Radio Advertising

Radio Advertising Costs: How Much Should I Spend?

“How many spots should I air on a radio station?”

Honestly, there is so much confusion concerning wireless advertising floating about – I can not blame you for asking these questions. What’s advertising on the radio so mysterious? The answer is – radio advertising is not mysterious. It just helps to understand how it works.

Effective radio advertising is dependent upon two major elements – the message (the radio commercial itself), and the media ( the radio spot airs on).

The Message

Let us look in the radio commercial itself. Before even considering that radio stations to broadcast on, or how much to invest on radio advertising rates, you need to think about what you will say on your radio ad. For this article, I am presuming that all call centers, satisfaction, websites, etc. lead generation, and revenue final processes have been set up by you, the advertiser. Developing a radio firm which can help drive traffic is extremely significant to the advertising process.

The advertising industry is full of voice talents, radio personalities, DJ’s and many others, all claiming to make radio commercials. Be cautious. When entering the world of radio commercial production, look for a radio advertising agency which has experience and a track record of successful advertising campaigns. Everyone can create a radio ad, but not everyone can create a radio advertisement that pulls traffic. Some radio stations give free radio advertisements if you advertise on their station. Most of these free commercials are never based on strategy and are just one of several dozen advertisements that have to be made by an overworked radio production individual at a five to fifteen-minute window of time. Remember, you generally get what you pay for.

The most effective radio commercials are built on a sound, proven strategy. The backup is written using time tested formulas which maximize possible response. The gift is handpicked to connect with the end user along with the production is based upon quality, and easy to consume sound.

So. . .what does the radio commercial manufacturing process cost? The majority of radio advertisements that work best generally fall to the $500 to $1000 price range. There are always exceptions to the rule (lots of alterations to replicate or audio, additional voice talents, celebrity endorsements, etc.) but this figure usually covers development of a good strategy, copy from seasoned copywriters, functionality by high-quality voice talents, and the highest quality production services.

The Media

For many with questions about radio advertising prices, and radio station prices, here is where the mystery begins. I will attempt to simplify the puzzle of radio media buying as far as we can in this small amount of space.

A Fantastic radio advertising buys targets a few Distinct things:

  • * Finding the very best radio stations in a market that match your client’s demographics (age, sex, income level, etc.) and psychographics (interests, beliefs, hobbies, character traits, etc.).
  • * Finding the dayparts that best reach your target customer. Mornings? Middays? Afternoons?
  • * Selecting the top radio stations that most efficiently reach the Greatest potential clients, the Ideal amount of occasions (defined as frequency), for the least amount of cash

Usually, when studying radio advertising expenses, many potential radio advertisers have a pretty good idea of their first two factors. But when it comes down to finding the best channel (or stations) in the very best price, the radio advertising process becomes a little more challenging.

This is the way to essentially determine how much to spend on radio advertising expenses. In the marketplace you need to market in, locate the radio channels having the best potential to achieve your target customer. This relies on the formats of their radio stations. Urban Hip-hop stations will target unique demographics than a News/Talk, or Soft Rock channel. After choosing a group of radio channels, contact those channels to let them know you are considering advertising in their radio station. Ask for specific information from the radio stations called “rankers”. This is ratings data that most radio stations can provide based on specific requirements asked. From this stage, you can find a good idea which stations perform the very best in your target demographics.

Once you have narrowed down the radio channels to just a few which will effectively reach our target client, request a proposal based on particular standards – dayparts, frequency objectives, etc.. From these suggestions, see who reaches the target market most effectively – using tools such as Cost Per Point (ratio of spot rate to ratings percent), Cost Per Thousand (ratio of spot rate to audience group totals), etc.. If a radio station is not competitive, ask the station to resubmit a more aggressive proposition. Ask about additional value. Yes. . .it is quite time consuming. . .and yes it’s challenging to understand if all of the station’s radio advertising rates are too high. You need to know the sector and the going rates. (This is where having a seasoned agency is very beneficial!) An agency can compare proposals against historic figures to find out if radio station prices are in accord with market averages. . .then negotiate, and help execute the purchase.

