Posted in Finance, Accounting and Economics Terms, Total Reads: 337
Definition: AAAA Spot Contract
AAAA Spot Contract is a written documentation between an advertising agency and a television/radio station. The primary purpose of this contract is to buy radio or television spots for advertising purposes.
Spot Contract is a contract regarding trading or exchange of commodities, securities or currency for settlement on the spot date which is normally after the trade date. Usually spot date is two business days after the trade date.
AAAA stands for American Association for Advertising Agencies.
The AAAA contract consists of important factors such as details of both parties, details of the purchase, the date and time of airing of the spots, period of time of airing the advertisement (daily, weekly, monthly) and the finances incurred to the advertiser.
Example: If we are the advertiser and we want to buy an air time slot for 30seconds for our advertisement. Instead of buying overall time duration in an established network like Sony, we decide to purchase individual spots on different network channels like colors, Zee, etc. For this, we need to enter into AAAA Spot contract.
AAAA Spot Contract is more time consuming as compared to buying spots on all stations affiliated to a network, it is more targeted in a particular geographical region. The standard components of the AAAA spot contract makes it easier for the parties to process the contract.