 G crsick , C. J. G.. 86 G h o s h a l, S.. 173, 174 G iles. R. H.. 64 G illm or, D., 125. 127. 128. 129. 144 G iuliani, R. W., 27 G la iron . S.. 4 3 . 44 G old stein. N.. 125. 128. 129 G o m e ry , D „ 107, 169 G o m e z -M e jia . L. R.. 43. 179

G o o d m a n . H.. 271 G ra n g e r, C. W J., 273 G ra y. S.. 233 G re en . A.. 217 G ree n e , C. N ., 56 G reer. J.. 116 Griffin. R. W „ 6. 7. 11, 56 G u h m a n . J.. 116 G u e tz k o w , H .. 62

H H aas, J. W . 62 H ale. S.. 143 Hall. L.. 233 H alo n e n , D.. 126 H a n so n . K.. 269 H arris. R . 298 H arriso n, E. F., 1, 11 H eller. F. A.. 34 H e rse y , P., 87 H e r /b e r g . F.. 56 H ick ey. N.. 28. 126. 74 H in kle. H e n sley , S h a n o r & M artin , L. L. P., 131, 133, 134 H o fstede. G.. 34 Hollifield, C. A., 171, 298 H o ltz-B ac h a . C.. 171 H o u s e , J. R.. 87 How to A lign , 1 3 1 H ow to R e m a k e . 131 H o y n c s. W .. 75 H u be r, G. P.. 11. 19 H u d so n . E., 286, 292 H u g h es, D. W .. 77 H uh. J . 35. 38. 39, 42 H u n sak cr. P L.. 13

I IFJ S urvey , 40 Iv an cev ich , J. M .. 5

J Jacobs, R. D . 198 Jeffres, L. W . (2001). 111 Jo h n sto n e. J. W. C.. 77 Jon es, G. R., 76, 83 Josep h. T.. 77 Ju rczak . P. R . 6 2 , 6 5

K K ah n, R. L.. 107, 111 K anter. R. M .. 112. 115 K aplan, C., 129 K atz, D.. 107. 111 K eeto n. W ., 129 K e m p n e r, M., 193 K iesler. C. A . 60 K iesler, S. B.. 60 K ille b rew , K . C ., 58, 62 K lein. E.. 78

A U T H O R INDEX

K le in . R A .. 198 K o d r ic h , K. P.. 57

O O c c u p a t i o n a l E m p l o y m e n t , 36 , 37 O ’G u i n n , T ., 2 1 7 . 2 2 1 . 224

K o l o d n y , H .. 67 K o s ic k i . G . M . , 39 K r e im e r , R., 2 74

O r l a n d o S e n ti n e l. 2 8 6 O u i c h i , W „ 85

L P L a b o r F o r c e , 35. 37 L a c y , S., 2 9 , 8 8 . 127, 138, 191 L e a v itt. H ., 100

P a r i s i - C a r e w . 85 P e a r c e . J. A .. 198, 20 2 P e a s e , T .. 57 P e t e r s e n , B. K , 61 P h illip s . C. L ., 6 3 . 89 P ic a r d , R. G ., 75 P o l a n s k y . S. H .. 77

L e w i s , M . . I 17 L e w i s , S. A ., 67 L ik e rt. R ., 29 L in . C . A .. I 1 1 L in d .strö m , P. B ., 1 16 L o c k e . E. A ., 55

P o li c y S t a t e m e n t , 144 P o lla rd , G ., 3 10

L o r e n z i . P., 5

P o rte r. M ., 94 M

P o w e r s . A ., 2 9, 85. 88, 88 , I 15 P r e s to n . 1.. 144 P riest. C .. 197

M a r c h , J. G „ 3 M a s l o w . A. H . 52 M a t s u u r a , J., 130, 142, 143, 148. 149. 1 5 4 .2 9 5

P r o g r e s s S ta l le d , 39 P u ritz . J.. 115

M a u c k e r . E ., 140. 141. 142

R

M a u r o , T ., 126 M a u s n e r . B .. 56

R a b a s c a , L .. 112 R a u c h , 11., 137, 138 R e ic h e r t. T .. 1 12

M a y o . E .. 84 M c C l e l l a n d , D., 53 M c D e v i t t . M .. 65

R e ite r. D ,. I 25

M c E w a n , E. K ., 14 M c G i l l , L., 138. 139 M c G i l l . L. T .. 63 M c G r e g o r , D ., 85 M c K e a n . R. N ., 18

R ic h a r d s , J., 144 R o b i n s o n . R. B.. 198. 20 2

M c K e e , M ., 128

R u ssia ), J. T .. 6 7 , 107

R o g e r s , E.. 58. 102. 103. 106 R o s e n e r , J., 89 R u d d e r . G . . 2 72

M c M a n i s , C ., 125 M c Q u a r r i e . F.. 6 4 . 92

S

M ille r. A .. 125 M ille r, K l., 3 0 9 M i ll e r. R ., 63

S c h e i n . E. H .. 3 0 S c h o c m a k e r , P. J. H ., 192

M i ll e r. P.. 63 M o n g e , P.. 2 2 0 , 298 M o o r e . G .. 57

S c h m i d t . W . H .. 87 S c h r i e s h e i m , C .. 88

M o o r h e a d . G .. 6 . 7, 11, 56 M o r g a n . A . N .. 4 0

S c h r i e s h e i m . J.. 88 S e ib e r t, J. H ., 62 S e m e n i k . R ., 2 1 7 . 2 2 1 . 22 4

M o r t o n . J.. 287 M o s e s , I... I 12 M u e l le r . J. E ., 115

S e v e r i n . W . J.. 191 S h a v e r , M . , 152, 2 79 S h e p p a r d . D. L.. 41

M u n k . N ., 203

S h c r i f , M .. 62 S h e r w o o d , P. K ., 187 S h ih . S.. 9 0 . 91

N N a d le r , D. A ., 2 98 N a n u s . B ., I 1 I

S h i p m a n , J . 89 S i m o n , H .. 1. 2, 3. 4 S i m o n . T .. 125. 127, 128, 129. 138. 144. 191

N a p o l i , P., 99 N a tio n a l A s s o c i a tio n o f B r o a d c a s t e r s , 198

S is s o r s , J., 2 1 7 , 2 2 8 , 2 2 9 , 2 3 1 , 2 3 2 , 233 S k in n e r . B. F.. 54

