Question

Topic: Advertising/PR

How Much Can I Get From Renting Advertising Spaces

Posted by Anonymous on 9/1/2013 at 8:27 PM ET 25 Points
Hello everybody ,

We are going to launch a new luxury lounge in central London. Our target market will be wealthy people mostly from Arabian countries. Since this crowd are the target market of many businesses I think It would be great if we can get some ads from different companies. There are two options:

1. we have a LCD TV in the lounge which shows music videos. I think we can show some adverts between them.

2. we can put some stand or other types of advertising materials in our place.

I would like to know your opinion about this idea. Do you think companies are willing to pay money for this type of advertising? If yes, how much can we charge them? we will have between 1000 to 3000 customers per month.

Thank you very much in advance and look forward to hearing from you.
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RESPONSES

  • Posted by darcy.moen on 9/2/2013 at 7:13 PM Accepted
    I think you might be sending out the wrong signal if you try to place ads in your lounge. First off, these folks are coming into your place of business to relax and socialize, and you are going to try selling them? I think its in direct conflict to what you are trying to offer.
  • Posted by mgoodman on 9/2/2013 at 7:14 PM Accepted
    I expect there will be companies who would want that advertising medium. Not sure what they'd pay because there are no standard rate cards for this kind of advertising.

    Suggestion: Identify a few likely candidates and schedule information interviews. Ask them about their target audience and how they reach them now. Ask about the value of a new customer (for them). See if you can find out what they spend now to reach their target audience.

    Once you have the information you can come back to them and give them a proposal that lets them bid on the space. They'll bid what it's worth to them. The key will be to present the benefit in a compelling manor. Make sure they have high value for what you're offering them.
  • Posted on 9/2/2013 at 8:46 PM Author
    Dear Mgoodman thanks for your suggestion and advices. I must do what you said.

    I also estimate we will have around 1000 to 2000 customers per month. If I charge a company £3900 for showing their advertise in our space, it cost them £1.9 to £3.9 per customer.
    I don't know in advertising industry, £1.9 - 3.9 per customer is too much or fairy enough? However definitely their profit from each customers is more than these numbers. please let me know about my price compare to other type of advertising is reasonable or not?

    I think they can provide a 1 minute advertising clip and we will show it in our LCD TV 8 times per night ( one time per hour) for during a month and it cost £3900 .

    I look forward to hearing from you again .
    Many thanks for your time and consideration
  • Posted on 9/6/2013 at 2:25 PM Author
    Well I recently find some useful information about comparison the CPI for different medias.
    As I found, The advertising cost for full page in newspapers can be more than £40k but when we devide it on the audience, the Cost Per Person would be less than 20p. The cost for advertising in TV per impression is even lesser than it.

    So if I want charge £3900 for my advertising space with 2000 visitors , in fact I will charge them £1.9 and in compare whith other media, my price is too high ! Am I right? Do I have to reduce the price or are there some other factors which I should take it in account?

    I look forward to hearing from you. Thank you very much in advance
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