How to determine Return on Investment?
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Your Profit Margin % and required amount of Gross Revenue needed per commercial to "Break-Even" |
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Station Ad Rate |
2% |
4% | 6% | 8% | 10% | 12% | 14% | 16% | 18% | 20% | ||
| $200 | $10,000 | $5,000 | $3,333 | $2,500 | $2,000 | $1,667 | $1,429 | $1,250 | $1,111 | $1,000 | ||
| $150 | $7,500 | $3,750 | $2,500 | $1,875 | $1,500 | $1,250 | $1,071 | $938 | $833 | $750 | ||
| $100 | $5,000 | $2,500 | $1,667 | $1,250 | $1,000 | $833 | $714 | $625 | $556 | $500 | ||
| $50 | $2,500 | $1,250 | $833 | $625 | $500 | $417 | $357 | $313 | $278 | $250 | ||
| $25 | $1,250 | $625 | $417 | $313 | $250 | $208 | $179 | $156 | $139 | $125 | ||
| $10 | $500 | $250 | $167 | $125 | $100 | $83 | $71 | $63 | $56 | $50 | ||
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If you purchase 20 ads a week on a station at $150 each (weekly contract
amount of $3,000) and your Profit Margin is at 6%, you'll need a GROSS REVENUE increase of $50,000 for your $3,000 investment….to "Break Even". |
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Purchase 40 ads a week on another station at $50 each (contract
amount of $2,000) or even 30 ads at $100 each...with the same Profit Margin of 6% and now you only need an increase of $33,320 in GROSS REVENUE for just a $2,000 investment (a bit more at $100 an ad)...…to "Break Even". A much better plan which helps to increase your "ON-AIR" repetition which in turn will produce a longer...lasting IMPACT. |
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The whole process becomes more successful as long as you hit the airwaves with enough "repetition" on the days you choose to have your commercials airing. One of the biggest drawbacks most business owners and/or decision-makers struggle with is "...I only get 'X' commercials a day....or week?"
The more ads per day or week you can afford to hit the air with...the more of an IMPACT you will have with "any" audience! The bottom line is your advertising has to make solid economic sense! Using the "power" of "Reach & Repetition" will produce a STRONG "Return on Investment" and that's what helps to drive your bottom line!
Get on the right track to maximizing the $$ you're investing in electronic advertising! Contact Steve Thomas at Thomas Media Group by email now at: sthomas@thomasmediagroup.com
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