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How much do I charge?
A rough guide to working out the what you should expect advertisers to pay to promote their wares on your station.
If you were a commercial radio station you would start work out the costs of each hour of broadcasting and have to make that in that hour.
So assume that your costs of operating the station work out at £50 a day, and you broadcast for 15 hours a day that's about £3.20 an hour. Obviously the costs of a breakfast show on a commercial station will be greater than the late night show - more staff / higher production etc. Let's say you are prepared to carry eight adverts each hour, you therefore can charge 40p an advert.
That is the cost-price of your advert, but obviously you don't tell your advertiser that. You can not go lower than that cost, at any cost! The standard thing is to approximately double it - so you'd tell the advertiser that the cost was 80p.
Again, obviously you don't sell each advert individually. You make packages - for example a week's worth of advertising which has one advert played every other hour (8 plays a day x 7 days = 56 plays = £~45).
Then you find reasons to knock money off that price
- 20% if you pay up front is always a very good one; you get the money so they can't do a runner on you. You're still making a profit.
- 10% if you are a non-commercial/small business.
- Buy three weeks and get the fourth week free (ie 25% off)
Effectively your sales team need to get the highest price but without losing the sales. As long as they know what the cost-price is, and don't go below it, they should be all right. Don't go in and instantly offer all the incentives, but play it depending on how the client reacts.
On top of that bear in mind the cost of making the advert. You can charge a production fee, but if you're doing it in house and made enough on the sale you can use that as an incentive (we always used to give small businesses free production). I'd charge £50. Alternatively, there are lots of professional outfits that knock adverts out overnight for under £100 and sometimes these save finding one of your team to make the advert. Again, pass this cost onto the advertiser.