How TV Advertising Works
The Basics
Television advertising is a very important aspect of the television industry. These advertisements typically pay for the cost of the programming you are watching, as in situations with major networks the television programs are being provided to you for free, rather than by a monthly subscription charge (cable, satellite). Time slots for advertisements are sold by television networks for the highest possible price. In an ideal situation, the price advertisers pay for commercials will cover the cost to produce the show and still make enough money for the network to profit off of it.
Ratings
Ratings play a big part in television advertising. Statistics collected by the Nielsen Company show exactly what types of people are watching what shows. The higher the ratings (the more people watching) for a particular show, the higher the price a network will be able to charge for advertisement space during commercials.
Demographics
A demographic is a general description of the type of person who watches a particular show. This includes age, gender and race. For example, it is understood that a person who watches "Monday Night Football" may not be the same type of person who watches "60 Minutes." The Nielsen Company's ratings track the demographics of each show's viewers, so advertisers know exactly what shows reach the market that will purchase their particular products.
Sweeps
The price for advertisement space is typically set six months before an advertisement ever airs. These two time periods are in May and November. Networks want to get the highest possible ratings for their shows during these two months so that they can charge advertisers the highest possible prices for the ad space. These two time periods are called "Sweeps" months, as they are typically the times when shows pull out all the stops with their plotlines to draw the biggest ratings.
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