How Much Does Television Advertising Really Cost?
The cost of running television commercials varies widely, depending on if your ad runs on local stations or national networks. The real cost of your ad can be calculated by tracking how much it costs to convert a prospect into a client. Add the total cost of production and the number of slots in which your ad runs, then divide that amount by the number of customers you converted during that timeframe to determine the average conversion cost.
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Production costs to create a commercial range in price from free to hundreds of thousands of dollars. According to Entrepreneur, some independent television stations will produce your ad for free if you sign up for a minimum of three months of commercial spots. Local television stations typically charge from $200 to $1,500 to create a 30-second commercial. National commercials produced by an advertising agency cost far more, averaging $342,000 for a 30-second spot in 2008, according to the American Association of Advertising Agencies.
National Spots
National advertising commercials are beyond the budget of most small companies, especially during popular televised events such as the Super Bowl. According to Time, the 30-second commercials that ran during the 2011 Super Bowl cost an average of $3.5 million per spot. Popular television programs such as American Idol pull in approximately $475,000 per 30-second spot, according to AdWeek. Even less popular nationally televised programs, says AdWeek, often cost in excess of $100,000 for a 30-second spot in 2011.
Local Spots
Most television stations offer two minutes of local advertising per hour, giving small businesses a more affordable way use TV ads as part of their marketing strategy. Rates vary depending on the time of day and year as well as your location. If your target market is most likely to see your ad during the local news at noon, you may pay anywhere from $200 to $1,500 for a 30-second spot during that time, says Entrepreneur. Commercials that run between the prime viewing hours between 6 to 7 p.m. cost the most.
Cutting Costs
To cut costs, make sure you know the programs your target market is most likely to watch. Figure out which days they watch television the most. For example, working adults would more likely watch television at nights or on weekends than during the day. Negotiate the best spot prices by signing a bi-annual or annual contract with the television stations in your local market. Ask for free production of your ad before you sign up for a long-term contract. To keep costs down, run a few 15-second commercials for branding purposes and use 30-second ads to convince prospects to take action.
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