Cable advertising costs include production and airtime, with production costs including talent fees and script development. Advertisers can negotiate contracts and pay for services directly. Airtime rates vary based on spot length, time of day, and frequency. Other factors, such as package discounts and customer discounts, can also impact costs.
Most cable advertising costs fall into two main categories: production and airtime. Production refers to the filming of commercials or commercials, which includes costs such as talent fees and paying for developing scripts. Airtime refers to the actual purchase of airtime, which can be influenced by factors such as spot length and the time of day it is broadcast.
Some cable companies add the cost of producing a commercial, often called a “spot,” into the overall price of the cable advertising package. Most, however, provide these services for an additional fee. Advertisers could also choose to produce their own commercials, negotiate their own contracts and pay commissions directly to service providers.
Common production costs include writing a screenplay, paying for music if any is used, and selecting talent. Some companies choose to write their own scripts and provide their own actors while others choose to hire professionals. A company that uses professional writers and actors to develop their commercials must take into account any fellowship or guild costs and the cost of craft services – which proof food for the cast and crew during filming – and include those costs in the cable advertising costs.
Advertisers must also pay for a film crew, which might include a camera operator, lighting director, and sound director. If filming takes place in a location other than an Advertiser-owned property, location fees may apply. Once the ad is filmed, the advertiser must pay a publisher to create the final product and convert the files to the correct format so that the ad will air properly. All of these subcontractors add to overall cable advertising costs.
Paying for airtime is the other major cost associated with cable advertising. Airtime rates vary based on a number of factors. The length of the spot, the time of day it runs, and the shows during its airing are the primary cost factors.
Another major factor in cable advertising costs relative to airtime is frequency. Frequency refers to the number of times a spot runs over a specified period of time. Many cable advertisers offer frequency discounts. Standard packages are often available with built-in discounts, but most cable companies will also offer customized solutions.
Occasionally, other factors can impact cable advertising costs. If the cable company owns other media, such as an Internet presence or a print publication, package discounts could allow advertisers to take advantage of more media. Additionally, if the spot offers customers a discount for mentioning the ad, the advertiser will need to factor the cost of those discounts into their budget as well.
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