Get typical advertising costs and price ranges for advertising production and buying media space for TV, radio, magazines, newspapers, online, mobile cell phones, outdoor billboards, movie theater pre-show, Yellow Pages and internet search ads.
Know this: These are ballpark cost estimates to help you with budgeting to know what you can (and can’t) afford. You’ll want to work with a media planner, media buying agency or talk to the media sellers directly to get actual costs.
Costs for advertising:
- Creating the ad concept/idea – fees or commission to an ad agency or freelancer who creates (invents) the ad and oversees it’s creation and production
- Ad Testing (optional) – best to do the ad testing of ad concepts
- Ad production – the costs associated with creating a final ad to be published/aired
- Media placement costs – also called “ad space”. These generally represent 80% or more of a total ad budget.
Ad creation costs
Costs for ad creation and production vary depending on what type of ad you want to create (TV, online, print, etc.). Advertising creation costs also vary based on whether you create the ad yourself, have a media publisher/station create it for you if you buy ad space with them, or if you hire an ad agency or freelancers to create the ad for you.
Media Costs generally represent 80% or more of your advertising budget.
Know this: Buying ad media space is like buying real estate. The prices change constantly based on supply/demand, and media rates are always negotiable. Real estate in the best neighborhood/location demands the best price; and, similarly, high-impact media properties with the best placement cost the most. Media buyers are like real estate agents, they know how to work the system and help you negotiate a good deal.
To give you an idea of what things costs, here are some ballpark price ranges for the cost of placing one ad.
Know this: Obviously you’ll need to invest in more than one ad. Advertising is discounted based on the amount of ad space you buy from a particular media seller, so these prices for one ad are the highest prices and most advertisers don’t pay these rates. They negotiate for lower rates. You can do this negotiation yourself or hire a professional media buyer to do this negotiating for you.
Television Advertising Costs
Television ads are purchased based on supply and demand. Everything is negotiated. National and local networks require advertisers to purchase a package of ads. The media sellers bundle popular shows with programs that most advertisers don’t want to buy. The advertisers who spend the most and agree to longer term contracts get the best pricing and choice of programs.
Network TV Costs Media Costs
One 30-second TV ad on the Super Bowl can cost $3 million; a 30-second spot on a network prime time show can range from $100,000 – $700,000 depending on the popularity (i.e., rating) of the show; an ad on a network daytime show can cost as little as $50,000.
The price you pay depends on the package deal that your media agency can negotiate for you. It varies.
You can save about 20-25% if you buy during what’s called the TV Upfront (pre-season), but this requires a commitment of funding about six months in advance.
Cable TV Media Costs
Cable TV is usually less expensive than Network TV, and, therefore, can be more cost effective. As cable networks gain popularity, demand for Cable TV has grown in recent years. This makes the Cable TV marketplace more competitive. It would be wise to plan ahead, for better pricing and better inventory.
Spot TV Media Costs
These costs vary significantly depending on the city/metro area you are buying ads for. If you bought ads in the Top Ten U.S. markets (cities and surrounding suburban areas), an estimate of the average cost per for a 30-second spot might be $100,000 or more for an ad running in prime time; $35,000 or more for ads running during early news or late night programming; and $12,000 or more for daytime shows. And prices would be higher if you wanted to select particular shows or were only buying in the most expensive markets, not averaging the costs across the Top 10 markets.
Google TV (a media buying service)
Google offers an inexpensive way of buying Cable TV advertising via a price-bidding process similar to how they sell their paid search ads. Google’s Cable TV inventory tends to be with smaller Cable TV networks; however, Google offers measurement tracking capabilities similar to online advertising, which provides more insights into how viewers perceive/respond to ads.
Production costs for TV ads
National $250,000 – $1 million or more, depending on the length of the spot, production quality, talent used, location, etc.
Radio Advertising Costs
$1,400 per 30-second advertising spot might be an average cost per spot if you bought ads on many radio stations in New York and in a smaller city like Boise, about $25 per spot. That cost estimate assumes you are buying ads for ROS (run of station), not during a particular show or during more expensive drive time slots. Obviously you wouldn’t buy just one spot.
TIP: You can reduce your media cost by running a live, announcer-read ad for 10-15 seconds. Another advantage of this approach is that you don’t have to produce a radio spot, saving you time and production money.
Like TV, radio advertising is purchased based on supply and demand. Networks sell bundles and getting ad time on shows for the most popular radio hosts may not be possible since large national advertisers tend to have “first dibs.”
Costs to produce radio ads:
$15,000 – $50,000, depending on length, production quality, talents, etc. However, having your ad read live by a DJ has practically no production cost at all.
