Is Radio Advertising Right For Your Design-Build Remodeling Firm?
Radio Advertising For Remodeling Firms
Digital marketing has changed the way design-build firms reach out to their prospective customers. It's an extremely cost-effect, efficient method for generating leads and sales and online content marketing can genuinely drive your new business growth. While content can be optimized to reach local customers better, it does still have a worldwide reach which can mean that your message is reaching readers who may not be local to your business.
While traditional marketing has seen a drop in use in recent years as digital marketing has grown, some conventional methods, like radio, can still have an effective reach when it comes to driving local awareness for your design-build firm. Radio advertising is more expensive than content marketing, but it's a robust traditional medium that reaches 93% of American adults weekly according to Nielsen. With an adequate budget, radio can be an effective medium for design-build firms if adequately targeted and executed. This is especially true when combined with content marketing.
Let's take a look at some of the nuts and bolts of radio advertising to see if it's right for your design-build firm.
Radio Advertising ROI
Let's start by looking at the average Return on Investment radio advertising can provide businesses in the home improvement industries. Some business types receive better ROI than others. Design-build firms and other companies in the home improvement industries can expect an ROI of about 9 dollars for every dollar spent according to a 2017 Nielsen study.
Because radio reaches a broad audience across all demographics, many of whom own their homes and are seeking improvements, it can be an excellent choice for many design-build firms. When considering radio, you need to take a look at your buyer personas to choose the proper outlet for your message. For example, if you're targeting middle-aged homeowners, advertising on the local alternative rock station might not be the best fit; however, the adult contemporary station might reach precisely the market you're targeting.
When considering radio advertising, remember, if you sell to a niche market, for example, your design-build or interior design firm specializes in mid-century modern homes only, radio advertising may not be the best choice for you. Unlike online marketing and content marketing, radio does not allow you to hyper-target your message; it uses a much broader brush to get your message out.
Radio Advertising Costs
The cost of radio advertising can range widely from $200 to $5000 per week depending on where you're business is located. A market like Ann Arbor, or Madison, will naturally cost much less than a major urban area like New York or Chicago.
You'll also need to factor in the cost of producing a 30 or 60-second radio spot. The cost for this can range from $300 to $1000 and typically includes copywriting, voice over talent and editing.
Pricing for the ads is based on the following equation:
Number of listeners X cost to reach 1000 listeners (CPM) = cost of advertising per exposure
The CPM varies from station to station and in different markets. Daytime CPM is generally more expensive averaging around $12 - $16 to reach adults from 18 – 49. If the audience is in the older demographic of 50+ day, part CPM is typically a few dollars less. Evening and overnight CPM are usually lower.
If you're calculating a radio budget you should be familiar with a few terms you'll likely come across when doing your research. They include:
• Average Quarter Hour (AQH) Rate – This refers to the number of people listening to the station for at least 5 minutes during any 15 minute period
• Cost Per Thousand (CPM) – This is the calculated cost to reach 1000 listeners.
• Gross Rating Point (GRP)– This is a measure of the impact of your ad. The formula for calculating GRP is the percentage of the target market your ad reaches X the frequency they hear your ad.
• Cost Per Point (CPP) – The cost to reach the AQH equivalent of 1% of any demographic.
• Net Reach – The total number of people a station reaches during a specific time.
• Cume Person – The total number of people who listen to the radio for at least 5 minutes.
• Exclusive Cume – Total number of people who listen to only one station
• Rating – The percentage of total listeners for a station divided by the entire population of an area.
• Share – The portion of the people in a city who listen to a specific station.
There are other factors to consider that will help you to determine not only the right station but your ROI when choosing the station to reach your target market and calculating the cost.
• Number of Listeners – ultimately this affects your cost and your reach. Spots during the morning and evening commutes will cost the most. Late night spots are most affordable. Likewise, if you live in a major metropolitan area, costs will be higher.
• Demographics – Radio stations that cater to the 25-54 demographic will cost more. These are the listeners with the most buying power.
• Demand for Time Slots – If you advertise in a competitive market, there could be price hikes as advertisers vie for coveted time slots. If it is a particularly busy period, for example around election time, Thanksgiving, or Christmas, ad rates will go up significantly often making it not cost effective to run spots during this time.
• Special Events – Prices may also vary around events in your location, for example, summer concert season, during Octoberfest, or any other local celebrations.
When doing your research, ask the radio station for their demographics. The sales department will have a breakdown of listeners based on gender, age, income and location that you can use to help you reach a decision. Once you've narrowed down which stations have an audience that matches your target market, you'll have a good idea of where to spend your advertising dollars.
Is Radio Advertising Right For Your Design-Build-Remodel Firm?
The short answer is, it depends. If you have enough of a budget to be effective and if a local station reaches the demographic market you need then, yes it can be. Radio is an excellent medium that can return up to 9X your investment if you're careful about targeting, have a well-produced spot, and tie everything back to your online marketing.
Like all traditional advertising, to be effective, you need to make 7 to 10 impressions on a listener before they act. That could mean that they hear your radio ad 4 or 5 times, then search out your company online, visit your website and read through your blogs and convert on your site before they make a buying decision.
Adding a radio component to your design-build firm's overall marketing strategy can be a useful tool. Make sure that you understand exactly what you're buying, and do your due diligence before making a buy. Work with a professional production company to create a spot and always make sure to reference your website in any of your radio advertising. Ultimately, design-build is a visual sale, while radio advertising is an audio medium, it can be a practical addition to your overall marketing plan.
About Michael Conway
I'm the owner of Means-of-Production. My firm has had great success using local NPR stations to promote the services of our clients. Our all-in-one marketing approach helps get clients back to your website where we can convert them into leads. If your a built environment firm seeking a partner that understands your business, clients and how to integrate traditional and online marketing, give us a call at (603) 289-6616. I'd welcome the opportunity to help.