Pricing and Revenue Projections

When pricing online sponsorship opportunities and projecting corresponding revenue, it is important to understand that two main factors—traffic and market value—really guide how you assign value to your inventory and the approach you will take when selling it:

CPM Basis
Flat Fee

Once you determine your inventory's value and approach, it's time to get going and to take your online sales strategy to the next level. There are a number of existing options and tools available to help. Learn more. 

CPM Basis

A good rule of thumb is that if your website has 1,000,000 or more monthly impressions, you would do well to sell on a CPM basis. 

As a rule, the higher the traffic your online sponsorship inventory generates, the more likely your station is to attract interest from online-only sponsors. Your station is able to sell competitively, on a guarantee or impressions basis (i.e cost-per-thousand/CPM), and for the shorter flights traditionally associated with these kind of online campaigns. Higher traffic levels can correspond directly to broadcast reach, and thus larger markets usually generate larger amounts of online traffic. These stations tend to also be more readily equipped to address UBIT and the other considerations that come with selling on a CPM basis, and accepting the rich media creative from sponsors and agencies that these businesses also run on commercial sites.

As suggested, your website should generate at least 1,000,000 monthly page views for your station to consider selling on a CPM basis. For streaming audio and video that threshold is 200,000 audio or video streams. Here are some other benchmarks:

  • E-Newlsetters: at least 25,000 subscribers
  • Mobile: at least 100,000 impressions (mobile site), 25K downloads (app)
  • Podcasts: at least 25,000 subscribers
  • Social Media: at least 25,000 fans or followers

(Note: These are general guidelines for consideration, not hard and fast rules. Individual market or station circumstances will also come into play)

If you’re selling on a CPM basis, current acceptable rates for guaranteed sponsorship units on display ad banners are anywhere from $15 to $35/CPM, depending on your targeting criteria, at the local level.  Run-of-site (ROS) buys are on the lower end of the scale.  The more targeted the buy, the higher the CPM.  For example, if a sponsor wants to buy just the Arts section of your site, you would charge them more for those impressions than you would general ROS impressions.  Rich media (that is, Flash or in-banner video) may also command slightly higher rates. Streaming audio and video rates vary, from  $25-$40 for video. Network buys generate slightly lower rates but are a good way to sell remnant inventory across ad units.  Other variables include: the size of the graphical unit you’re offering, the location on the page, and the type of messages that you’ll allow.

Clients who buy on a CPM basis will have higher expectations in terms of performance and delivery.  They will typically want to see reports that show that the number of impressions they purchased were actually delivered.  They may even provide you with third party-tracking tags that enable them to monitor campaigns in real-time. They may expect you to help optimize their campaigns by either changing creative and/or shifting impressions to higher-trafficked pages during the course of the term.  ^top

Flat Fee

If your site has under 1,000,000 monthly impressions, consideration should be given to charging a flat fee for sponsorship

The less traffic your online sponsorship inventory generates, the more likely your station is best-served selling on a flat fee for longer periods of time, consistent with the terms of your on-air packages. Consider offering placement on a weekly or monthly basis. A number of stations are garnering $350-$400/month for annual contracts, rotating sponsors through their top trafficked pages. At $4,000+ a year, per client, you can see how this can easily add up to sizeable revenue.  In many cases with these kinds of clients, there’s not the kind of accountability with reporting. They’re happy to support public broadcasting and see their banners on a station’s home page. To price these opportunities, start with your pageviews and the suggested CPMs. For example, if you can deliver roughly 50,000 pageviews per month, then start with a $20 CPM, and that would give you a value of roughly $1,000 per month. If you rotate four sponsors in that placement, you could price that at $250 each per month.

Local media firms like BIA/Kelsey and Borrell Associates can also be good sources of local pricing information.  ^top


Get Going

Whatever your traffic level or local online advertising potential, there are existing tools and services available to you to help you get up and running as you take the time to develop a longer-term strategy:

  • Network: If your traffic is on the lower end, consider adding your station’s online traffic to the traffic of other public broadcasting sites and join NPM’s PMI Network. NPM sells on a CPM basis, and while network participation typically drives down CPM, it is an easy, turnkey way to get up and running with online sponsorship sales. Plus, you’ll be able to leverage the campaigns that may be running on the national sites, which meet high creative guidelines that are tailored to public broadcasting standards.
     
  • Hybrid: Explore selling your highly trafficked online content areas or features yourself –whether on a CPM or flat fee basis -- and designate remnant or other inventory to the PMI Network. This could give you the best of both worlds. 
  • Outsource: Consider outsourcing your entire digital ad operation to NPM’s network via PMI Ops, and take advantage of custom training and coaching along the way to prepare your station for future growth and the potential for in-house sales. 

 

Taking It Further

Already actively selling and pricing?  Use one of our worksheets to assess the value of the inventory you already have at your disposal and to plan for future growth:

ADDITIONAL RESOURCES

Assets

 

Glossaries