N e a le . M . A .. 7 7 . 7 8 , 86 N e w k i r k , P. T .. 63 N e w m a n . S., 108. 1 11. 117

S k in n e r , S. J.. 5 S k o le r , A b b o tt & P re s se r, L. L. P., 132, 133, 134 S n y d e r m a n . B . 56

N e w s p a p e r A s s o c i a tio n o f A m e r i c a , 188 N o o n . M 102 N o r t h c r a f t , G . B.. 7 7 . 7 8 . 86

S o n d h a u s . E .. 89 S o r e n s e n . P. F. Jr., 101 S m i th . G . D .. 162

31 7

318

A U T H O R INDEX

vv

S t a m m , K .. 297 S t e v e n s , R. E., 187 S te w a r t . T. A .. 44

W a n b e r g , C. R .. 298 W a n g , K., 2 3 3 . 23 4

S tig lc r , G J.. 189 S tj e r n b e r g , T ., 67 S to n c m a n . P.. 106 S t r a s s m a n , P., 106 S tr a u b . J. T ., 53 . 61

W a r n e r . C ., 58 W e a v e r , D ., 5 6 . 5 7 , 63, 6 5. 297 W e a v e r . J.. 109 W e b e r , M .. 7 5 . 76 W h i t i n g , C . S.. 165 W i l h o i t . G . C ., 5 6. 5 7 . 6 3 . 6 5

S tr o h . L. K.. 7 7 . 7 8 . 86 S tr u p p , J., 109 S u k o s d . M . , 171 S u n d a r . S . S., 117 S y lv ie , G ., 56 , 6 2, 6 5 , 6 5 , 6 7 , 100. 102, 107, 109, 1 10, 1I 1 . I 1 4 .1 1 7

W i l l i a m s . F.. 22 0 W il p e r t , B., 34 W i m m c r , R .. 2 1 9 . 2 2 0 . 2 2 1 , 2 2 2 . 2 3 3 . 24 4 W i t c o v e r , J., 12 W i t h e r s p o o n . P. A ., 6 5 . 6 7 . 110, 111 W o l f c r m a n . E.. 37

T T a n k a r d , J W . , 191 T a n n e n b a u m , R ., 87 T a y lo r . D .. 63 T a y l o r , R. N ., 1 T h o m a s . D . C .. 87 T h o m p s o n , M ..1 3 1

W o r l e y , C ., 298 W rite r s an d E d it o r s . 35

Y Y e tto n . P. W .. 13 Y o v o v i c h . B. G ., 3 6. 3 7 , 38

T o n e r , M ., 271 T u r n e r . R. J., 64 T u r o w . J., 9 3. 174, 180

Z Z a c h a r y . M .. 131. 134. 137 Z a v o i n a , S., 112 Z i p p . F ., 143 Z i m m e r m a n n . S.. 62

T w o T o o ls , 132 T w o W a y s , 131

U U n d e r w o o d . D ., 3 12 U .S . C e n s u s B u r e a u . 35. 188. 189. 29 2 U .S . D e p a r t m e n t o f C o m m e r c e . 169 U .S . H o u s e o f R e p r e s e n t a t i v e s , 170

V V a n M a a n c n . J.. 5 9. 62 V la d .T ., 3 5 .3 8 ,3 9 ,4 2 V r o o m , V . H ., 13, 55

Z u c k m a n , H ., 125, 127, 128, 129, 130

S

ubject

a

A B I I n f o r m / P r o Q u c s t , 149. 150. 157. 2 5 5 . 2 8 5 . 29 2 A c c e s s , 1 4 2 -1 44 p r i v a c y is s u e s , 1 4 3 - 1 4 4 se c u r ity is su e s. 143 A cco u n tab ility , 2 7 -2 8 A cco u n tin g inform ation, 2 6 1 -2 6 5 fin an cia l. 2 6 2 - 2 6 5 m an ag e rial, 2 6 6 -2 7 0 A c k n o w l e d g m e n t s , vii. 4 5 . 181, 3 00 A dvertising. 2 1 6 -2 1 8 . 2 2 4 -2 3 4 in d e x a n a ly s is , 2 2 5 - 2 2 9 m e d i a p l a n n i n g c o n c e p t s a n d p ra c tic e s . 2 2 4 - 2 3 4 C P M o r c o s t p e r th o u s a n d , 2 2 9 - 2 3 1 C P P o r c o s t p e r p o in t. 2 3 2 - 2 3 3 r e a c h a n d f r e q u e n c y , 229 r e s e a rc h s o u r c e s , 2 3 5 - 2 3 6 s t u d ie s , 243 technology and. 116-117 A dv ertisin g A ge, 255 A d v e r t i s i n g d ir e c to r . 82 A m e r i c a n A d v e r ti s in g F e d e ra t io n ( A A F ) . 147 A m e r i c a n A r b it r a ti o n A s s o c i a tio n , 140. 147, 2 94 A m e r i c a n A s s o c i a t i o n o f A d v e r ti s in g A g e n c i e s (A A A A ) , 147 A m e r i c a n M a r k e t i n g A s s o c i a tio n . 2 16 A m e r i c a n S o c ie t y o f N e w s p a p e r E d it o r s ( A S N E ) , 287 A m e r i c a n s W it h D is a b i li ti e s A c t, 142 A n tit r u s t , 127, 196 J O A - j o i n t o p e r a t i n g a g r e e m e n t s , 127 A r a b A m e r i c a n s , 145 A r b it r a ti o n , 140 A r b it r o n , 2 3 1 A s ia n A m e r i c a n J o u r n a lis ts A s s o c i a tio n ( A A J A ) , 145 A ssessm ent. 3 0 - 3 1 . 4 4 - 4 5 . 1 3 1 -1 4 0 , 1 79-180. 28 9 -290 A s s i g n m e n t m a n a g e r , 79 A s s o c i a t e d P r e s s vs. U .S.. 126. 127 A t l a n ta J o u r n a l - C o n s t i t u t i o n , 28 A udience b e h a v io r . 1 16 f r a g m e n t a tio n , 1 8 8 - 1 8 9 i n c o m e , 191 ta rg e t m a r k e t. 8 2 - 8 3 , 2 0 0 - 2 0 1 ta s te, 1 9 1 - 1 9 2 te c h n o l o g y . 1 9 2 - 1 9 3

In

dex

A u d it B u r e a u o f C ir c u l a ti o n ( A B C ) , 234 A B C i o r A B C I n t e ra c t iv e . 2 34