Newspaper Advertising Costs
One full-page, 4-color ad in the Wall Street Journal (U.S. edition) for a non-contract rate (no volume discount) is $286,000; $224,000 for a black and white ad; and $75,000 for a 1/3 page black and white ad.
To run a full-page ad in The Portland Oregonian in the Sunday comics, the “rate card” (price) is $25,000; it costs $7,300 for a 1/4 page ad.
Local papers in a small town are much less expensive since they have a much smaller circulation (subscribers).
Newspapers make it complex to buy ad space because they offer different prices for local versus national advertisers, and offer different rates for co-op ads (ad costs split between parties, such as a manufacturer and their wholesalers and retailers) and national advertisers by industry. And since newspaper advertising is down, the papers are all saying “call for the best prices.” They want to talk to you and make a sale, not make their rates easy to find.
Production costs for newspaper ads can be done for free by small local papers if their in-house design team creates and produces the ad. For national newspapers like The Wall Street Journal, production costs may range from $20,000 – $100,000, depending on the ad size, visual complexity, photo shoots, etc.
Magazine Advertising Costs
One insertion in Time magazine’s national edition costs $187,000 for a black and white ad and $287,000 for a 4-color ad. A smaller 1/3 column ad costs $84,000 for a black and white ad or $129,000 for a 4-color ad. You have to call their sales team for regional rates.
In a niche magazine like Portland Bride & Groom, their rate card for one insertion for a full page ad is $3,700, or $1,650 for a smaller 1/4 page ad.
A full page ad in Inc Magazine with a circulation of 700,000 readers sells for $74,200 for 1 page/4 color. The cost to run a full page 4 color ad in the national edition of the Wall Street Journal is $285,974
SRDS (Standard Rates and Data) is a helpful resource you may find at your local library that consolidates print ad rates.
Magazines publish their rate cards (prices) annually.
Production costs for magazine ads may range from $20,000 – $100,000, depending on the ad size, visual complexity, photo shoots, etc. A local magazine may offer to cover production costs for an ad by their internal marketing/design team with the media purchase of ad space. They will only offer this if you are not working with an agency because they don’t want to compete with an agency.
Mobile / Cell Phone Advertising Costs
The cost for ads on cell phones may range between $5 to $10 CPM (cost per thousand). Mobile ad networks offer pricing as low as 25 cents CPC (cost per clicks). People have to click to accept ads on their phones so you won’t be advertising to everyone.
Mobile advertising can be a very cost efficient medium to drive a desired action on the mobile device, such as downloading an application.
Production costs for mobile ads typically is less than $1,000 for mobile banners. Some mobile media vendors will offer to develop a WAP (wireless application protocol) landing page as part of the mobile media package. If not, you may need to spend $2,000 – $7,000 to develop your WAP landing page.
Movie Theater Advertising Media Costs
National cinema advertising can cost 4-8 times more than national Cable TV on average, in terms of CPM (cost per thousand impressions) or CPP (cost per point).
Local cinema advertising may be much less expensive. Contact your local cinema companies for more information.
Production costs for movie theater advertising varies but is usually built in with media cost. TV spots can also be run at the theater for no additional production cost. Many times companies will produce a longer version of a TV commercial and use that in movie theaters.
Outdoor Billboards Media Costs
In San Diego, to reach the general market of adults over 18 years of age, a large outdoor media company lists rates for a poster billboard of $58,000 for four weeks with a 70 GRP (gross rating point, or size of the audience reached) and a cost per board (which the industry calls facing) of $750 with a CPM (cost per thousand) of $1.36.
Rates are higher to select specific billboard locations and these are often already reserved for major advertisers who spend the most in outdoor advertising so they are able to secure these premium placements.
In San Diego, targeting billboards that reach Spanish-speakers, the cost is $17,000 for a 4-week buy and $750 per facing.
Prices are much higher in major metros like New York and lower in smaller cities.
The companies that sell billboard space post their rates online and change them based on supply and demand.
Production costs for outdoor advertising varies and is usually built in with the media cost.
ClearChanneloutdoor.com is a helpful and fast resource to check prices. They’re one of the “big three” outdoor billboard ad space sellers nationwide.
Online Advertising Costs
Online advertising costs vary widely. Ads are sold either CPM (which stands for cost per 1,000 ad views) or CPC (cost-per-click). We asked media buyers who buy online advertising what the typical rates are. Their comments are in italics.
Online ads to reach consumers:
Can cost as little as 50 cents per thousand impressions if you buy remnant ad space through an ad network. Ad networks sell ads from many different online publishers. You may not be able to determine where your ads appear.
