Indrani Sen: CPT ke peechhe kya hai?

By Indrani Sen

Ever since Shashi Sinha spoke about adopting CPT (Cost per thousand) as a measure of TV buying instead of CPRP (cost per rating point) at the Advertising Club’s annual Media Review, the old debate about CPT versus CPRP has opened up. A week back, I read on the net the views expressed by some stalwarts of our industry, most preferring to continue with CPRP over CPT for TV buying. The TV Channels showed preference for shifting to CPT which they feel would capture the incremental viewer base (http://www.exchange4media.com/tv/cprp-vs-cptwhats-the-need-of-the-hour_66504.html ).

Most of the debates are happening assuming that CPT stands simply for “advertising cost pe thousand target audience” and with the knowledge that internationally CPT is the more accepted currency for TV buying. Collective opinion in the industry is that shifting from CPRP to CPT will inflate the TV advertising rates. Shashi Sinha said in an interview with Admatazz: “There is a fallacy in everyone’s mind that when you move from CPRP to CPT, rates will go up.” (http://www.admatazz.in/2016/10/20/interview-with-shashi-sinha-ceo-ipg-mediabrands-india/). According to Sinha, rates are governed by various supply and demand factors in the market place and shifting from CPRP to CPT will not affect them.

The definition of CPT is commonly known as “cost per thousand target audience” and most books on media planning still promote that definition. A doubt had crept into my mind when the CPT vs. CPRP debate had first began in 2010. In the age of rapidly growing digital media with CPM or the cost per mille (thousand) impressions on the web as one of the measures for online media buying, why should the digitally advanced nations use a simple measure like “cost per thousand target audience” irrespective of their TV viewing behaviour as the measure for TV buying?

Subsequent search on the Net revealed that Broadcasters’ Audience Research Board (BARB), UK defined CPT as “The cost of one thousand commercial impacts for a target audience. Cost-per-thousand (CPT) is used when purchasing and measuring the efficiency of advertising campaigns”. It seemed to me that the definition of CPT was reinvented by BARB in order to estimate impact of TV advertising across multiple screens and to make the performance of TV advertising comparable with the performance of online advertising. Sinha mentioned in his interview: “CPT helps because you can compare…today you can do inter media comparison digital, print, television with CPT…..we are already doing it, we are plugging in CPTs…our clients are seeing how the integrated model of TV and print work together.”

The renewed debate reminded me about my old search findings. I checked and found that the definition of CPT still remains the same (http://www.barb.co.uk/about-us/glossary/) in BARB Glossary. The “cost per thousand target audience” and the “cost of one thousand commercial impacts for a target audience” are two totally different measures. The BARB definition of CPT will not bring joy to the TV channels as it will still be linked with TVRs without which it will not be possible to calculate cost of thousand commercial impacts for a target audience.

While checking the BARB Glossary, I came across an interesting article posted in October 2015 (https://www.thinkbox.tv/Getting-on-TV/Useful-resources/How-to-calculate-CPTs) on www.thinkbox.tv which is the marketing body for commercial TV in UK. The article takes the reader through the formulae required to calculate the cost of airtime and how many Television Ratings the advertiser can afford to buy, etc. The equation used for calculating CPT is CPT = Budget/universe/TVRs x 100,000 in that article.

I humbly request the multinational media agencies to share the definition and calculation of CPT which they are using currently in their in-house media planning models with the industry at large. Before we think of shifting from CPRP to CPT for TV buying, the industry bodies need to agree on a new definition of CPT in keeping with the international practices. BARC can also take the lead in promoting the new concept of CPT though the current BARC Glossary of Terms does not include either CPT or CPRP definitions. Finally, I agree with Sinha that Indian marketing and advertising industry should replace CPRP with CPT as a measure for TV planning and buying, but arguably we will have to use the new avatar of CPT.

Indrani Sen is a media services veteran, having worked with JWT, later Mindshare and then with Emami. In recent years, she is an independent consultant and academic. She is Adjunct Professor incharge of the Media Management programme at the Symbiosis Institute of Media & Communication, Pune. The views expressed here are her own.