Because of its ability to capture large audiences in relatively small amounts of time, television has been a reliable venue for companies and businesses to advertise. With the increasing number of television stations and programming in local communities, businesses have the ability to advertise beyond their yellow pages and radio stations. However, the costs to advertise on television can be pricey and can vary depending on time slot, programming, commercial length, market and production costs.
The majority of local businesses cannot afford the $400,000 budget needed to produce and air a national commercial. Among the challenges for local business owners is to produce high-quality commercials with smaller budgets. An important consideration for small businesses is the CPM (cost per 1,000 viewers). This is based on the cost to air a commercial per viewer and the number of viewers. As an example, a local commercial that costs $50 to air seen by 5,000 viewers would have a CPM of $10. CPM can be used to compare broadcast station rates as opposed to commercial station rates.
According to Gaebler.com, a website that offers resources for entrepreneurs, local businesses can produce a commercial for $1,000. In fact, the website recommends making a deal with a local television studio to produce the commercial if they provide production services. Also, smaller production companies may be able to produce quality, inexpensive productions.
The industry standard for TV commercials is 30 seconds. In smaller markets (small towns with television stations) 30-second ads may run for as low as $35. According to Televisionadvertising.com, advertising in medium-sized marketing can cost $5 per 1,000 viewers, or between $50 and $60 for 10,000 viewers. Overnight time slots in some markets may be as low as $1 per spot.
Many of the major networks and channels such as NBC, CBS, MTV, and Nickelodeon have affiliate channels in local communities. As a result, businesses may increase their exposure and reputation on these channels for lower fees. Monthly fees on these channels can range from $1,500 to $2,500 for local cable networks such as MTV and CNN. Generally, monthly fees may include two 30-second slots per day, one during the day and one during primetime. However, determining the amount of slots and the details of a package can be difficult without consultation with the business. For local broadcast networks, fees may range from $2,500 to $5,000 monthly. Broadcast television reaches more viewers than cable and packages are sold according to the time of day (morning, daytime, primetime, late news). According to Cheap-tv-spots.com, packages can only be determined after meeting with the local business.