B B aby boom g eneration, 3 7 -3 8 B a l a n c e s h e e ts . 2 6 2 - 2 6 6 a s s e ts , 2 6 2 - 2 6 4 liab ilitie s. 2 65 s h a r e h o l d e r ' s e q u it y , 265 B a rri e rs to e n tr y , 1 9 5 - 1 9 6 B e r t e l s m a n n . 169 B e tt e r B u s in e s s B u r e a u (see C o u n c i l o f B e tte r B u s in e s s B u r e a u s ) B la c k E n t e r t a i n m e n t T e l e v i s i o n , 1 16 Bon A p p etit, 230 B o o k p u b li s h i n g . 197 B o t t o m l y . T .. 34 B o u n d e d ra t io n a l it y , 3 B r a n d i n g , 198. 1 1 1 - 1 1 2 B r o a d c a s t in g & C a b l e c a s t i n g Y e a r b o o k . 291 B udgeting, 2 6 1 -2 8 3 b u d g e ts a n d i n c o m e s t a te m e n ts . 2 6 6 - 2 7 0 dep artm en tal, 2 7 4 -2 7 6 d e p r e c i a t i o n , 26 4 d e v e l o p i n g b u d g e ts . 2 6 8 - 2 7 0 . 2 7 3 - 2 7 8 expenses, 2 6 6-267 f o r e c a s ti n g , 2 7 3 - 2 7 4 g o o d w i l l . 26 4 m a s t e r b u d g e t p la n . 273 m ethods, 2 7 6 -2 7 8 operating budget, 266. 272. 2 7 4 -2 7 6 z e r o - b a s e d , 27 7 B u n d l i n g , 194 B u r e a u o f E c o n o m i c A n a ly s i s , 292 B u r e a u o f L a b o r S ta tis tic s , 29 2 B ureau cracy . 7 5 -7 6 B u s in e s s m a n a g e r . 82 B u y e r c o n c e n t r a t i o n , 195

C C a b l e N e w s N e t w o r k ( C N N ) . 103, 115 C a b l e te le v is io n a u d i e n c e m e a s u r e m e n t a n d a n a ly s is . 231

2 34

b a r r ie r s to e n tr y , I 96 cases, 2 1 4 -2 1 5 , 2 5 9 -2 6 0

319

320

SUBJECT INDEX

C ab le television (c o n ti n u e d ) d e m a n d , 190 distrib utio n. 200 regulatory (rends, 192 re search sou rces, 2 3 8 - 2 4 0 C ab lctc lcvisio n A dve rtising B u reau . 258 C ases adv ertising . 1 5 1 -1 5 4 , 1 8 1 - 1 8 5 , 2 4 7 - 2 5 4 , 2 5 7 - 2 5 9 . 2 7 9 -2 8 0 ,2 8 2 -2 8 3 ,2 8 5 -2 9 6 b u d g e tin g , 2 7 8 - 2 8 3 cable. 9 7 - 9 8 . 2 5 9 - 2 6 0 . 2 9 6 - 3 0 0 ch a n g e m a n a g e m e n t. 2 8 5 - 2 9 6 . 2 9 6 - 3 0 0 c o m m u n ic a tio n , 2 9 6 - 3 0 0 co n v e rg e n c e , 118-1 19. 2 8 5 - 2 9 6 c ro s s-p ro m o tio n . 118-1 19, 2 8 5 - 2 9 6 cata , 2 0 5 - 2 1 4 , 2 4 5 - 2 5 4 , 2 8 2 - 2 8 3 , 2 9 6 - 3 0 0 decision m a k in g . 2 4 - 2 6 . 2 8 5 - 2 9 6 . 2 9 6 - 3 0 0 dig itization, 9 7 - 9 8 diversity. 4 9 - 5 0 , 6 8 - 7 0 . 1 5 1 -1 5 4 . 2 8 5 - 2 9 6 d o w n siz in g (see L ay offs) ex ten d e d . 2 8 4 - 3 0 0 introduction. 2 8 4 - 2 8 5 film .214-215 freedom o f in fo rm atio n, 1 5 7 -1 5 8 health and safety issues. 149-151 Internet, 2 5 - 2 6 , 4 5 - 4 8 , 7 1 - 7 2 . 1 1 8 -1 1 9 . 1 2 2 -1 2 4 , 1 4 8 -1 4 9 ,1 5 4 -1 5 7 ,1 5 7 -1 5 8 ,1 8 1 -1 8 5 , 2 5 7 -2 5 9 .2 8 5 -2 9 6 layoffs, 4 9 - 5 0 , 2 9 6 - 3 0 0 leade rship. 4 5 - 5 0 , 2 8 5 - 2 9 6 legal. 1 4 8 -1 5 8 . 2 8 5 - 2 9 6 In tro d uction , 1 4 8 -1 4 9 m ag az in e. 2 5 4 - 2 5 7 m a rk et an alysis. 2 0 5 - 2 1 5 , 2 8 5 - 2 9 6 m ark e tin g and research. 2 4 5 - 2 6 0 , 2 8 5 - 2 9 6 m e d ia co n g lo m e ra te o r g ro u p . 9 5 - 9 7 . 2 8 5 - 2 9 6 m o rale. 7 0 - 7 1 , 7 2 -7 3 m o tiv atio n , 6 8 - 7 3 new m edia. 2 1 4 - 2 1 5 n e w sp a p e r. 2 5 - 2 6 , 4 5 - 4 8 . 7 0 - 7 1 , 1 1 8 -1 1 9 . 1 8 1 -1 8 5 .2 5 7 -2 5 9 , 285-296 ob scen ity or p o rn o g ra p h y . 2 8 5 - 2 9 6 p e rfo rm a n c e evalu a tio n, 1 5 1 -1 5 4 , 2 8 5 - 2 9 6 plan n in g . 1 8 1 -1 8 5 . 2 8 5 - 2 9 6 . 2 9 6 - 3 0 0 privacy. 1 5 4 - 1 5 7 . 2 8 5 - 2 9 6 public relations, 4 9 - 5 0 , 7 1 - 7 2 , 1 2 2 -1 2 4 , 2 5 9 - 2 6 0 radio. 2 0 5 - 2 1 5 . 2 8 0 - 2 8 1 . 2 8 2 - 2 8 3 ratings. 2 4 5 -2 4 7 structure, 9 4 - 9 8 , 2 8 5 - 2 9 6 , 2 9 6 - 3 0 0 stud en t m ed ia . 2 8 1 - 2 8 2 te ch n o lo g y . 1 1 8 -1 2 4 , 2 8 5 - 2 9 6 television, 6 8 -7 0 , 7 2 -7 3 , 11 8-119, 1 20-122, 2 4 5 -2 5 4 terrorism , 149-151 vision. 2 9 6 - 3 0 0 y o u ths in w o rk fo rce . 7 1 - 7 2 . 7 2 - 7 3 . 2 9 6 - 3 0 0 C e n su s B u reau , 147, 2 9 2 - 2 9 3 C e n te r fo r M ed ia L iteracy, 148 C e n te rs for D isease C on trol and Preven tion (C D C ), 147,1 4 9 ,1 5 0 C entraliza tion . 7 6 - 7 7 Change ad ap tin g to tech n o lo g ical, 1 1 1 organ iz atio n al. 2 9 7 - 2 9 9

