[cma-l] Community Radio Spot Rate

Paul Golder paul at pvg.co.uk
Tue Feb 3 11:35:40 GMT 2015 

When I was running RLSs with The Phoenix (as it was known then) and
Mayflower FM (if anyone remembers that!) back in 1995-1996 I was charging a
basic package of £250 a month for spot ads.

And I still am! (Although everything is yearly and negotiated up or down
from there).

According to various websites, 20 years of inflation is about 73% so £250
then is worth £434 today.






On 3 February 2015 at 11:11, Tony Bailey <ravensound at pilgrimsound.co.uk>
wrote:

>  There's a great deal of good advice on this thread and I don't have a
> take on 24/7 operation, although our experience over many years of RSLs was
> that we could always sell spots locally to cover our licence costs even
> though I was never sure the shops got more customers!  The basic rate was
> around 50 quid excluding production (1980's - 90's) for 28 days (cash up
> front!).  One thing no one has mentioned I think, we closed down a few
> shops, or rather, they were using radio as a last gasp attempt!  Another
> thing, don't let anyone tell you that small scale commercial radio is bad
> competition - we certainly generated customers for ILR after we introduced
> them to radio advertising.
>
> Tony Bailey
>
>
> On 02/02/15 18:14, David Duffy wrote:
>
>  Alan asked 'Can your station survive if you charge 23p per spot?'  The
> short answer is probably, so long as that is not your only product.
>
>  Don’t forget, clients will expect a discount if they buy more that one
> spot so that 23p at list will rapidly become 16p at discount. Then you have
> to ask, will the discounted price cover the cost of sales (COS)?  If not
> then raise the list price.  If it does cover COS then at least it’s making
> some (small) contribution to the business. Whether it contributes to your
> profitability depends on your underlying costs.  And we all know their are
> great disparities in this sector when it comes to operating costs.
>
>  The problem with underpricing a product is that the perceived value is
> reduced.  And remember - the value is not related to the worth. Worth is
> the language of the seller and is about what the seller can get. Value is
> the language of the buyer and is about the usefulness or desirability of
> the product to the buyer. Value is not a number.  Sometimes, as Nick
> pointed out so graphically, some prospective customers cannot see the value
> (even if you gave it to them for free!).  Equally, as Alan points out
> rising the price can work.  I often recount the story of how Remington
> increased the price for its electric razors and gained more customers
> because people associated the low price with low value.  Raising the price
> raised the perceived value.
>
>  Pippa’s ‘Enterprise hour’ keys into an emerging trend for 'native
> advertising' that we are working on with a number of community stations. It
> allow stations to attract income by airing content that is of interest to
> listeners and doesn’t compromise the non-commercial sound of the station.
>
>  I've done a lot of work on product and service pricing over the years
> and it often bears no relationship either to worth or value. We have this
> simple table <http://www.theradiopeople.co.uk/pricing> which you might
> find useful.  It shows the 6 pricing strategies
> <http://www.theradiopeople.co.uk/pricing> that are most commonly used in
> radio.  Enjoy!
>
>  All the best
>
>  David
> Senior Partner - The Radio People
>
>
>
>
>
>
>  On 2 Feb 2015, at 17:17, Pippa at Curly Radio <pippa at curlyradio.com>
> wrote:
>
>   My goodness I’m surprised to read that you wanted to charge charities
> to advertise their events.    Before I set up Wycombe Sound, another CR
> practitioner warned me “not to bring a charity in, because otherwise they
> will all want a go”.
>
> In Wycombe, over two RSLs we actively invited charities to come in and
> talk about their work and events.  Many did, and with only the shortest
> reference to fundraising as we wound up the interviews.  Listeners loved
> hearing about all the good work which was going on under their noses, which
> otherwise they wouldn’t know about.
>
> As a result of the interesting and varied local content, which obviously
> contained more than just interviews with charities, the audience built
> quickly and businesses came knocking with cash in hand *because they knew
> we were reaching listeners.*
>
> Going further, in Wycombe Sound’s most recent outing, we invited ‘very
> small businesses’ – the sole traders, crafters, mobile hairdressers and
> beauticians, chimney sweeps etc, to come in for 5 minutes and talk about
> their businesses for free. We called it “Enterprise Hour” and ran it once a
> week for four weeks.  I thought we would be inundated, but we weren’t – I
> think that type of slot takes time to build – but the listeners loved it
> because it roused their interest.  Again, we had lots of interest in
> advertising from the business sector.  In fact, we had to turn some away
> because we couldn’t give them an impact in the short time we had remaining.
>
> I’m sure different strategies work for different stations.  For me though,
> the content comes first and that in turn will build audience and revenue.
