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How Much Does a Commercial Cost? Getting Creative in the CTV Era
Find out the answer to “how much does a commercial cost” with this guide that breaks down production and placement expenses.
Here’s what you should expect to spend on a range of commercials and placements
Creating a TV commercial is an effective way to spread your brand’s message, but it can also be one of the most expensive. The budgets for high-end, 30-second commercials can outstrip the budgets for feature-length films, so it’s important to ask “how much does a commercial cost” before you commit to this form of advertising. Fortunately, you don’t have to spend money like a Hollywood production to create and run an effective TV advertisement.
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How Much Does a Commercial Cost?
The cost of a commercial can range from around $1,000 to well over $10 million. As any TV viewer can tell you, not all commercials are created equal. Some are made to be aired to local markets for a limited time in order to promote a special sale. Others are built to be part of national brand identity pushes that will air in one form or another for months or even years. Still others are meant to be massive events in their own right, bringing in specialists from across industries to craft a one-of-a-kind advertisement that will be seen by hundreds of millions of people all at once.
The main costs that combine to answer the question of “how much does a commercial cost” are the expenses of making the commercial itself, and the cost to place the commercial. Let’s address each in more detail.
How Much Does Commercial Production Cost?
The first main factor that goes into determining the total expense for a commercial is its production cost. Production costs will vary widely depending on the type of commercial you wish to create, so here are a few examples to help with a back-of-the-envelope estimate:
- Less than $1,000: A commercial made with stock footage, a non-celebrity narrator, and limited post-production effects such as your logo and some superimposed text.
- $1,000 - $50,000: A commercial made with journeyman-level cinematography and local talent, with some effects such as motion graphics.
- $50,000 - $1,000,000: A commercial with eye-catching scenes, union-represented talent, editing that is well-suited to multiple broadcast lengths, and extensive post-production processes such as special effects.
- More than $1,000,000: A commercial that may feature celebrity actors or directors, innovative use of special effects and animation, and beyond — if you want the type of TV ad that could fit in during a Super Bowl commercial break, you should expect a substantial expense.
Individual factors such as the type of production crew employed to shoot the ad and the effects used to prominently feature your brand’s message will have a substantial impact on the price you should expect to pay, as will the length of the commercial itself. Working with an established creative lab that has extensive experience in building better-performing ads can help your brand arrive at a much more manageable production cost while delivering better results.
How Much Does a TV Ad Spot Cost?
Now that we’ve accounted for the first part of the answer to “how much does a commercial cost,” it’s time to add the second: how much it will cost to air the spot on your medium of choice. There aren’t as many individual considerations for pricing here as there are in the production process; instead, your preferred TV advertising medium will make the biggest difference.
Linear TV Airtime Cost
Linear TV tends to be one of the most expensive advertising mediums available to brands, though that’s only in general terms — an ad that runs only on local television will cost far less to place than one that runs on national TV, and early morning ad placements will be substantially cheaper than those in primetime.
Note, however, that you shouldn’t think of these lower-cost options solely as budget-friendly fallbacks. If your product or service is only available locally, your ROAS will almost inevitably be higher if you stick with local advertising. In general terms:
Local TV (small to medium market) ad placements have a typical cost per mille (CPM, the price per thousand viewers) of anywhere from $5 to $50.
Specialty spots around popular events such as the Super Bowl command the highest rates: the average price for Super Bowl LVII ad spots was $6 million a piece.
OTT Advertising Costs
OTT or over-the-top advertising refers to commercials that run on ad-supported streaming services such as Hulu, Peacock, and Disney+. While these companies don’t publicly reveal their rates, here’s a list of their rough CPM rates as shared by advertisers who have worked with them:
Discovery+: Low-to-mid $20s CPM
Disney+: $50 CPM
Hulu: Low-to-mid $20s CPM
Peacock: $30 to $40 CPM
Paramount+: Low-to-mid $20s CPM
HBO Max: $40 or higher CPM
These rates change regularly in response to market conditions, but they should be enough to help you start planning out your commercial’s potential OTT advertising costs.
CTV Advertising Costs
Advertising on connected TV (CTV) presents an effective blend of the attention-commanding presence of linear TV with the flexibility and measurable performance of digital ads. With nearly nine in 10 US households now owning a CTV, there’s never been a better time for forward-thinking brands to investigate CTV advertising costs. Working with the right CTV platform will allow you to save on more traditional OTT advertising costs, while also unlocking the streamlined attribution and curated inventory of secure connected TV devices — and you can get started with no minimum spend requirement.
tvScientific is the most sophisticated performance advertising platform for CTV. It’s our mission to make TV advertising both accessible and measurable for brands and apps of any size by offering access to 95% of ad-supported video-on-demand streaming apps all through one platform. Industry-leading automation and optimization make it easy to make sure your campaigns are hitting your advertising goals, and our commitment to radical data transparency means you can trust your campaigns are delivering as they should. Set up a demo with tvScientific today to learn more.