C h ero k e e. 285, 293 C h ica g o T rib un e, 83, 112, 257 C h ie f ex ecutiv e officer. 8 0-8 1 C h ie f e ng inee r, 81 C h il d r e n 's A dv ertisin g R ev iew U nit (C A R U ), 147. 155 C h ild re n ’s O nline Privacy Protection Act, 13 0 .1 46,155 C irculation m an ag e r. 82 City editor, 79 C ivil R ights A c t o f 1964. 138 C lu sterin g, 194 C o m m u n ic a tio n , 129. 298 d o cu m e n ta tio n . 1 3 7 -1 3 8 p e rfo rm a n c e e valu a tio ns, 1 3 1 -1 3 4 p ro gressiv e discipline, 1 3 5 -1 3 6 term in atio n. 1 3 6 -1 3 7 C o m p a n y m issio n. 2 0 2 - 2 0 3 . 206 C o m p le m e n t, 191 C o n ce n tra tio n . 1 9 3 -1 9 9 b uy er, 195 seller. 1 9 3 -1 9 4 C on d itio n in g . 54 C o n tin g en cy theo ry , 8 7 - 9 0 C o lu m b ia Jo urna lism R e v iew . 146 C o m m e rc ia l A lert, 148 C o m m u n ic a tio n , 30 C o m m u n ic a tio n s D ece n c y A ct. 126 C o m p a n y vision. 2 7 - 2 8 C o m p e titiv e M ed ia R ep ortin g ( C M R ), 243, 255 C o m p la in ts. 129. 138 C on ditio ns ex tern al, 1 8 8 -2 0 2 financial. 2 0 3 - 2 0 5 in ternal, 2 0 2 - 2 0 3 C o n so lid atio n . 192, 194 Consum er in co m e, 191 taste, 1 9 1 -1 9 2 C o n s u m e r P rod uct Safety C o m m is s io n (C P S C ), 146 C o n v e rg e n c e , 58, 286 C ost(s), 1 8 -2 1 . 1 9 5 -1 9 6 . 198. 2 0 3 -2 0 5 f i x e d . 195 o pp ortu n ity cost, 19-21 v ariab le. 198 C ost-benefit analysis, 18-21 C ost per p oin t (C P P ). 2 3 2 - 2 3 3 , 245 C ost per th o u san d (C PM ), 2 2 9 - 2 3 1 . 243. 245 C ost structures, 198 C o u n c il o f B etter B usiness B u reau s ( C B B B ), 146 C ro ss -p ro m o tio n , 286 Cultural ch allen g es. 32. 34 d ifferen ces, 34 m a n a g e m e n t, 1 7 0 - 1 7 2 , 176, 1 7 7 -1 7 9 C ulture. 32 o rg anization al, 32 in ternational. 32, 34

D D e cep tion in adv ertisin g. 144 D ecision m a k in g , 1 -2 6 budgets, 9 - 1 0 . 1 6 -1 7 . 1 8 - 2 1 . 2 2 - 2 3 , 2 7 0 - 2 7 3

SUBJECT INDEX

eases. 2 4 - 2 6 co nstra ints, 3, 1 1 -1 7 definition of. 2. also sec. 1 -4 by grou ps. 1 -2 , 1 1 -1 3 . 1 4 -1 6 . 3 1 - 3 2 , 3 2 - 3 4 lo ng -ran ge v ersu s sh ort-ran ge, 1 6-17 m a n a g e ria l, 1 -2 . 2 7 0 - 2 7 2 process. 6 - 1 1 p ro g r a m m e d and n o n p ro g r a m m e d . 4 - 5 styles, 1 3 -1 4 time, 2 - 3 , 8, 9, 10, 1 1 -1 3 . 1 6 -1 7 tools for. 1 7 -23 D ecision process, 6 - 1 0 D ecision w h eel, 6 - 7 D e m a n d , 1 8 9 -1 9 2 elasticity and inelasticity, 1 8 9 -1 9 0 product, 1 8 9 -1 9 2 D e m o g ra p h ic s. 189. 202. 222. 2 2 4. 226, 228. 242 D e p a rtm e n t o f C o m m e rc e . 292 D e p a rtm e n t o f L ab or. 292 D c p a rtm c n ta tio n . 8 0 - 8 2 D e sig na ted m ark et area, 2 3 1 - 2 3 2 Detroit Free Press . 145 D irect M ark eting A ssoc iatio n (D M A ). 147, 154, 155 D iscrim in atio n, 1 3 8 -1 4 0 D issatisfaction. 5 6 - 5 7 D iversity, 32, 4 1 - 4 2 . 5 7 - 5 8 , 90, 1 3 8 -1 4 0 , 293, 294 D ivision o f labor, 79 D o c u m e n ta tio n . 1 3 7 -1 3 8 D o w n siz in g (see L ayoffs) D u al-facto r th eory. 56 D ual p rod uc t m ark et, 187

E E -co u p o n s, 36 E arn hard t. D ale. 1 4 3 -1 4 4 . 157 E arn ing s. 297 E bsco. 150, 255, 285 E c o n o m ic co n d itio n s. 2 0 1 - 2 0 2 E c o n o m ie s o f scale. 194 Editor & Publisher. 145. 1 5 8 ,2 9 1

