How to Negotiate TV Advertising Rates
How much is that 30 second spot in the window?
Ask a sales rep and you might not get an accurate answer.
TV advertising, like all media, is negotiable, although novice media buyers wouldn’t necessarily know this. They often either take the prices they are given at face value or a cheap rotator schedule, figuring that any exposure is better than nothing.
Sometimes rotator schedules make sense, depending on your goals, but regardless of the type of schedule you are buying, chances are good you can get a lot more for your investment in television ads.
Remember You Can Negotiate
TV and cable stations need you as much as you need them. Perhaps more – because advertisers can always choose to replace TV with other media, analog or digital.
Stations would love to charge you more, of course, because it helps them make efficient use of their inventory while maximizing revenue. Sales reps would also make more on the sale, although, in general, their managers are more ambitious about charging high rates than they are. Sales reps like to maintain steady relationships with their clients, and any disruption – like a rate hike – is not welcome news to them.
The good news is you don’t have to take their first offer.
It doesn’t matter if you’re coming to the table as a brand-new client or a seasoned partner, you have the right to advocate for your business and make sure you are getting the best value for your money. Just to be clear, we are not telling you to throw tantrums and try to bully your media partners. That can backfire in your face very quickly. Our point is that you are there to negotiate a fair price for you and the station, and sometimes that price doesn’t come out in round one.
Know the tv advertising calendar
Like anything else for sale, media is a game of supply and demand. If you want to negotiate a better TV advertising rates you need to know what their true inventory situation is.
Demand spikes for broadcast television during the change of seasons, particularly in the spring (April through June) and fall-early winter (late August through December). These are the months when it will be tougher to get a better deal, although not impossible. Likewise, TV stations experience soft demand in the months between the holidays and spring (January through March) and mid-summer (July through mid-August). Those the months to look for good buys if the timing is right for your business.
be aware of events that impact tv inventory.
Those annoying political ads that never seem to stop running in an election year are a local advertiser’s worst enemy. Not only do they suck up most of the available slots in the programming you want, they also put tremendous upward pressure on prices. We’ve worked with some news stations that literally publish new rate cards every week during the heat of a political season. It’s an incredibly unfair to local advertisers who support the station the rest of the year and my advice is to cut back or eliminate your TV advertising during these weeks if you possibly can.
The upside is that in a non-political year, your TV partner will be hungry for business. They have a huge budget to make up after the previous year’s windfall, and a savvy negotiator with a nice bank can leverage better rates for him or herself.
Buy rotator schedules.
Rotator schedules enable you to buy ads across the broadcast day for dirt cheap rates. The downside is that some of your ads will fall in programming where your audience is probably not tuning in, like 11am to 4pm or midnight to 5am. If you decide to buy rotators, make sure the station guarantees at least half of the ads will run in dayparts where your audience is watching, then audit your invoices to make sure they keep their word.
BUY Ratings points.
Professional media buyers often choose a different method of measuring the value they get for their clients. They purchase ratings points.
A gross rating point is the predicted number of advertising impressions in a target audience, based on a percentage of that audience size. In other words, ratings points take into account the size of the audience at the time that your ad will air, as well as the percentage of that audience your message will potentially reach.
Buying ratings points takes skill and experience to do effectively, but it is the most scientific method of measuring broadcast and cable advertising value. If you have access to Nielsen audience data after the ads have run, you can “post” the schedule, determining if the station actually delivered the ratings points you were promised. If they under-delivered, you can make them run a bonus “make-good” schedule to compensate for your missing points.
commit to an annual plan.
TV stations would prefer to sell a lot of advertising in a discounted bundle than sell off every spot individually at their standard rates. Your best weapon as a negotiator, then, may be to commit to an annual plan, especially if you have established credit with the station.
Not only does this get you a better rate, it also forces you to plan and budget for the entire year rather than make it up as you go along. Planning advertising months in advance is always a better way to go. By purchasing a lot of ad time upfront, you are doing the TV station a favor and giving yourself a better position to negotiate better rates.
Advertising agencies specialize in professional media buying, and if you want the quickest path to lower rates, you may want to consider consulting one. In the meantime, you can learn about how TV stations function as a business and use that to your advantage when it comes to dollars and cents.
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