[cma-l] Community Radio Spot Rate

Tam Curry tamcamglen at googlemail.com
Tue Feb 3 12:48:41 GMT 2015 

Hi all,

I've been paying particular attention to this thread as we've now come up
with our first rate card ahead of our launch on 19th March and I'm starting
to question whether we should be offering our 50% discount for early bird
customers!

I certainly don't want to de-value our service - do you think it best to
keep the discount idea on the back burner for now and see how it goes?

Obviously we don't yet have the benefit of approximate listener numbers
although we do intend on referring to our RSL listener figures - purely
from folk accessing our web service which are exact, although potentially
misleading as we wouldn't account for length of listening time.

Our aim is to rope in 8 - 16 advertisers prior to launch, which I hope will
potentially attract more interest in the service. At the very least it
gives our advertising chap something quite real to refer to when doing the
rounds..

Cheers

Tam

On 3 February 2015 at 11:35, Paul Golder <paul at pvg.co.uk> wrote:

> 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
>> Programme For Current and Future Entrepreneurs - Now Broadcast To 5 Million
>> People  <http://www.letstalkbusinessonline.com/>
>>
>> Email - alan.coote at 5digital.co.uk
>> Phone - 0800 949 6655
>> Mobile - 07801 518858
>> Twitter - @TheAlanCoote <http://www.twitter.com/TheAlanCoote>
>> Web - http://www.5digital.co.uk
>>
>> Let's Talk Business
>> Twitter - @LTBShow <http://www.twitter.com/LTBShow>
>> Web - http://www.LetsTalkBusinessOnline.com
>> <http://www.letstalkbusinessonline.com/>
>>
>> <image001.gif>
>> The Media Production, Broadcasting and Training Company
>>
>>  *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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