Radio Advertising Costs in Perspective

Written By

SMI Staff

Published On

Wednesday, Jan 15

The cost of radio advertising is one of the topics we get the most questions about. On the surface it seems like a simple question: “How much does it cost to advertise on the radio?” However, it’s actually a difficult question to answer. Here’s why: it’s the wrong question. Let me explain.

First of all, there are as many different answers to that question as there are days, dayparts and radio stations in the country (that’s days times dayparts times radio stations – so there are tens of thousands of possible answers). Each media buy is different, based on multiple factors including the size of the station audience as well as the supply and demand for each day, daypart and station.

So, one way to answer the question of radio ad rates is to tell you how much it costs to air one spot on a particular radio station in, say, Los Angeles, on a Tuesday at between 9am and 3pm. But the radio ad costs on that radio station would be vastly different – much more – than advertising on a station in Austin, Texas or Buffalo, New York.

And that’s just for one airing of one radio spot. How many radio airings of your radio ad would you like? Over what period of time?

By now you can see that there are number of factors that go into answering the question of how much it costs to advertise on the radio. From a very simple perspective, these inputs need to be provided before an answer can be given.

However for direct response radio advertising, we take a different perspective from even this. We look at advertising cost more like an investment- that is not some marketing-sales-speak. We look at it that way because in direct response radio advertising, that “cost” is accountable for a return, or an ROI (return on investment). For example, if a client invests $10,000 in radio advertising over a one week period of time, that $10,000 is accountable for a return on that investment that meets or exceeds the clients’ profitability hurdle. This is measured in new customers generated, a cost per lead metric, orders, or revenues.

So, when someone asks “how much does it cost to advertise on the radio?” or, “how much will my radio commercial cost?” we could say it depends on how many leads you want to generate, how much revenue you want to generate, etc. We would arrive at a radio advertising spend (investment) based on the kind of business results you want to see. And that’s why we LOVE direct response radio advertising so much!

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