TV advertising has trust, power, and prestige. So, it's little wonder many advertisers believe it might be financially out of reach; but is this the case?
Visit someone’s home and find their sofas not facing the TV and you will quite likely assume they are puritanical weirdos. The television is still the focal point of our living rooms, and it continues to be the largest single portion of our video viewing: 76% among all individuals, and 53% among 16-34s.
Sure, TV has its detractors (looking at you ‘Pay Per Click’) but it still has the same impact as ever. In striking contrast to the grimy landscape of social media, television has credibility— it has maintained the trust of its audience. The tight regulatory environment of broadcast media is why most advertisers still consider TV the go-to medium for high profile campaigns.
Television is a brand-safe environment, and it still has an air of prestige. As Rory Sutherland—Vice Chairman of advertising agency Ogilvy UK—stated, “Public promises carry more weight, hence why the words ‘as seen on TV’ are more convincing than ‘as seen on Facebook’.” Not least, television still has the largest slice of the pie, accounting for 91% of all video advertising in the UK. YouTube holds just 5.6%.
Television remains the gold-standard of advertising channels.
Okay, I want to get on TV! But how much might it cost to run a campaign? How do you get the ball rolling?
The size of your business, your budget, and whether you have done much advertising before, will likely be the deciding factor in who to contact first. If you already retain the services of an advertising agency, they will likely be your first port of call as they will have established relationships with media buyers and commercial production companies. If you have not advertised on TV before, have an in-house creative department, or an agency unfamiliar with broadcast advertising it can be a sensible move to seek out a production company with the experience to manage the entire process on your behalf. The Clearcast process in particular can be a minefield for production companies unused to navigating it.
Anyway, how much does total world domination cost?
A television campaign budget has FOUR key cost-centres:
1. Airtime. Also known as ‘the media buy’, these are the fees charged by broadcasters for showing your commercial, and the fees to the media agency for the strategy and planning of the campaign. Airtime is always the biggest chunk of cash, and for good reason— what would be the point of making a TV commercial if only a handful of people get to see it?
Addressable advertising offers one of the most cost-effective ways to make a TV debut, AdSmart from Sky is a smart platform that can seamlessly insert a commercial into ad-breaks in Sky and Virgin Media households. AdSmart uses precise targeting criteria to deliver the commercial only to homes that meet your carefully defined audience profile (using thousands of data-points). AdSmart is powerful, and you can test the water with a small campaign for as little as £3,000.
2. Production. Commercial production will usually account for less than 10% of the cost of the campaign. That percentage is not carved in stone (a test campaign for instance) but if you were to spend far more money producing the commercial than showing it to viewers, the lesser impact would be self-defeating.
Every creative idea is unique; there is not a ‘standard’ price for commercial production. That said, there are eventually diminishing returns where spending extravagantly on production is unlikely to make a commercial any more effective. The ad most likely to provide the greatest return on your investment is not necessarily the most expensive. We can produce motion-graphics commercials (licensed for use in perpetuity across all media) from £2,500, and very simple filmed commercials in the ballpark of £5,000. At the higher-end of the advertising spectrum - using 10% as a guide - an advertiser spending £1.5m a year on airtime likely wouldn't flinch at spending £100-150k on the production of a commercial.
3. Licensing. Voice artists, actors, and musicians license (and bill accordingly) their contribution to a TV commercial based on both how long the campaign will air, and the number of Television Viewer Ratings— TVRs are a combined measurement of several factors that loosely indicate how ‘big’ a campaign will be. For example, the voice artist on a daytime commercial airing for a couple of weeks in a single county would charge a heck of a lot less than for a national ad running in primetime for the entire run of X-Factor.
The fees and terms are often negotiable for small-scale campaigns, and the cost is usually bundled into the production budget. But in the case of celebrity performers, endorsements, or royalties negotiated with an artist or label for a well-known track of music, the process can be a significant undertaking (and a large additional expense) that is billed separately.
4. Clearance and Delivery. Getting the commercial to multiple channels and video-on-demand services is a frequently overlooked part of the process— yet the commercial must first be approved by Clearcast, the body responsible for maintaining TV advertising standards compliance. The slots in which the commercial will air must be scheduled. The commercial master must be checked by a quality control system, and the file delivered to a server at each of the delivery points. The fee for delivery of a single commercial to one broadcaster is insignificant. But a complex campaign formed of commercials of multiple durations running on dozens of channels and on-demand services, can stack up.
If you’re considering advertising on television, JMS Group have been producing commercials for almost forty years— we have unparalleled experience of creating effective campaigns for new-to-TV brands, making the process both creative and straightforward.
Tom Vaughan-Mountford is an expert in television advertising and video marketing for SMEs. He has more than twenty years' experience in production and post-production for broadcasters, major advertising agencies, and name-brands. He is a regular writer on the media industry, a columnist at Brand Chief Magazine, and an author. Tom is a senior creative at JMS Group, a long-established TV commercial production company near Norwich.