Key Capabilities of Media Revenue Management:
- Combines time series demand forecasting and optimization
- Dynamically updates data
Media companies face many challenges in realizing the best return on their primary revenue-generating asset – commercial spots. Two key mechanisms for addressing these challenges are pricing and the placement of the commercial spots. Pricing is the means by which media companies can adapt to the supply and demand fluctuations of the marketplace. Prices need to be constantly monitored and adjusted over months of future inventory and thousands of program air dates.
Placement of commercial spots entails the complex task of determining the appropriate combination of advertising spots to sell to clients. It is a daunting and time-consuming process to select spots while trying to satisfy all of the client’s mix, flighting and budget requirements. Factor in the competing requirements of your other clients, as well as your own corporate objectives, and you have a problem that is well beyond the capabilities of a human being to solve optimally.
Media Revenue Management combines time series demand forecasting and optimization processes to equip pricing analysts with the ability to manage the monitoring and adjusting of pricing and products for thousands of future program air dates. The forecasts are dynamically updated with data from the latest program air dates to keep the forecasts synchronized with current trends. The benefits of this solution include reacting to spikes of demand to increase prices (or restrict availability) before sellout occurs or, alternatively, to highlight early in the booking cycle those program air dates for which additional sales emphasis is required to avoid last minute fire sales. Finally, with a better managed mix of inventory sold throughout the sales cycle, yield is maintained even on late booking proposals.