>
> Pippa
> 07973 710963
> @curly_radio
> @wycombesound
>
>
>  *From:* Alan Coote <alan.coote at 5digital.co.uk>
> *Sent:* Monday, February 02, 2015 4:41 PM
> *To:* 'The Community Media Association Discussion List'
> <cma-l at mailman.commedia.org.uk>
> *Subject:* Re: [cma-l] Community Radio Spot Rate
>
>   I had the same problem when running The Bay in Poole and Bournemouth.
> Without a word of a lie, 3 different charities phoned one morning asking
> for commercial airtime for free. I asked if they had any budget for
> advertising their events, 2 said yes. But none thought that we would charge!
>
> Back to the spot rate… I don’t know any station who can sell all their
> inventory at full rate card, so rather than £80 a day think just £20.
>
> Here’s another tail  - At The Bay we doubled our published rates and guess
> what, we attracted bigger and better clients. Yes there we’re fewer and I’m
> not suggesting that money was rolling in, it wasn’t, but it stopped us
> going broke. It also meant we were selling  to companies needing to raise
> awareness as much as generate leads – an important factor for small
> stations.
>
> To add a bit of perspective, most local commercial stations won’t get out
> of bed to sell a package for less than £1000 at spots rates around £4
> upwards, it’s just not worth their while. The minimum to get on a Heart
> station is around £4500 and a regional is near double that.
>
> Commercial sales – yes been there, it’s difficult, but a rate of 23p a
> spot is surely putting the station at risk?
>
>  Kind Regards
> Alan
>
> Hear Alan Every Week on Let’s Talk Business The UK’s Premier Radio
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>
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>  *From:* cma-l-bounces at mailman.commedia.org.uk [
> mailto:cma-l-bounces at mailman.commedia.org.uk
> <cma-l-bounces at mailman.commedia.org.uk>] *On Behalf Of *Canalside's The
> Thread
> *Sent:* 02 February 2015 15:06
> *To:* 'The Community Media Association Discussion List'
> *Subject:* Re: [cma-l] Community Radio Spot Rate
>
> Mmm ?……………there’s the old adage           ‘’we’re worth, what we can
> get’’    and no more.
>
> It’s a bit similar to going to a record fair, it depends which area you go
> to. A vintage record on the circuit and going for around £75 quid, might
> only fetch £15 at a different venue.
> Some areas are more wealthy than others ?   is this Station operating in
> an area of deprivation and less businesses per-head ?
>
> It’s a learning curve setting the rates …. What some consider cost
> effective others may think too much                we have a Package 1 … it
> cost’s = £123.34p for the WHOLE YEAR     I won’t go into what you get but
> certainly a pub or organisation that put events is onto a winner as they
> get to use our events planner for free, they get an advert popping up here
> and there and a logo on the website ……..one woman who runs a bar in
> Macclesfield told me that our prices were      wait for it
> ‘’extortionate’’  !!!     her words not mine, and how could any business
> afford that sort of cost ?? !                    I explained   ‘’no no
> no’’   ‘’there seems to be a misunderstanding’’   ‘’this isn’t weekly or
> monthly, this is for the whole year’’
> She said words to the effect of ‘’no chance’’
>
> The business does appear here and there but mainly in the areas where they
> can FREE-LOAD. And there lies another problem …. Some people seem to think
> that because we are Community Radio and we are Voluntary led then
> everything for some bizarre reason is free ??      this Lady was of a
> similar opinion, and got quite uppity.
> I informed her that I was coming to Town on the Friday with 6 of my mates,
> and we were so enthused by the Bar that we were going to spend the whole
> evening in there drinking ……….. presuming of course that all the Beer was
> free   ??????
>
> Even after being sarcastic, she simply didn’t ‘get it’ ??     it seems to
> be rife in our business doesn’t it ?   this ‘’’not getting it’’’ ?
>
> Nick
>
>  ------------------------------
> *From:* cma-l-bounces at mailman.commedia.org.uk [
> mailto:cma-l-bounces at mailman.commedia.org.uk
> <cma-l-bounces at mailman.commedia.org.uk>] *On Behalf Of *Alan Coote
> *Sent:* 02 February 2015 14:37
> *To:* cma-l at mailman.commedia.org.uk; cma-l at commedia.org.uk
> *Subject:* [cma-l] Community Radio Spot Rate
>
> Can your station survive if you charge 23p per spot?
>
> I just had a 2 minute look around the web at community radio rate cards
> and found a station (it shall remain nameless) which, even if they sold
> their whole inventory 24x7, would make less than £80 per day.
>
> The reality is more likely to be £20 per day income at that spot rate.
>
> As far as I can tell the station isn’t funded by a parent organisation,
> they don’t run a membership scheme and there’s little off air income
> either, so it’s difficult to see how they could manage their running costs.
>
>
> Personally I think this is nuts and also devalues the medium.  Come on
> guys… know your worth.
>
> Kind Regards
> Alan
>
> Alan Coote
> Managing Director
> 5 Digital Limited
>
>
>
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