Editor & Publisher M arket Guide. 291 E M I G ro u p . 169 E m p lo y ee baby boom gen era tio n . 3 7 - 3 8 health and safely, 1 4 0 -1 4 2 co n tin g en c y plan. 141 safety. 140 screen in g mail o r parcels. 140-141 security. 141 input, 1 3 1 -1 3 3 , 135, 137, 298 interactions. 8 4 - 8 5 m in ority. 4 1 - 4 2 retention, 3 6 - 3 7 . 42 seniors, 3 7 - 3 8 w o m e n , 3 9 -4 1 y o uth s in w o rk fo rce. 3 8 - 3 9 E n v iro n m e n ta l sc ann in g, 108 E qual O p p o rtu n ity C o m m is s io n . 145, 293, 294 E q uity, 5 4 -5 5 E th no cen tric ap pro a ch . 178 E. W . S cripp s. C o ., 112 E xpatriates, 168, 1 7 8 -1 7 9 E x p ecta n c y . 55

321

E x p e n se s, 2 6 6 - 2 6 8 n on o p cra tin g , 2 6 7 - 2 6 8 op eratin g. 2 6 7 - 2 6 8 E xternal co nd itio ns. 188

F Federal Bureau o f Investigation (FBI), 140-14 1,14 9, 150 adv isory for suspicio us pack ag es. 1 4 0 -1 4 1 . 149 Federal C o m m u n ic a t io n s C o m m iss io n (F C C ), 126, 146 F ederal E m e rg e n c y M a n a g e m e n t A g e n c y (F E M A ), 145. 149, 150 Federal T ra d e C o m m iss io n (F T C ). 144. 146. 154 ad ve rtisin g policy sta tem ents and gu ide line s, 144 K id z P riva cy. 146. 154. 155 screening a d v e rtise m en ts , 144 F ed eral T ra d e C o m m is s io n A ct. 144 Federal W e b N av igato r. 145. 157 F edS tats, 292 Film cases, 2 1 4 - 2 1 5 costs, 197 tec h n o lo g y . 1 9 2 -1 9 3 F ina ncial co n d itio n s. 2 0 3 - 2 0 5 F ina ncial syndication ru les. 1 9 8 -1 9 9 First A m e n d m e n t . 142 Folio, 255 Forbes. 2 3 0 - 2 3 1 . 243 F o recasting . 1 9 2 - 1 9 3 . 2 7 3 - 2 7 4 tec h n o lo g y , 1 92 -19 3 F o rm al m a n a g e m e n t. 7 5 - 8 3 Fortune, 2 3 0 - 2 3 1 , 243 Fou r p ' s . 1 6 6 -1 6 7 F ragm en tatio n. 1 8 8 -1 8 9 F re ed o m o f Inform atio n A ct (F O IA ). 1 4 2 -1 4 4 . 158 FO IA R eso u rce C en ter, 145, 158 F re q u e n c y . 229 F rustration, 56

G G ale D irectory. 291 G an n ett, 83 G en era l m an a g e r, 81 G en eratio n X, 29. 41 G eoc entric app ro ac h , 178 G e o g ra p h ic , 83, 2 2 6 - 2 2 7 G iuliani. R.. 2 7 - 2 8 G oal(s) definition, 2 e x a m p le s. 165 individual and g rou p d ecisio ns, 1 1 -1 3 lo ng -term . 298 mission statem ents and. 160-161 setting, 55, 1 6 4 -1 6 5 specifying. 7 - 8 G lob al c o m p a n ie s, 1 7 3 -1 7 4 G lob al m ed ia structures, 9 0 - 9 3 G lo b alizatio n . 192. 200 G o o g le, 256 G ra h a m . K., 28 G ro u p buildin g, 8 5 - 8 7 decision m a k in g , 1 -2 , 1 1 -1 3 , 1 4 -1 6 . 3 1 - 3 2 , 3 2 - 3 4

322

SUBJECT INDEX

JO A -jo in t o p e r a t in g a g r e e m e n t s . 127

G r o u p (c o n t i n u e d ) d is c u s s i o n . 3 1 - 3 2

J o u r n a l i s t ' s G u id e to the In te rn e t. 148. 158 J o u r n a lis ti c s t a n d a r d s . 2 9 7 - 2 9 8

m o tivation. 5 9 -6 2 team s, 3 2 -3 4

K H

K e e n e r , Y .. 4 5 . 181

H a w t h o r n e e ff e c t. 84 H e a lth (s e c E m p l o y e e H e a lth & S a f e t y ) H D T V , 200 H o u s e h o l d s U s in g T V ( H U T ) . 231

L a n h a m A c t. 144 L ayoffs. 4 9 -5 0 . 2 9 6 -3 0 0 Leadership. 2 7 -5 0

H u m a n r e s o u r c e s . 178 e t h n o c e n t r i c a p p r o a c h , 178 g e o c e n t r ic a p p r o a c h , 178

c h allenges, 2 9 - 3 0 c o m m u n i c a t i o n . 30

p o ly c e n t r i c a p p r o a c h . 178

ro le, 2 7 - 2 8 ro o ts. 28

I Im p e r a t i v e s to (¡ro w R e a d e r s h i p , 2 9 3 . 295 I n c o m e s t a te m e n t. 2 6 6

team s. 3 2 -3 4 t h e o r y , 2 9 , 30 L e g a l. 1 2 5 - 1 5 8 g e n e r a l a r e a s o f c o n c e r n . I 2 7 - 130 p r e v e n t in g p r o b l e m s , 1 3 0 - 1 4 5

In d e x e s . 2 2 5 - 2 2 8 Inform al m an ag e m en t, 8 3 -8 7 I n f o r m a t io n c o ll e c ti n g an d a n a l y z i n g , 6 - 1 0 c o n s t r a i n t s on d e c is io n m a k e r s , II

L

14

r e s o u r c e s o n li n e . 1 4 5 - 1 4 8 L e g a l I n f o r m a t io n In s titu te , 147, 158 L e x i s - N e x i s , 149. 150. 157. 2 5 5 . 2 8 5 . 2 92

fo r d e c is io n m a k i n g . 2 1 - 2 3 s o u r c e s o f, 1 7 - 1 8 In ta n g ib le re tu rn s . 2 04 205

L ib e l. 1 2 7 - 1 2 9

I n t a n g ib l e s . 19 In te r a c t iv e a d m i n i s t r a t o r , 81

d e f a m a t o r y s t a te m e n ts , 128 L ib el D e f e n s e R e s o u r c e C e n t e r , 145 L if e s ty l e , 189. 2 0 0 - 2 0 1 . 2 0 2 . 208 L ifesty le M a r k e t A n a ly st, 151. 247, 2 5 5 - 2 5 6 . 291 L o n g - te r m g o a ls , 29 8

