Advertising costs are linked to audience size and special interests. While there are any number of ways media may charge for advertising, the figure that most experienced advertisers look at is the cost per thousand individuals who get a publication or who normally listen to or view broadcasts. (The abbreviation, CPM, is usually used instead of the words, cost per thousand.) In Internet advertising the CPM is based on the number of times a banner is displayed or the number of email subscribers to whom an email newsletter is sent.

Thus, if you spend $1000 on advertising and your ad appears in a publication with a circulation of 100,000, your CPM cost is $10 per thousand. (Divide the total circulation by 1000, then divide that result into the total cost of your ad to convert flat-rate advertising costs into CPM .)

Bigger general circulation publications usually have lower published CPM rates than smaller publications, but the biggest total price to you because of the size of the circulation. Thus if you paid $8 CPM to place an ad in a publication with 500,000 circulation you'd spend $4000 ($8 x 500). But if you paid $6 CPM to advertise in a publication with 1,000,000 circulation, your advertising spend would be $6000 ($6 x 1000).

The more specialized the media, the higher the CPM rate tends to be. Thus a publication or website that focuses specifically on a particular industry will typically cost you more on a CPM basis than a larger publication aimed at a more general audience. But, if your product or service is targeted at that specific audience or your store only reaches people in a particular community, you may get better results.

The reason: If only 10 percent of the media’s audience is likely to want what you sell, 90 percent of your advertising dollars spent with that publication will be wasted. Save money and get better results by putting your advertising dollars into media that will deliver the highest concentration of people who match your typical customer profile.

Before you place an ad, ask advertising sales representatives to give you a profile of their audience. Calculate what percentage of the media's audience matches the profile of your typical customer. Spend your advertising money with the media that can give you the highest concentration of likely customers at the lowest price. Remember, if 90 percent of the media's audience lives too far from your establishment to shop there, you've wasted 90 percent of the advertising dollars you spent.

5 Questions to Help You Determine Which Marketing Media to Use

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