Wednesday, January 07, 2009

How to Buy Radio Advertising


I am training a salesperson who has no radio sales experience.

Here is a portion of what I shared with him so far.

However this is written for you, the business owner:


...Let's use radio advertising as an example. Pick a radio station that has listeners that are typical of your typical customers. Depending on:

  • Your profit margin
  • The buying frequency (how often a good customer buys what you are selling)
  • The actual $$ value of a customer over the course of 12 months
  • The amount of referral business each new customer is likely to bring in
  • And your budget
You should be able to determine how much advertising and which station to use. I'm going to use a real life example of a jewelry store.
  • Profit Margin (including sales) 50%
  • Buying Frequency, twice a year for sales, twice a year for service, repairs & cleanings
  • Annual dollar value of a customer $2500 gross profit
  • Each new customer is also worth 1 more referral customer.
  • Budget... To Be Determined in a moment.
Most radio stations would love to set you up on an annual contract. The longer the term, the better the rates in most cases, which is to your advantage.




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