January 6, 2016

Media planners must consider the correct medium to use for advertising, the cost, and how to measure overall effectiveness. It is important to know whether you are spending your advertising dollars effectively. Knowing the potential audience, how frequently your advertisement will be seen and its CPM can tell you whether you are spending your advertising dollars wisely.

Important terms: Audience – homes or people exposed to an ad Frequency – the number of times an audience sees or hears an ad Impression – a single exposure to an advertising message Cost per thousand (CPM) – the media measurement cost of exposing 1,000 people to an advertising impression – “M” is from the Latin word mille which means 1,000

To reach customers, advertisers use a set format that is defined in terms of time (30 second) or space (half page ad) Media costs vary greatly depending on type of media, geographic location, and audience.

Newspaper rates are divided into two categories – classified or display ad. Classified ads typically charge by the word or line. Display ad cost is based on the amount of space used, the ad’s position in the newspaper, day of the week, frequency, and color. Display ad rates are based on a column-inch rate. Cost of the ad * 1000 /Circulation = CPM $500 * 1000 / 500,000 = $1 per 1,000 readers

Magazine rates are based on circulation, the type of readership, ad location and production techniques. Magazine Rate Card Example:

There are different types of radio advertising – network radio, national spot-radio, and local radio. Rates will vary depending on type, time of day and length. Network radio advertising is placed within national network programs. There are few network radio programs being broadcast. National spot radio advertising offers an advertiser the opportunity to place advertising in nationally syndicated radio programming In local spot radio advertising, an advertiser places advertisements directly with individual stations rather than with a network or syndicate.

Rates will vary depending on channel, audience reached (national versus local), time of day/show ratings and length season’s 30 second ad rates (Advertising Age)

1. Sunday Night Football $603, Empire $497, Thursday Night Football $464, The Big Bang Theory $348, How to Get Away with Murder $252, The Voice (Monday) $240, Modern Family $239, The Voice (Tuesday) $233, Scandal $224, Blindspot $209,700

Internet rates are based on the type of display format – banner ads, rich media ads, pop-up ads. CPM: The CPM stands for cost per thousand impressions is the rate to be charged or paid for every 1,000 times an advertisement is displayed. It is widely used to set pricing for banner ads. CTR: The page click through rate (CTR) is the number of ad clicks divided by the number of page views. CPC: The cost-per-click (CPC) is the amount you pay each time a user clicks on your ad.

Google AdWords is based on an auction system that rewards businesses who have high-quality ad campaigns with lower costs and better ad placement. You can exercise tight control over how your AdWords budget is spent using tactics like ad scheduling, geotargeting, and device targeting. The average cost per click in Google AdWords is between $1 and $2 on the search network. The average CPC on the Display Network is under $1.average cost per click

The most expensive keywords in AdWords and Bing Ads cost $50 or more per click. These are generally highly competitive keywords in industries that have high customer lifetime values, like law and insurance. Giant retailers can spend up to $50 million per year on paid search in AdWords. The average small business using AdWords spends between $9,000 and $10,000 per month on their Google paid search campaigns. That's $100,000 to $120,000 per year. Twitter and Facebook are two options other than Google or Bing.