Advertising

Traditional Vs. Digital Advertising: How Much Does Each Cost?

Team Pepper
Team Pepper
Posted on 22/03/224 min read
Traditional Vs. Digital Advertising: How Much Does Each Cost?

Table of Contents

  • Traditional Vs. Digital Advertising: What makes them different?
  • The Cost of Running Traditional Advertising
  • Digital Advertising Rates
  • Digital Vs. Traditional Advertising Expenditure – What to Choose?

The global advertising industry has come a long way in the past couple of decades. Where the goal earlier was just to sell products, the focus nowadays is on solving consumer problems. 

New technologies are taking over as the industry evolves, giving rise to one of the most common debates among marketers—traditional vs. digital advertising.

The decision regarding what medium to use is usually dominated by a single factor – the cost involved. In India, the share of traditional advertising for 2021 was approx. 71%, despite digital adverts becoming highly popular today. 

Digital advertising expenditures seem far less and more rewarding than traditional advertising, but there are many situations where the latter works best. We will provide you with a comprehensive overview of digital vs. traditional advertising expenditures and which one you can choose for your business through this article.

Traditional Vs. Digital Advertising: What Makes Them Different?

BASIS FOR COMPARISONTRADITIONAL ADVERTISINGDIGITAL ADVERTISING
NatureStaticDynamic
ConversionSlowComparatively fast
EngagementLowComparatively high
Return on InvestmentCannot be measured easily.Can be measured easily.
Effectiveness and costLess effective, more costlyLess expensive, more effective
TrackingNot possiblePossible
TargetingStandardizedCustomized
TweakingNot possible once the ad is placed.An ad can be tweaked any time, even after it is live.
ReachLocalGlobal
ResultsDelayed resultsQuick and real-time results
InterruptionsConsumers are often interrupted with ads as these cannot be skipped.Consumers have the option to skip ads or use ad-blockers to seamlessly enjoy their favorite programs.
CommunicationOne-way CommunicationTwo-way Communication

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By definition, digital advertising uses electronic devices connected to the internet like mobile phones, tablets, or computers to reach the consumer. Digital ads can take on the form of Google Ads, social media marketing, affiliate marketing, native advertisements, and PPC ads.

On the other hand, traditional advertising uses non-internet-based mediums for advertising such as newspapers, billboards, SMSs, cold calling, direct selling, or pamphlets and fliers.

Traditional and digital advertising methods differ on factors like the cost involved, target audience, reach, and the medium used to convey a message to the consumer.

Traditional advertising methods have a typically wider reach than their digital counterpart. Still, the only problem is the lack of reliable methods to track whether the message reaches the right audience or not.

Similarly, although we can track ROI when advertising digitally, the increasing presence of ad blockers and premium ad-free services makes it difficult to catch the target user’s attention.

Both advertising methods have their own advantages and disadvantages, and combining the two is the best way for businesses to reap the maximum ROI from their efforts.

The Cost of Running Traditional Advertisements

The general notion amongst businesses and marketers is that traditional advertising is expensive compared to digital ads. However, if we run both on the same scale, aiming to target the same number of people, the cost difference will reduce significantly.

Different advertising mediums incur different costs, depending on many other factors. For example, an advertisement run during prime time on TV or radio costs significantly more, but it also has a better reach and conversion rate. 

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Similarly, running the same ad on the radio is extremely cheap compared to television, where advertisers also incur additional costs for producing videos.

Despite the increasing advertising costs in print media, ad spending in India rose to 39% in 2021. Running print ads in a newspaper is much cheaper than running the same in a popular magazine or even on the billboard in a public setting. 

But since the latter offers more targeted reach and possibly higher conversions, all the big brands opt for it. Small and medium-scale businesses usually resort to newspapers for placing advertisements due to their comparatively low prices.

Overall, the traditional advertising costs are high if the brand wants to target a specific audience.

Digital Advertising Rates

The ads you see on Google, YouTube, social media sites, browsing a web page, and even playing your favorite game are all means of digital advertisements. The digital advertising rates are quite cheap compared to traditional advertising, usually allowing businesses to engage with the target audience much faster.

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Digital advertising is highly measurable, scalable, and profitable for businesses of all sizes. Not to forget that it is easier to design and redesign digital ads. These are reasons sufficient to justify why most small business owners think about running a wide-reaching digital ad campaign even on a low budget.

Another perk of using digital ads is that it allows you to effectively and quickly respond to customer queries and gain their trust. This helps influence their purchase decisions, a luxury rarely available with traditional advertising methods.

Traditional Vs. Digital Advertising – What You Should Choose?

Today, most businesses prefer to instantly opt for digital advertising because of its wide popularity, economic nature, accountability, and more targeted reach. However, as a marketer or business owner, you must consider your target audience’s preferences, business goals, and ad spending budget before choosing your advertising medium.

A great PPC or social media ad sometimes doesn’t get the desired results even with increased spending. At other times, a simple newspaper ad can significantly impact the target consumer. 

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Most small businesses consider digital advertising pricing a cheaper and more effective alternative to traditional advertising. It may be because, with digital mediums, they can quickly engage with their relatively smaller target audience even with a low budget.

But as the size of their target audience increases, the differences in cost of traditional vs. digital advertising gets reduced to a great extent. The ideal strategy would be to use a mix of traditional and digital marketing mediums to boost your brand’s presence, just like most big corporations do today. 

Digital advertising is a good choice for moment marketing, quick customer engagement, and getting instant results. However, for a long-term impact, the traditional advertising methods are better.

Traditional advertising, especially TV, billboards, and the Super Bowl, is for at least another decade. Traditional advertising costs may be high, but so is their impact when done right—the debate between traditional vs. digital advertising will continue into the next decade, but what’s more important is to realize which mediums would work the best for your brand. 

As advertisers continue looking for new ways to catch the millennial’s attention, it would be unwise to completely let go of the traditional advertising methods that cater to the older generations.

FAQs

1. Is digital marketing more costly than traditional marketing?

Typically, digital advertising mediums such as PPC, social media ads, native ads, SEO, or even content marketing are comparatively inexpensive than the traditional marketing methods. It is also more cost-effective than any of the traditional advertising mediums.

2. How much does it cost for a digital ad?

The cost of a digital ad depends on the medium you choose for advertising, your target audience, and the frequency of your advertisement. The average cost per month can range anywhere between $250 – $20,000 for medium and small businesses. Social media advertising and classified ads are the least expensive form of digital ads if done right.

3. What is the most expensive form of advertising?

Television ads, especially those featuring in prime time, are the most expensive form of ads. A local TV channel can charge anywhere between Rs. 1 lakh—Rs. 10 lakh for a 30-second commercial. The national TV channels charge much more, mostly in crores.

4. Is traditional advertising dead?

No, traditional advertising isn’t dead and will not die any time soon. However, the traditional advertising strategies are fast evolving to suit the changing consumer tastes and preferences.

5. Which Indian Industry spends the highest on advertising?

The FMCG sector in India is the largest investor in the advertising industry, accounting for over 21% of the overall expenditure in 2020. It is closely followed by e-commerce and then the consumer durables industries.

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