In te rn a l c o n d i t i o n s . 2 0 2 - 2 0 3 In t e g r a t e d B r a n d P r o m o t i o n s ( I B P ) , 2 1 6 - 2 1 8 In te g ra te d M a r k e tin g C o m m u n i c a t i o n s ( I M C ) , 2 1 6 - 2 1 8 I n t e r n a t io n a l c o m p a n i e s , 173 In t e r n a t io n a l m a n a g e m e n t , 1 6 8 - 1 8 0 a ssessm en t, 1 7 9 -1 8 0 finan cial p l a n n i n g . 179 h u m a n r e s o u r c e s , 178 in t e r m e d ia t e p la n n i n g . 177 180 i n t e r n a t io n a l m a r k e ts , 1 6 8 - 1 7 7 i n t e r n a t io n a l m a r k e t i n g , 177 in t e r n a t i o n a l m o d e l s . 1 7 3 - 1 7 5 j o i n t v e n tu r e s , 170. 173, 176 licensing. 1 7 3 .1 7 6 partnerships. 1 7 5 -1 7 7 r e g u l a to r y r e s tr i c ti o n s , 1 7 1 - 1 7 2 stra te g ic p l a n n i n g , 1 6 8 - 1 7 7 s u b s id ia r ie s , 173, 174. 175. 176. 178 t e c h n o l o g y c o n c e r n s , 180 In te r a c t iv e A d v e r t i s i n g B u r e a u ( I A B ) . 147. 1 5 4 .2 3 4 .2 5 7 .2 9 5 .2 9 6 In te rn e t, 3 5, 83. 9 9 , 103, 109. 1 1 1 - 1 1 7 , 2 0 0 b a rr ie rs to e n tr y . 1 9 5 - 1 9 6 cases. 2 14-215 d is tr i b u ti o n , 2 00 le g a l g u i d e l i n e s . 148 r e s e a rc h s o u r c e s , 2 4 0 - 2 4 2 In t e r n e t L a w L ib r a r y . 145, 158 I n v e s t m e n t m a r k e t. 187. 20 3

J Jo b s a tis f a c tio n . 298 J o i n t c o m m o d i t y . 190

a b s o l u t e p ri v il e g e , 128 a d v ic e . 1 2 8 - 1 2 9

L o s A n g e l e s T im e s . 2 8 9 . 29 0

M M agazine cases. 2 1 4 -2 1 5 p ric e , 190 re s e a rc h s o u r c e s , 2 3 7 - 2 3 8 M a g a z i n e P u b l i s h e r s o f A m e r i c a ( M P A ) , 255 M anagem ent f o r m a l, 7 5 - 8 3 in f o r m a l . 8 3 - 8 7 M a n a g i n g e d it o r , 8 I M arket b o u n d a r i e s . 115 g row th and d e v e lo p m e n t, 1 8 8 -1 8 9 f a c t o rs , 1 9 3 - 2 0 5 ta rg et, 2 0 0 - 2 0 1 M a r k e t a n a ly s is , 1 8 6 - 2 1 5 cases. 2 0 5 -2 1 5 e x t e r n a l c o n d it io n s , 188 m a r k e t f a c t o rs , 1 9 3 - 1 9 9 process. 187-188 S W O T a n a ly s is . 2 0 2 - 2 0 3 technology, 199-200 tr e n d s . 1 8 8 - 1 9 3 M arket g ro w th , 1 8 8 -1 8 9 M a r k e t p o w e r , 194. 1 9 5 - 1 9 6 . 1 9 8 - 1 9 9 M a r k e t s t r u c tu r e . 1 9 3 - 1 9 9 M arketing, 2 1 6 -2 6 0 d e fi n it io n . 2 1 6 - 2 1 8

SUBJECT INDEX

323

f o u r p ’s, 1 6 6 - 1 6 7 in te r n a t io n a l , 177 M a r k e t i n g re s e a rc h

N a tio n a l A s s o c i a t i o n o f B la c k J o u r n a lis ts ( N A B J ) .

process, 2 1 8 -2 1 9 M a s l o w ' s h ie r a r c h y o f n e e d s , 52

N a tio n a l A s s o c i a tio n o f H is p a n i c J o u r n a lis ts (N A 1 I J ), 145 N a tio n a l L e s b ia n & G a y J o u r n a lis ts A s s o c i a tio n

145, 293 N a tio n a l A s s o c i a tio n o f B r o a d c a s t e r s ( N A B ) . 146

M c D a t a C o r p o r a t i o n . 44 M e d ia aud ien c es, 2 1 7 -2 1 8

( N L G J A ) , 145 N a tio n a l P r e s s P h o t o g r a p h e r ’s A s s o c i a t i o n ( N P P A ) , 1 4 6 .1 5 0

n ic h e , 21 7 n o n tr a d it io n a l , 2 17 s a la rie s . 35

N a tiv e A m e r i c a n J o u r n a lis ts A s s o c i a t i o n ( N A J A ) , 1 4 5 .2 9 3 N ew m edia

s p e c i a li z e d , 217 tr a d it io n a l , 2 17 v e h ic le . 2 1 7 . 2 2 5 . 22 9

b a rr ie rs to e n tr y , 1 9 5 - 1 9 6 cases, 2 1 4 -2 1 5

M edia ow nership, 126-127 e f f e c ts o f c o n s o l i d a t i o n , 7 5. 192. 194

d is tr i b u ti o n , 2 0 0 re s e a rc h s o u r c e s . 2 4 0 - 2 4 2 N e w Y o rk T im e s . 8, 12, 108. 1 1 1 . 2 1 7 . 2 2 5 . 257 N e w Yorker, 230 N e w s C o r p . , 169. 171

M e d i a R e s e a r c h C e n te r . 148 M e d i a m a r k R e s e a r c h Inc. ( M R I ) , 151, 2 2 5 - 2 2 9 , 2 4 3 , 2 4 7 . 2 5 5 - 2 5 6 . 2 92

N e w s e d ito r. 79 N ew spaper(s)

r e s e a rc h s o u r c e s , 2 3 7 - 2 4 2 M e d i a A c c e s s P ro j e c t, 126 M e d i a kit. 2 4 3 , 2 5 7 - 2 5 9

