One of the most common questions when launching a new station website is: “What should we charge for banner ads?”
If you’ve only ever sold ads based on on-air schedules and time slots, this guide will help you bridge the gap to digital. You’re not behind—you’re stepping into a great opportunity for new revenue.
Understanding Digital Advertising Basics
What is a Banner Ad?
- A banner ad is a graphic advertisement displayed on your website.
- It can appear at the top, side, or within content.
- Designed to either attract clicks or build brand awareness.
Impressions: The Digital “Audience”
- An impression occurs each time a banner ad loads on a user’s screen.
- For example, if a page is viewed 100 times, that ad receives 100 impressions.
- Unlike radio, which is sold by time slot, digital ads are sold by visibility.
Clicks: Measuring Engagement
- A click is when someone taps or clicks on the ad.
- Click-through rate (CTR) is calculated as clicks divided by impressions.
- Example: 1,000 impressions and 10 clicks = 1% CTR.
How Banner Ad Rates Work
CPM: Cost Per Thousand Impressions
- CPM (Cost Per Mille) is the price to display an ad 1,000 times.
- For example, a $5 CPM means $5 per 1,000 impressions.
- This model is widely used because it’s easy to track and explain.
CPC: Cost Per Click
- Advertisers pay only when someone clicks the ad.
- Less common for local station sites but useful if you offer ad network options.
Flat-Rate or Sponsorship
- A simple monthly fee for a banner ad, much like owning a time slot on-air.
- Easy to explain and manage, especially for new digital sellers.
Setting Rates for Your First Banner Ads
Step 1: Start Simple
- For local station websites, starting CPMs often range between $1 and $5.
- Premium placements, such as top-of-homepage banners, can reach $5–$10 CPM.
- If CPM feels too complex, offer a flat monthly rate:
- Estimate impressions × CPM = flat rate.
- Example: 20,000 impressions × $5 CPM = $100/month.
Step 2: Track and Report
- Use Google Analytics or similar tools to track impressions and clicks.
- Share monthly reports with advertisers to build trust and prepare for rate increases.
Step 3: Raise Rates as Value Grows
- Increase CPM or flat rates by 10–20% every 6–12 months based on growth.
- Justify increases with audience stats, engagement, and proven results.
Sample Flat-Rate Pricing
| Ad Size | Placement | Monthly Rate |
|---|---|---|
| Leaderboard (728×90) | Top of homepage/subpages | $50–$100 |
| Medium Rectangle (300×250) | Sidebar on homepage | $25–$75 |
| Mobile Banner (320×50) | App or mobile site only | $25–$50 |
Explaining Digital to Traditional Advertisers
- Impressions = Opportunities: Like how many listeners hear an on-air ad, impressions reflect how many people saw the banner.
- Clicks = Engagement: A click is like a listener calling after hearing a radio spot.
- Digital = Measurable Results: You can track exactly how many people saw and clicked each ad.
Proven Examples
| Placement | Starting CPM | Flat Rate (20K Impressions/Month) |
|---|---|---|
| Homepage Leaderboard | $5–$10 | $100–$200/month |
| Sidebar Banner | $2–$5 | $40–$100/month |
| Lower Page Banner | $1–$2 | $20–$40/month |
Case Study: A small-town station started with $2 CPM for sidebar banners and $5 CPM for homepage banners. After six months of consistent reporting and increased traffic, they raised rates by 15%.
How to Increase Digital Ad Rates Over Time
- Track website growth with consistent reports.
- Bundle banner ads with on-air and social promotions for added value.
- Offer premium placements and sponsorships for key pages and app features.
- Use advertiser success stories to justify higher rates.
Tips for Success in Unrated Markets
- Use clear, simple language and analogies for digital ad concepts.
- Bundle radio and web for stronger campaigns.
- Share performance reports and be transparent about the pricing strategy.
- Watch what other local media are charging for digital space.
Conclusion
Transitioning from schedule-based ad sales to digital impressions may feel unfamiliar, but it’s a manageable and rewarding shift. Begin with flat rates, build data through tracking, and gradually move toward CPM pricing. Consistency, transparency, and education are the keys to building advertiser trust and digital revenue for your station.
We want to help your radio station grow and succeed online. That journey starts with an amazing website that keeps visitors coming back often. Reach out to us to start your path to online success, or schedule an appointment to see our tools in action.