Television in India is still the largest medium in terms of reach. The money needed to make a TV ad varies according to the concept of marketing campaigns. The total cost of TV ad can be by adding the amount of money required for the production and the number of slots in which the ad runs. This sum is then divided by the number of customers converted during that timeframe for determining the average conversion cost. However, it is very important for every company to identify the category of their business before paying money for advertising. In TV advertising, picking the right season is also crucial. This can save a lot of money from the advertising budget.
Production cost
Production costs for making a TV ad ranges from few hundreds to lakhs of rupees. There are some independent TV stations that produce ads for free if the company signs up for a fixed duration of commercial spots. Local TV stations charge from Rs. 1 lakh to 10 lakh for creating a 30-second commercial. National commercials produced by an advertising agency can cost crores of rupees depending on the budget of the advertiser.
Running cost
Telecom Regulatory Authority of India (TRAI) has imposed many restrictions on Indian television advertising space and a broadcaster can only use 12 minutes in every hour for commercial promotions. That is the reason why some of the top Indian TV Channels demand a price tag of Rs. 3,50,000 for a 10-second spot during primetime. An average 10 seconds cost for advertising on some channels across Maharashtra costs around INR 500/- for every 10-second commercial whereas the same ad on popular channels would cost over Rs 6600/- for a 10-second ad. These rates become 1.5 times for 15 seconds, 3 times for 30 seconds and so on. Last-Minute deals are the most expensive ones and one should buy the ad spaces that are unsold.
Factors that determine advertising cost on TV
- Demographic of viewers – Advertisers want their ads to have maximum impact by reaching the age group that spends money, that is why the most popular demographic is people in age group of 25-54.
- Live viewership – Advertisers pay more for the programs that are watched live. This is the reason why ads during important cricket matches are most expensive.
- Time selection – Primetime ad spots are when most people watch TV, in India the time around 7pm to 8pm is the prime time.
- Geographical location – People in metro cities are the ones who spend more money as compared to the people living in smaller towns.