N e w s d ir e c to r . 81

d a ta ta b le s. 2 2 6 - 2 2 8 , 2 4 8 - 2 5 3 M e d i a w e e k , 292 M e d i a t i o n (s e c A rb it r a ti o n )

c a s e s . 2 5 - 2 6 . 4 5 - 4 8 . 7 0 - 7 1 . 1 1 8 - 1 19. 1 8 1 - 1 8 5 ,

3M M e e t i n g N e t w o r k . 31 M e e t in g s , 3 1 - 3 2

departm ents, 8 1 -8 2 m a r k e t g r o w t h tr e n d s , 1 8 8 - 1 8 9 research sources. 2 3 7 -2 3 8

M ino rity C iv il R ig h ts A c t o f 19 6 4 , I 38 r e c r u i t m e n t a n d re t e n ti o n . 4 1 - 4 2 w ork e n v iro n m e n t. 90 M i s s i o n s t a t e m e n t , 185, 2 0 2 - 2 0 3 , 20 6 M otivation. 5 1 -7 3 cases. 6 8 -7 3 c o n c e p t s a n d th e o r ie s a u t o n o m y . 57. 59 . 6 2 . 6 5 - 6 7

2 5 7 -2 5 9 ,2 8 5 -2 9 6 c h a n g e , 110

te c h n o l o g y . 199 N e w s p a p e r A s s o c i a tio n o f A m e r i c a ( N A A ) , 146, 154, 2 5 7 . 287 N F O W o r l d G r o u p I n D e p th In te ra c tiv e P a n e l, 222 N ielsen. 2 3 1 -2 3 4 N ie l s e n / N e t R a ti n g s , 234 N P D G r o u p O n l i n e P a n e l. 222

c o n d i t i o n i n g , 54 e q u it y , 5 4 - 5 5 e x p e c t a n c y . 55

O

g o a l- s e tt in g , 55 needs. 5 2 -5 3

O b s c e n i t y (see P o r n o g r a p h y ) O ffic e o f E m e r g e n c y P r e p a r e d n e s s , 150 O n l i n e r e s o u r c e s . 145 148

s a tis f a c ti o n . 5 5 - 5 9 groups. 5 9 -6 2 in f lu e n c e s . 5 9 - 6 2 i n d i v id u a l s . 5 2 - 5 9 job p erform ance, 5 4 -5 9 n e e d s and in f lu e n c e s . 5 2 - 5 4 problem s, 6 2 -6 8 n e e d s a n d in f lu e n c e s , 5 2 - 5 4 re t e n ti o n . 62 63 stre ss . 6 3 - 6 4 m i s s i n g v a ri a b le s . 6 4 - 6 8 g ro u p b e h a v io r . 5 9 - 6 2 M R I (see M e d i a m a r k R e s e a r c h Inc.) M S N B C . c o m , 82. 83 M u l t i - ta s k in g . 297 M u l t i n a t i o n a l c o m p a n i e s , 173 M u r d o c h . 169

N N a r r o w c a s t i n g . 201 N a tio n a l A d v e r ti s in g D iv is io n ( N A D ) . 1 4 6 - 1 4 7 N a tio n a l A d v e r ti s in g R e v ie w B o a rd ( N A R B ) . 1 4 6 - 1 4 7

O r e g o n i a n , 34 O r g a n i z a t i o n a l c u lt u r e , 2 0 2 —2 03 O w n e r s h i p ru les. 1 2 6 - 1 2 7

P

P a t h - g o a l th e o r y , 8 7 - 8 9 P e a r s o n P L C . 169 P e r f o r m a n c e e v a lu a tio n . 1 3 1 - 1 4 0 , 2 8 9 - 2 9 0 c o n s i s t e n c y in, I 33 docu m en tatio n . 1 37-138 g o a ls , se ttin g o r a c h i e v i n g . I 33 j o b d e s c r ip ti o n s , 132 m easures, 1 3 1-132 p r o g r e s s i v e d is c ip l in e , 1 3 5 - 1 3 6 te r m i n a t i o n , 1 3 6 - 1 3 7 tra in in g m a n a g e r s in, 1 3 3 - 1 3 4 P e r f o r m a n c e M a n a g e m e n t (see P e r f o r m a n c e E v a lu a t io n ) P e r s o n n e l . 195. 198 P e r s o n s U s in g T V ( P U T ) , 231 P e w R e s e a r c h C e n te r . 147

324

SUBJECT INDEX

P l a n n i n g . I 5 9 - 1 85 c o m m o n c h a r a c t e r i s ti c s , 1 6 0 - 1 6 ! fin a n c ia l. 1 6 7 . 2 6 8 - 2 7 0 hu m an resources. 1 6 7 -1 6 8 in t e r m e d i a t e , 159. 1 6 6 - 1 6 8 in te r n a t io n a l . 1 6 8 - 1 8 0 st r a te g i c , 1 6 1 - 1 6 6 , 1 6 8 - 1 7 7 in term ed iate, 1 7 7 -1 8 0 le v e ls o f . 272 m a r k e t i n g p la n , 1 6 6 - 1 6 7 p r o b l e m s . 271

R a ti n g , 2 3 1 - 2 3 4 R e a c h , 22 9 R e a c ti v e d e c is io n s . 5 - 6 R e a d e r s h i p In s titu te . 2 8 7 , 2 9 2 , 295 R e c r u it m e n t , 3 7 - 3 8 . 4 1 - 4 2 R e e d - E l s e v i e r . 169 R e g u la t io n . 1 2 5 - 1 5 8 , 192, 1 9 5 - 1 9 6 , 2 0 4 , access. 142-144 a rb i tr a tio n . 140 cases, 1 4 8-158, 2 8 5 -2 9 6 c h a n g i n g n a tu re of, 1 2 5 - 1 2 7

s h o r t- r u n . 159. 168, 2 7 1 - 2 7 2 sk ills, 1 6 7 - 1 6 8 ste p s . 1 5 9 - 1 6 1

d e c e p t i o n , 144 discrim ination, 1 3 8 -1 4 0 docu m en tatio n . 1 37-138

s tra te g ic , 159. 1 6 1 - 1 6 6 i n t e r n a t io n a l m a r k e t s , 1 6 8 - 1 7 7 to o ls. 161

g e n e r a l a r e a s o f. 1 2 7 - 1 3 0 a n titr u s t, 127 li be l, 1 2 7 - 1 2 9

