Estimate Your TV Results

Here's how you should think about whether or not TV is likely to be a good advertising choice for your business: Start out by estimating how much a prospective customer is worth to you. Then compare that to how much a prospect will probably cost you to get, using TV.

Here's how "Roger" did it: Roger makes a thousand dollars every time he sells a widget to a customer. He knows he has to talk to four prospects, on average, to get one customer. So, to Roger, a new prospect is worth $250.

He talks to his friend who advertises a similar product on TV in another market and finds out that his friend gets about three calls every time his TV spot runs, and one of the three calls becomes a real prospect. The friend is paying $50, on average, for his TV spots. So, for one new prospect, the friend is paying $50.

Roger takes this information and figures: If my experience were the same, then I would do very well advertising on TV. I would be paying $50 apiece for prospects who are worth $250 to me. In fact, I could do much worse than my friend and still make money with TV.

Get the idea? You probably don't have a friend selling something similar to yours on TV already, but take your best guess based on whatever information you can find. The point here is that this is the way you should think about TV advertising before you get started. Don't base your estimations of how well your offer will work on heavenly mind pictures being painted for you by TV salespeople. Instead, compare, as best you can, how much a good prospect is worth to you with how much a good prospect will cost you to get using TV.