Ads on Yahoo and AOL cost in the $7 range
Online ads to reach a business target audience:
Range from $10 to $40 CPM (cost per thousand ad views) for a high profile site.
Depends on the site, but most sites reaching micro-small business people seem to be in the $8 – $12 range for run of site banners. Manta is around $10. Sites like American Express charge a lot more ($40CPM) due to the additional data they have.
I would estimate if you have 1 million visitors to be somewhere between a $35-$50 CPM, which means it would cost $35k-$50k. But the pricing should be adjusted based on response rates. So, if people are less likely to engage with an ad than other competitive ad products, the cost would need to be adjusted accordingly.
Online banner costs vary by the type of banners or by banner sizes/placement.
A homepage takeover on a major portal can cost over $1 million per day.
Online video ads have gained popularity in recent years as more and more advertisers are using video as an alternative to TV. Like banner ads, you can buy video placements either based on a CPM basis directly with online media vendors, or a CPC basis with video ad networks.
Online ad buys are also subject to additional ad serving costs, which can be higher for rich media/video ads and for a higher number of impressions served.
Cost range for production costs for online advertising:
$2,000 – $25,000 for standard flash banners, dependent on animation complexity
$25,000 – $75,000 for rich media banners. The high end of the range is usually for homepage takeovers on major online sites.
Online ads should have a ad landing pages created to maximize conversion. Those typically cost $20,000 – $200,000, depending on the complexity of the site. Note: These costs are for production only. Creative agencies also charge a creative fee for concept and designing ad landing pages.
Costs to buy ads on an email list for an email newsletter
To reach small business customers media buyers said:
Prices for sponsoring an email have a whole lot to do with the quality, whether it’s a double opt in, etc. Small business lists can have a $20 CPM or a $100 CPM. Generally, links in emails go for $1-5 CPM or they have a CPC model of $.50 – $5…again, depending on the quality of the list. Generally smaller, DR (direct response) advertiser that would take this opportunity.
A really exclusive email list could be $100M (thousand). Thus, $100,000. a more general email newsletter to small business could be more like $40/M ($40,000). But for the solo sponsorship it should be on the higher side, depending upon what kind of visibility the sponsor gets.
Search Advertising Costs
Search ads are the ads that appear on Google and other search engines on the right-hand side and top of the search results. You pay only when someone clicks on the ad to go to your website. Ads rates are set by the market bidding on the terms.
Costs vary widely based on the search words or terms you want to place ads on.
You can buy “long tail” (longer search phrases that don’t have as many people searching for these terms) for 50 cents an ad. Popular “head terms” that a lot of advertisers are competing for can cost $17 or more.
Classified Advertising Costs
For B2B publications lowest cost for one ad is $136 plus processing fees. That’s for only 12 words.
A good source to quickly get costs for multiple magazines is RPI Classifieds. They represent many magazines and handle their classified ads
Yellow Page Advertising
Ads in printed Yellow Pages books typically cost on average $2,500 a year.
How much do you need to spend?
Know this: A little advertising doesn’t work. Major advertisers who invest in expensive research tracking studies to understand the recall and impact of their advertising in market know that without adequate reach and frequency levels and enough media weight (dollars spent), the investment in advertising just doesn’t work.
Traditional advertising (TV, radio, print, billboards) is purchased based on reach and frequency levels
Reach is the number of unduplicated households or people exposed to a program, group of programs, or an advertiser’s schedule over a specific time period. Think of reach as the TV and radio equivalent of circulation for print.
Frequency is the average number of times people have an opportunity to see/hear your ad message during that time period. Remember, this is opportunity to see, not a guarantee that people actually will see your ad.
Know this: The industry standard for minimum advertising effectiveness levels is reaching at least 50% of the target audience at least three times during a four-week period. Media buyers also use GRPs (gross rating points) as a measure of media weight, in lieu of reach/frequency.
From our experience: Many small businesses don’t invest enough money to reach minimum levels and are frustrated that the advertising didn’t work. Business owners and managers say things like, “To date we’ve done several random email, web, and mobile ad campaigns, but I need start driving a more consistent awareness program that I can then build the in-store activities around.”
Figuring out what you can afford
You need to decide if you have enough money to reach enough people enough times to make an impact. That’s best done through what’s called media scenario planning, where a media planner prices options and trade-offs of using different types of media, different combinations of media and tells you what it costs to reach different target audience groups.
If you can’t afford the “big ad plan,” then consider:
- Focusing your advertising to a smaller geographic area, to be able to afford adequate reach/frequency levels.