P o l y c e n t r i c a p p r o a c h , 178 P o r n o g r a p h y , 142

p r i v a c y , 12 9 - 1 3 0 h e a lth a n d sa fe ty . 1 4 0 - 1 4 2

P o s i ti o n in g . 2 1 7 . 243 P o y n t e r In s titu te , 148 P ro d u c e r . 79

o n li n e r e s o u r c e s . 1 4 5 - 1 4 8

P r o d u c t io n m a n a g e r . 82 P ro g r a m d ir e c to r . 81 P u b lic B r o a d c a s t i n g S y s t e m . 2 2 5 - 2 2 8 . 247-254 P u b li s h e r . 81

p r o g r e s s i v e d is c ip l in e . 1 3 5 - 1 3 6 te r m i n a t i o n , 1 3 6 - 1 3 7 p r e v e n t i n g le g a l p r o b l e m s ,

o w n e r s h i p ru le s, 1 2 6 - 1 2 7 p erfo rm a n ce m a n a g e m e n t and ev alu a tio n . 1 3 1 -1 3 4

P ric e , 1 8 9 - 1 9 0 Privacy. 1 2 9 -1 3 0 a d v ic e , 130

130-145 p o r n o g r a p h y a n d o b s c e n i t y , 142 R e p o r te r s C o m m i t t e e for F r e e d o m o f the P re s s . 145, 158 R esearch, 2 1 6 -2 6 0

c h il d r e n a n d . 130. 146. 147, 1 5 4 - 1 5 6 d e fi n it io n , 129 f o u r a s p e c t s . 129 o n li n e . I 30 w ir e a n d n o n w ir e , 129 P r o a c t iv e d e c i s i o n s . 5 - 6

a d v e r t is i n g r e s e a r c h /s tu d i e s . 243 sources, 2 3 5 -2 3 6 applied, 2 2 3 -2 3 4 audience. 2 2 4 -2 4 3 b ro ad cast, 2 3 3 -2 3 4 , 2 3 8 -2 4 0 In t e rn e t . 23 4 prin t. 23 4 c ir c u la t io n s t u d ie s , 2 34 re a d e r s h ip s tu d ie s . 2 3 4 . 242

P ro d uct c o m p l e m e n t , 191 s u b s tit u te . 1 9 0 -1 9 1

P s y c h o g r a p h i c s . 189. 2 0 0 - 2 0 1 . 2 0 2 . 2 0 8 . 2 2 4 - 2 2 5 . 242

sources, 2 3 7 -2 3 8 basic, 2 2 3 -2 2 4 c a u s a l . 2 2 0 - 2 2 1 . 2 2 3 . 2 44

P u b li c R e l a t i o n s S o c ie t y o f A m e r i c a (P R S A ). 147

c o n t e n t a n a ly s is , 22 2 d a ta a n a ly s is , 2 19

te c h n o l o g y as, 1 0 7 -1 12 P r o d u c t d if f e r e n t ia t io n , 1 9 6 - 1 9 8

d a ta c o l l e c ti o n . 2 1 9 . 2 22

Q Q u a lit a ti v e , 221 Q u a n t i t a t i v e , 22 2

d e s c r ip ti v e , 2 2 0 - 2 2 1 , 2 22 d e s i g n , 2 1 8 , 2 1 9 - 2 2 0 , 2 2 1 - 2 2 3 . 245 e x p e r i m e n t a l . 223 e x p lo r a to r y , 2 2 0 - 2 2 1

field e x p e r i m e n t s . 223 R R ad io

g c n e r a l iz a b i li ty . 2 20 m arketing research p ro cess, 2 1 8 -2 1 9 m e d i a c o n te n t , 2 44

a u d i e n c e m e a s u r e m e n t a n d a n a ly s is , 231-234

o b je c t iv e , 218 prim ary. 218, 220. 2 3 4 -2 4 3

cases. 2 0 5 -2 1 5 c o n s o l i d a t i o n , 192, 194 m a r k e t g r o w t h tr e n d s , 1 8 8 - 1 8 9

q u a li ta t iv e , 2 2 1

departm ents. 8 0 - 8 1 d is tr i b u ti o n , 199 research sources. 2 3 8 -2 4 0

q u a n t i t a t i v e , 2 22 s u r v e y s , 222

R a d io A d v e r ti s in g B u r e a u . 25 8 R a d i o - T e l e v i s i o n N e w s D i r e c t o r s A s s o c i a tio n ( R T N D A ) . 146. 158

d e p t h in t e rv i e w , 2 2 1 , 222 fo c u s g r o u p s , 221

q u e s t i o n s , 2 1 8 . 221 re p o r t. 2 19 re lia b ility , 2 1 9 , 2 44 sam ples. 219. 2 2 2 -2 2 3

SUBJECT INDEX

secondary. 218, 220. 2 2 4 -2 3 4 sources a d v e r t is i n g re s e a r c h . 2 3 5 - 2 3 6 b ro ad cast research. 2 3 8 -2 4 0 g o v e r n m e n t s o u r c e s , 2 42 I n te rn e t re s e a r c h . 2 4 0 - 2 4 2 ou td o o r research , 2 4 0 -2 4 2 p r i n t re s e a r c h . 2 3 7 - 2 3 8 s ta g e s . 2 1 8 - 2 1 9 s y s te m a t ic , 2 1 8 v a lid ity , 2 1 9 . 2 2 3 . 24 4

T

T a m p a T r i b u n e , 257 T a rg e t m ark et or audience, 8 2 -8 3 . 2 0 0 -2 0 1 , 2 2 4 -2 3 4 ,2 4 2 T e a m s (see G r o u p s ) T eam b u ild in g . 8 5 -8 7 T e c h n o l o g y . 9 9 - 1 24 a c c e s s to d is trib u tio n c h a n n e l s , 1 9 9 - 2 0 0 approaches. 1 00-102 a doption process, 103-1 07 an d c o n tr o l, 1 0 0 - 1 0 2 , 103, 1 0 5 - 1 0 7 , 110, 113 a n d m e d i a m a n a g e r s . 1 18

v a r i a b le . 2 1 9 . 2 2 3 , 244 R e s tr u c tu r e . 2 9 7 - 2 9 8 R e te n t io n . 3 6 - 3 7 . 4 2 . 6 2 - 6 3 R e tu rn o n i n v e s tm e n t, 204 R evenue, 115-116, 1 9 0 ,2 0 3 -2 0 5 R is k . 4 R o p e r A S W , 244

S S afe H a rb o r P ro gram for child ren online, 147. 155 S a fe ty (sec E m p l o y e e H e a lth