Is your television advertising budget working for or against you? That may be difficult to answer unless you’ve meticulously crunched the numbers to determine if you’re seeing a solid return on investment for your marketing dollars.
Setting a Budget for Television Advertising
As you lead your company into 2020, take time to assess your current or past budget and determine if you need to make changes that will deliver the desired results. Here are seven tips to help you review your current TV budget or develop new one:
1. Take a Look at Your Overall Budget
How much you should allocate toward marketing depends on your company’s overall budget. According to the U.S. Small Business Administration, you should spend about 7% to 8% of your gross revenue on marketing and advertising if you’re doing less than $5 million a year in sales. However, there are different recommendations for various industries. HVAC contractors, for example, are at the high end of the spectrum, as marketing experts recommend they allocate about 20% to 25% of their overall budget toward marketing if they want to achieve rapid growth.
2. Identify Your Company’s Growth Goals
Another factor to consider in developing a suitable advertising budget is your marketing foundation and your company’s growth goals. If you already have an established presence in the community, your focus may be on sustainability. Start-up companies or those that are seeking to grow at a more rapid rate will need a higher advertising budget to accomplish their objectives.
3. Develop a Rough Draft of the Budget
Start putting together an initial draft of your TV advertising budget, knowing there are two aspects with associated costs: production and broadcasting. You will want to consider that production costs will be more if you are producing a more detailed, lengthy TV commercial. Also, how long your ad runs for, how often you run your ad, and when you air your ad will contribute to the broadcasting portion of the budget. It’s better to start with higher projected costs so that you are setting yourself up for success by having a budget align with your desired goals for the campaign. You can then collaborate with your company’s executives to fine-tune the budget so it reflects projected earnings for the coming year and your marketing goals.
4. Consider a Co-op
Cooperative advertising provides a cost-effective marketing strategy for manufacturers, retailers, and distributors to reach their target markets, according to Entrepreneur magazine. Some manufacturers help subsidize all or part of the cost of an advertisement in return for you specifically promoting them or their products. To explore the opportunities offered by on-brand co-ops, working with a trusted media company can help to navigate co-op advertising. They can assist you in making the right connections for your particular business.
5. Decide on the Scheduling
The more times that your ad is seen by your target audience, the better chance you have of making a lasting impression. Make sure you’re running ads often enough that customers recall your company when they require the services or products you offer. In addition to determining how often your ads will run, you will need to determine what days, and what times to run your ads. The days and times that you run your ads are critical because you want to be sure that you are reaching your desired audience. These factors will impact the cost of your commercial, so the goal is to find the balance between optimal scheduling and staying within your budget. Media companies who are familiar with your target audience and local market can provide you with important metrics to decide the best fit for your television advertising in terms of scheduling and what networks to use.
6. Price Your Desired Deliverables
Once you know the deliverables you desire, you can determine more accurately how much you should budget for TV ads. Until you have a clear plan of how long you want your ads to be, and when and where you plan to run them, you won’t know the precise numbers you’re dealing with. Once you’ve identified these deliverables, you can sit down with your media partner and determine if your desired results and preferred budget align. If not, they can help you make necessary adjustments so you get the best value for your dollars.
Developing a TV Ad Strategy
Television advertising still holds an important place in the digital world, but capitalizing on its influence doesn’t have to be confusing. You may know the market segment you want to reach, but you may not know which channels they’re watching and when. If you’re struggling with making sure that your advertisement reaches the right people at the right time, then consider working with a media company. A media company in your market is a great resource to call on for ensuring that your advertisement doesn’t fall on deaf ears. They are familiar with the local market and variables that can affect the cost of television advertising. It’s important to remember that when you set a TV budget that delivers results, you are making a decision for the betterment of your business, and that number will differ depending on your desired goals.