- Narrowing the target audience. Instead of reaching all women, maybe you focus on a subset of women who are most likely to buy, like moms with young children.
- Identifying particular shows, magazines, and websites that your target audience watches/listens to/views and developing a plan to reach those people with consistent frequency so your ads and messages are recalled.
- Using other marketing approaches like email marketing, direct mail marketing, etc.
Key media terms you’ll need to understand
GRPs stands for gross ratings points.
Reach x Frequency = Gross Rating Points. Gross Rating Points (GRPs) is a shorthand measure media planners use. It’s the sum of individual program ratings without regard to duplication. For example, 10 announcements each with a 10 rating would produce a total of 100 GRPs.
GRP counts the total exposures of the ad. Reach counts unique people exposed to an ad. GRP double-counts people who see ads multiple times.
Cost-per-Rating Point (CPP) is the cost of reaching one percent of the target.
Targeted CPP is the cost of reaching only the target audience, not others who are viewers/readers/listeners.
Cost Per Thousand (CPM) is the cost of reaching 1,000 homes or individuals with a specific advertising message. CPM is a standard advertising measure to compare the relative cost efficiency of different programs, stations, or media.
Things to know about media buying
Know this: Everything is negotiable. Rate sheets, rate cards and the information from third party sources on advertising media costs are what companies hope to charge. Most advertisers negotiate lower rates. Major advertisers, through their media buying agencies, often negotiate rates 30–50% lower than published rates. But it’s all a very secretive and supply-demand driven process. And prices can increase 100% in one week.
Media costs vary based on a number of variables:
- Where the ads are running (nationally, regionally, locally)
- Target audience (who you want to reach)
- What type of advertising you choose (TV, radio, online, search, print, etc.)
- How long your advertising will run
- Reach and frequency levels and GRPs (gross rating points) for TV, radio and print advertising. Online, search and billboard advertising use different criteria.
- Supply and demand from other advertisers
- How well you or your media buyer negotiate a deal
You can negotiate:
- Guarantees, that the media seller will guarantee a certain number of people hear/see/view your ad (based on a third-party auditing source measuring this) and the media seller will give you, the media buyer, make-goods (free ads) if they don’t meet their guarantees.
- Value-adds, the ad agencies’ equivalent of “freebies.” It can be a 1/3 page ad with the purchase of six full-page ads; free merchandise; concert tickets; special promotions. This is where you and the ad sales people can be very creative to come up with ideas.
From our experience: It’s worth it to hire a media planner with access to third-party research who can do what’s called “media scenario planning” to develop a good-better-best media plan for you to your intended target audience. You can hire someone on a per-project basis to do this work for you, paying them an hourly rate of $50 to more than $100 an hour (depending on their experience), or by setting a fixed per-project cost that you work out with them.
How to get specific ad media rates
Unfortunately, there is no free source for all the media information you need to calculate reach/frequency and GRP levels. Media planners and agencies pay thousands of dollars for third-party sources and spend a lot of time calling media sellers to get up-to-date rates.
To find media costs out yourself:
For TV and radio you’ll need to contact each individual TV and radio station or networks of stations. Most don’t post their prices online because they want you to call so they can set you up with a sales rep who will sell you on their station.
For print ad rates, most publications post media kits on their websites. Some kits include rate cards; others require you to call to get prices. SRDS is a company that sells books and tools that media buyers pay for that consolidates print ad rates. See their website at next.srds.com. The individual cost for an individual to buy one of their reference books is $695 (too high for a small business generally). Check your local library to see if they subscribe.
For outdoor billboard advertising, you’ll need to contact the different billboard sellers who sell space in the cities/metro areas you’re interested in. Check out www.clearchannel.com, which is the best and fastest source to get prices.
For costs for online and search advertising, you’ll need to contact each site you’re interested in or buy through an ad network that acts as a broker between advertisers and web publishers. The ad networks connect sites that want to sell ad space with advertisers and agencies that want to reach potential customers. The networks stitch together ad space from many small websites as well as from the less visited pages of large sites that otherwise go unsold. Through the networks, advertisers can reach audiences comparable in size to those at the largest websites. And they often do so at a fraction of the cost of ads on major sites’ most prominent pages.
From our experience: It’s a very time-consuming process to gather up-to-date information on ad rates if you do this yourself, because you need to contact each individual media seller. A media buyer or agency with access to the third-party tools will be able to gather and consolidate this information. We’d recommend hiring a media planner or agency that can do this work. They can be paid by the media space sellers (TV and radio stations, etc.) through buying media at wholesale, and then marking it up 15% to you the advertiser. Or you can negotiate a per-project rate.