Great. . .but what exactly does this cost? It is dependent on the size of the market you wish to market in as determined by Arbitron (the radio ratings services). Radio advertising rates are often as large as $800 per 60 spots in a high market like New York City, or as low as $3 per 60 spots in Kerrville, TX. How are you going to know what to spend?

Here’s a valuable system we have used in our history of working with radio advertising rates. The system relies on a solid branding schedule that may run one place every day in the morning drive, one daily at midday, and one per day in the afternoon drive – Monday through to Friday, and 2 spots on Saturday and Sunday. That’s nineteen places weekly in sticker price. This type of schedule is excellent for attaining a desirable frequency level (meaning the average listener into a channel will listen to the radio commercial a certain number of occasions). Under these broad assumptions, you may use the following chart as a rough guide to marketing your radio advertising campaign. *

*Note, these are gross prices and do not include production costs or agency discounts. These are market averages to the standard radio program mentioned above, actual costs may vary. Doesn’t factor in added value, ROS programs, bonus places, etc.. Various combinations of dayparts on various channels may cost less.

* Markets 1 -5 (ex: New York City, Los Angeles, Chicago, etc..)

  • Expect to pay from $4000 to $8000 per week/per station for a high performing channel.
  • Expect to pay from $2000 to $5000 a week/per station for a high performing channel.
  • Expect to pay from $1000 to $3000 a week/per channel for a top performing station.
  • Expect to pay from $800 to $2000 per week/per station for a top performing channel.
  • Expect to pay from $500 to $1500 a week/per station for a top performing channel.

In some cases it is! These are criteria and radio advertising schedules come in all shapes and sizes. Sometimes, programs are smaller based on advertisements goals and objectives. But, it’s encouraged that you’re in a position to devote to the range of minimums.


Notice nothing was mentioned about remnant radio advertising here at all. Remnant marketing is the practice of buying fresh inventory at deep discounts. Remnant advertising success exists more in theory than in practice. Nonetheless, this is not to say there are not advertisers that are having success with remnant marketing. If, and when, remnant advertising falls into your lap, then it’s strongly advised that you start looking into it. However, basing your entire radio ad campaign on remnant advertising may be shooting yourself in the foot. With the exception of a couple times annually, most leading performing radio stations do not have that much unsold inventory. Many times, the biggest advertisers have contracts that guarantee numerous low cost/no price spots which have to run. The truth is that if big advertisers (using the major dollar program) desire their spots to operate, or if a different advertiser pays only 1 penny more than you did to your remnant spots – bulge! You just got bumped off the air that day. You may cover twenty five spots and only get two that air. The channels can make it up for you, but what if you were counting on this advertising to drive earnings. Or better yet, in the time of consolidated radio groups your remnant advertisements might run on the third to the past rated channel in the market. The outcome is NO RESULT. I am a firm believer that if it comes to radio advertising YOU TRULY DO GET WHAT YOU PAY FOR.

Now that radio advertising prices have been clarified, you might ask the question, how long should I market? The type of radio advertising helps specify the length of a campaign. Advertising for an event? We recommend shorter, more streamlined schedules to make buzz leading up to the occasion or launch. Branding a product? Often, long-term schedules with a little bit of breathing space function best. Maybe even flighting may work (on fourteen days, off two weeks or another length of time). Most of the time, the 2 things that can determine how long to run a radio promotion campaign is going to be advertiser targets (traffic amounts), and outside factors like sales cycles. Oh yeah, and generally budget affects the length of the campaign. It is not desirable, but that is reality.

The Total Cost

. .that’s $10,000 for one week’s worth of advertising!” That is accurate, and may be just what is necessary to reach several thousand potential targeted customers. The real issue is, “How much money can you make off a few thousand potential targeted customers?” Can it be more than $10,000 a week? $40,000 per month? These are questions to ask yourself, because from the world of marketing, that is pretty good traffic.

It works much better when you let a professional marketing agency reduce that price even further. Allow the agency get you a fantastic radio advertisements schedule by providing an instant discount ABOVE the negotiated cheapest radio station cost plus great additional value.

Allow Radio Lounge help you with all aspects of strategic development, creative development, copywriting, production, media planning, media negotiation, media buying and monitoring of your radio advertising campaign.