Glossary: DRTV

grazing

Same as channel surfing.

gross buy

The total amount paid by an agency client for media time. It is the sum of the net buy (amount paid to the media outlet) plus the agency commission.

gross profit

On an individual product, refers to the dollar figure derived from subtracting COG from average retail (or wholesale) price. If a product has a COG of $25 and retails for $100, its single-piece gross profit is $75. For pro forma calculations, the gross profit is the retail price less COG and other direct marketing costs, not including media expenses.

gross profit margin

Quoted as a percentage and calculated by dividing the product’s single-piece gross profit by the product’s retail price. For example a product with COG of $25, a gross profit of $75 and a retail price of $100, has a gross profit margin of 75 percent.

gross rating points (GRPs)

Generally not used by DRTV media buyers, GRPs represent the number of rating points, in aggregate, that a media campaign will generate. Traditional spot advertisers use GRPs as a campaign goal. For example, 150 GRPs means that a specific commercial over the life of its run in a local TV market will accrue 150 total rating points of a targeted demographic group. If the spot runs 15 times during two weeks in programs with an average 10 rating, it will achieve a GRP of 150. This is not an unduplicated audience. Reach (x) Frequency = GRPs.

guaranteed CPO

A guarantee that a media agency gives its client that the cost per order for a specific infomercial telecast will not exceed a certain dollar amount. If the actual CPO does exceed the guaranteed CPO, the agency is responsible for paying the difference.