New Feature: Forecast Cost now includes Actuals

Release date: June 12, 2023

A key benefit of media planning software is tracking costs and keeping media plans within budget.

MediaPlanHQ always provided tools to efficiently define budgets, and track costs / remaining budgets during the entire lifespan of your media plan.

The cost tracking and remaining budgets were always based on an algorithm that used the most up-to-date cost information including planned costs and invoiced costs.

In short, the forecast cost was calculated by splitting the cost on a daily basis, then doing the sum of the best cost information for each applicable date - either using the invoiced cost when defined or assuming planned pacing with the planned cost.

But, it didn't take the actual cost into consideration while the ad is running.

With this release, the algorithm now includes the actuals cost for an even more precise forecast cost.

Let's have a look at how it works...

Existing users: The feature should have limited impacts if you were not capturing actuals in your media plans other than aesthetics and user interface changes.

Understanding cost terms

First, let's review the different cost terms used in MediaPlanHQ.

The system tracks multiple cost information that is defined at different times of your media planning workflow in order to help you track expenses, highlight discrepancies, and stay within budget.  They are:

Budget Cost	This is the budget you set for the media plan per organization.  It is the high-level baseline with which you'll monitor your overall expenses to make sure you stay within budget.
Planned Cost	This is the cost you set while planning your media insertions prior to their run dates. Normally, the planned cost should not exceed the budgeted cost.
Actual Cost	This is the cost reported by the media supplier during or after the media insertion run dates.
Invoiced Cost	This is the cost that appears on the invoice you receive from the media supplier for the media insertion. Normally, the invoiced cost should be equal to the actual cost.
Forecast Cost	The forecast cost is a dynamic cost computed based on an algorithm that splits cost information into daily chunks and sums the best cost information available.  It represents the most accurate cost for a media insertion at a given time.   It uses the Invoiced cost when available and the Invoice status has the "Approved" flag; Otherwise, It uses the Actual cost when available; Otherwise, It uses the Planned cost when the Media insertion status has the "Expense" flag. Otherwise,  It is undefined. It is used by the system to sum expenses and track remaining budgets.

Defining actual cost

As a refresher, you can capture the actual costs on any given media insertion by clicking the "Update actuals" button:

Note that the "Update actuals" is available in multiple places in the system.

At the moment, you have to manually input or import - the system does not have integrations with external ad servers to automatically fetch actuals.

This displays the "Update actuals" form:

The timeline granularity is DAY by default.  Notice that the grid displays a row for each applicable date of the media insertion with an input box to capture the actual net cost with the planned net cost.

You can match the timeline granularity based on how your ad servers provide the actuals information.   For example, if you capture actuals by weeks:

Let's assume the actual cost is higher than the planned cost.

Defining invoiced cost

Now, you expect a monthly invoice from the media supplier for the media insertion.  When you receive the May invoice, you find the expected invoice:

And capture the invoice information:

Notice you have the planned cost and actual cost information to help validate the invoiced cost. 

Let's assume the invoice cost is higher than the actual cost.

Understanding the cost details

The cost details tab in the media insertion view displays the cost information about the media insertion:

The cost details section (#1) displays details about the planned cost (#2), the actual cost (#3), and the invoice cost (#4).  These are based on raw numbers that you've entered in the system without alteration either through the media insertion form, the update actuals form, or the invoice form.

The actual progress (#5) and invoiced progress (#6) represent the percentage of the running dates covered by the given cost to date. (0% = No cost entered, 100% = All running dates have cost)

The cost forecast section (#7) displays an overview of how the forecast cost (#11) is calculated to represent the most accurate cost computed based on the planned cost (#10), actual cost (#9), and invoiced cost (#8) entered in the system to date.

Understanding cost calculations

The cost calculation popover when you mouse over a forecast cost.  It gives additional information about how the forecast cost was calculated:

The system organizes the cost calculation by the period following the invoice frequency.  For each period, it highlights with a light green background the cost that is used for the forecast cost.

• (#1) For the period 5/1/2023-5/31/2023,
  • The system uses the inputed approved invoiced cost (#3) of 4,500$.
• (#2) For the period 6/1/2023-6/30/2023
  • The system uses inputed actual costs (#4) of 1,492.84$
    • Week 5/29/2023 = 950.00$ = 7 days @ 135.71 x 4 days (6/1, 6/2, 6/3, 6/4) = 542.84$
    • Week 6/5/2023 = 950.00$
  • The system uses inputed planned cost (#5) of 1,900$
    • 6,100$ = 61 days @ 100$ x 19 days (6/12 - 6/30) = 1,900$

Thus, the forecast cost = 4,500$ (from invoiced cost) + 1,492.84$ (from actual cost) + 1,900$ (from planned cost) = 7,892.84$ (#6)

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That's it ! We hope you'll enjoy the new Forecast Cost now includes Actuals feature. 

Give it a try and let us know what you think !

As always, don't hesitate to send us your great feedback or other ideas for new features !