A Forecaster's Journey: Challenges and Frustrations in a Media Company
Layton W. Franko · The Journal of Business Forecasting Methods & Systems · 2003
Forecasting media expenditures provide greater career challenges than consumer product forecasting ... top of the line media expenditure (advertising expenditure in magazines, network TV, etc.) can be forecasted fairly well using standard Econometric techniques ... individual product forecasting by event or by daypart (time of day) is done by knowing the classification of the business of an advertiser. I had a long career as a Forecaster for a number of media companies - ABC (the old American Broadcasting Company, now a part of Disney), Reuben H. Donnelley (the sales agent for the Yellow Pages) and McCann Erickson (the largest international advertising agency in the world). I can't say that I planned my career that way; it just so happened! T got started in a typical manner like many other guys who were raised in New York City. I went straight from undergraduate school to an MBA program, then a 6 months active reserve obligation, and then into the labor force. I knew at that time that I liked working with numbers but not much else. I had a few short-lived jobs mainly in consumer product companies where I was extensively involved in forecasting. These employers included Philip Morris, Schaefer Brewing, and J. C. Penney Company. MANAGEMENT'S VIEW ABOUT A FORECASTER My problem with these jobs were that they did not offer me enough of a challenge. Forecasting consumer packaged goods sales involved mainly fitting curves to lines and making projections based on that. I became an expert in techniques such as Box-Jenkins, Winter's Method of Exponential Smoothing and moving averages. I wrestled with such problems as how successful various promotions were for the Philip Morris Blade Division; the success of various cigarette products in test markets; and for Schaefer, forecasting as well as production problems, which were tied into various linear programming applications. My J. C. Penney position was in operations research and computer modeling. One thing I did not like about this job was that I was viewed as an extension of the computer, and not as a part of corporate management. HONING UP THE SKILL: A KEY TO SUCCESS I took the Donnelley job, not so much because I liked media, but rather because it was something different, something that I could build on. I was involved with both market research and economics. I provided forecasts for various Donnelley sales areas. For instance, they wanted to know the sales potential of the Bronx and Brooklyn areas, and for that I built models to give them that information. In fact, most of the models were already built by my boss. I developed a few, but I largely updated his work. I liked the potential for that type of forecasting! It offered me more challenges than the straight math techniques, which I had been used to, and felt that the experience of doing both Economic Analysis and sales forecasting would really enhance my career. I wanted to learn more about Economics and Econometrics, and for that I enrolled in the Ph.D. program at the New School University. I received a Ph.D. from the school 11 years later in Economics with concentrations in Industrial Organization and Econometrics. POLITICS: LEARNED TO LIVE WITH IT Eventually I got a position with ABC, and started defining my career. I wanted that position because I became interested in media, both as a result of my time at Donnelley and from my understanding that CBS had a formidable economics department. During my interview at ABC, my future boss added one caveat in his description of ABC. We work in a highly political environment. At the time, I didn't know what he meant or how it would affect me and my job, but soon after I learned. Media advertising is pretty much a zero sum game. Oh sure, advertising budgets usually go up on a year-to-year basis but the increase is usually single digit, and then the budget gets divided up among various media by the advertising agencies. Some media are in their growth phase, others are mature, whereas others are in a decline. …