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The Cost of ‘No Sale’

 

The Cost of ‘No Sale’

 

A few weeks ago, I wrote about the negative impact of bonusing, discounting and weak pricing policies on sales rep confidence in the value they deliver. My friend Larry McInnis, Creative Director for CHUM FM, Flow 93-5 and TSN 1050 at Bell Media Toronto, commented “Another great one, Wayne.”

(Yes, I do read all of the comments we get.)

Here is my reply to Larry:

“Thanks, Larry.
I think I must be getting dumber every day because I see large companies in our industry do things I don’t understand. I see them cutting commission rates, attracting sub-standard talent and not investing in promotions, training, or creative to produce better results for their clients. They default to ‘selling’ via discounting rates up to 50% or more to ‘get the order’.
I know I didn’t learn ‘the new math’ some of these CEO’s studied, but by my ‘old math’, investing more in training, creative, and/or commission to get people who can sell at 100% of rate, and who can convert non-advertisers to advertisers, brings in more revenue than having inadequate ‘salespeople’ taking orders with huge discounts or bonuses.

My Old Math

A $100 rate with a 10% commission = $90 net.

A $100 rate at a 50% discount and a reduced 5% commission rate, = $47.50 net.

(a loss of 47%)

The Apparent New Math

Cutting commission from 10% to 5% = 50% saving on ‘cost of sale’ + less incentive for sales people + higher sales turnover, + less attractive compensation to capture the best recruits = less revenue.
I think it’s time to look at the ‘cost of NO sale’ or ‘cost of low sale’ instead of the ‘cost of sale.”
All across North America I see weak radio account executives grovelling for share of existing, and perhaps even dwindling, radio budgets. It seems to me if there was a bigger reward at the end of the process, we could attract the kind of professional sales people who could sell radio to new non-radio advertisers at great rates, rather than grovelling for existing scraps.

 

Your Most Valuable ‘Customers’

 

Your Most Valuable ‘Customers’

Most businesses define a ‘customer’ as someone who spends money with the company. At ENS media Inc., we define a customer as anyone who has impact or influence on the spending with the company. And media companies have three distinct customer groups under our definition.

Audience is our largest customer group. Even though they never spend a nickel on our stations, the size and demographics of our audiences certainly impacts what our second largest customer group; advertisers, is willing to spend with us.

And the most successful stations certainly pursue audiences and advertisers with vigor.

But our most valuable customer is our internal customer…..our staff. Each and every one on your staff, from your traffic manager to your front desk, and from the account executives to your producer, have enormous impact on what advertisers are prepared to invest with your station.

Why do I describe your staff as ‘your most valuable customer group?’ It’s simple. Do the math; divide your total annual revenue by your total audience, and you’ll find the value of your average listener/viewer. Dividing that same annual revenue figure by your total number of advertisers, will also tell you the value of your average client.

But when you divide your total annual revenue by your total staff, you quickly discover your average staff member is more valuable than your average advertiser, and in most cases, even more valuable than your largest advertiser!

You undoubtedly have a marketing plan to attract and maintain an audience, and you certainly have a marketing plan to attract and maintain your advertisers. But do you pursue your marketing plan to attract and maintain your staff with the same vigor that you pursue the other two less valuable customer groups?

 

Lead the Movement

Lead the Movement

You may have heard about the coordinated national effort between advertisers like Staples, Guess, American Eagle Outfitters, Cover Girl and more in an effort to create a new back-to-school shopping event on the marketing calendar.
They plan to create a national event to rival the now-popular Cyber Monday or Black Friday for back-to-schoolers, and more importantly, for their parents who foot the growing back-to-school bills.
They will be promoting Saturday, August 11th, as Back to School Saturday with special sales and events in posters and in Teen Vogue Magazine.
You have the opportunity to take the bull by the horns and take local ownership of what could become an annual revenue builder for your stations and own Back to School Saturday in your market.
Typically, the back-to-school selling season begins slowly in June, peaks during the second and third weeks of August, and tapers off to a close the third week of September.
You can bet your local newspaper people will try to publish a ‘special section’ or have a web-based flyer promoting Back-to-School Saturday in hopes of seeing it grow into an annual cash cow.
But he who hits the streets first can win that battle. Create your own 9 to 12 week program now that peaks with special sales, contests, free samples, demonstrations and events cumulating around the date of August 11^th.

 

Ellen Trashes Yellow Pages

 

You have to see Ellen DeGeneres trash Yellow Pages on this link…it’s a hoot!

 

http://www.youtube.com/watch?v=PtrdhEog73w

 

But don’t fool yourself! After you’ve viewed the Ellen Yellow Pages video, see how they’re converting advertisers to their new online products by clicking here:

 

www.showcase.yellowpages.ca

 

Yes, ‘the book’ is getting smaller, but our Selling Against Online and Printed Directories system will stop the migration from their printed products to their online products in its tracks and increase your revenues substantially! Click here to arrange an online presentation of how it works.

P.S. Thanks to my friend, Mebi Haddox at West Virginia Radio for bringing the Ellen video to my attention. We always appreciate our readers’ input!

 

Shampoo on Your Toothbrush

 

Shampoo on Your Toothbrush

                I was in the middle of working on a very thought-intensive project when I had to stop and hurry to get ready to catch a flight. While getting ready I nearly put toothpaste on my razor, and caught myself putting shampoo on my toothbrush.
          No, I’m not going senile! My mind was still on my project instead of brushing my teeth.
          While human hands and bodies appear to be capable of ‘multi-tasking’ the mind functions at its peak when focused on one task. That’s why your old ‘open door policy’ doesn’t work. Invariably someone will come into your office, interrupt your concentration on an important project and you’ll feel obligated to answer their seemingly mundane question in a misguided attempt to make them feel important.
          While your intentions are good, your open door policy is not fair to you or them.
          The once-held sacred belief in the value of the ‘open door policy’ was established when all of us had assistants, more staff, and less tasks to complete in a given day.
          Inevitably, while in the midst of another thought process, you’ll put shampoo on your toothbrush….giving the person who came through your ‘open door’ an off the cuff answer because your mind did not have time to switch gears.
          We’ve all said to ourselves in hindsight “There was a much better answer to that question had I had the time to focus on it.” And then, to make the interruption worse, it takes you ten minutes to get your head back into what you were working on! (Actually the neurological research reveals you will waste between 2 and 11 minutes trying to refocus properly).
          But your people, and their questions, are important. So here’s the solution to help you not lose focus on your important projects, and to give the questions you are asked the attention they deserve.
          Have, and stick to, regularly scheduled one-on-ones when you can focus on the questions you are asked. Then regularly practice the ENS Media Inc magic phrase when someone interrupts you; “This is important to me. Can it wait until our regularly scheduled one-on-one so I can give it the attention it deserves?”
          This process will create one of three results;
1.) Your people will learn to expect you to ask if their question can wait, and they’ll eventually have a lot fewer ‘urgent’ questions, placing them on the agenda for your one-on-one.
2.) More often than not, empowered people will find the answers on their own without interrupting you.
3.) You will give your people, and their questions, the full attention they deserve
          There is probably a better solution than putting shampoo on your toothbrush.