Old Newspaper Ad Concept Produces Online Results

A well-known and traditional way of advertising in a newspaper is becoming an effective technique for selling online.

The traditional way is simply to buy an ad position in a certain section of the paper on a particular day of the week. It turns out the concept works quite well online.

This approach contradicts the popular way of running a banner campaign online. With a typical banner campaign, the client buys X number of impressions to appear in a section on the site or run of site (ROS) over a period of time.

The time period is usually weeks if not months. The online ad-serving software displays the ads smoothly over time so that 100,000 impressions, for example, will appear about 1,000 times a day over 100 days. The client usually pays on a cost-per-thousand impression basis.

Some newspapers are successfully using the print model online. They go to an advertiser and say, “For $1,000, your ad will appear all day long Friday on just the home page.”

The number of impressions for both the home page and the ad on Friday doesn’t matter. What matters is that the advertiser dominates a page on the site for just that day.

Some of the opportunities are obvious. They include events, sales and other dated, short-term opportunities. Imagine an important event that is falling behind on ticket sales and is in need of a last-minute boost. One newspaper reported great results for a local semi-pro hockey team that sponsored the sports index page of its site. The team sold so many tickets because of the campaign that it came back repeatedly to promote future games.

Another benefit to this approach is that print account executives who need to deliver some online sales results grasp it easily because it has something in common with print. As a result, they will find it easier to sell than other online products. Likewise, advertisers who are used to buying print but not online will grasp it more quickly as well.

AdWords Broad Match Can Boost Results

Using broad matches of keywords in a Google AdWords account can increase the number of clicks to a site, but they also can bring undesirable visits as well.

A broad match keyword or phrase is used in AdWords to display an ad to Google site searchers when they enter those keywords. The ad is triggered when the keywords listed in the account are entered into the Google search box and for similar but relevant keywords that aren’t listed.

For example, go to an AdWords account and choose high school football as a keyword phrase. Even if no other keywords are listed in the account, AdWords might display the ad to visitors during Google searches even if they use such phrases as school high football, which is an actual search term with high monthly volume.

An AdWords account can easily grow into thousands of keywords that have to be manually entered by the account manager. It can become so massive that effectively controlling the performance of all keywords can chew up a significant amount of a day.

Using broad-matched keywords is Google’s way of helping with the workload. The account manager doesn’t have to dig up every relevant keyword and manually add it to the account list.

But some broad-matched keywords can trigger related but undesirable keywords as well. The keywords may not be entirely relevant, or they may be so popular that their volumes overcomes the listed and more desirable keywords. They may also produce poor results with contextual advertising such as AdSense.

In that case, the account manager can switch to exact match keywords. It simply requires that every keyword is entered into the account with quotes, such as “high school football.”

The ad will be displayed only when that exact keyword phrase is entered into the search box.

Broad-matched keywords are an easy way to create and build an account, but in time any keyword list requires more careful fine tuning to get the best possible results.

Cost of Sale Helps Manage Advertising Staff

?Cost of sale? is just as important to managing the profit goals of a Web business as gross margin, which is profit after content and production.

At least in some operations, cost of sale is defined as the sum total of all sales and marketing costs, including staff, commissions, benefits, promotions, research and other related expenses.

There are many variations to the cost structure of a company or operating unit, but one lengthy and profitable experience allowed me to set a target of sales and marketing costs at 30 to 35 percent of revenue.

Just like with content and production costs, when the cost level drops below 30 percent, it was a signal to invest more in sales and marketing, while a cost level above 35 percent raiseed questions about either overinvestment of funds or sales staff falling short of appropriate goals.

So with 30 to 40 percent of expenses going to content and production, and another 30 to 35 percent going to sales and marketing, the remaining 25 to 40 percent goes to administration, technology, taxes, other expenses and finally to net profit. Managing these two important components of cost went a long way toward achieving profits in an extraordinarily high growth environment.

Simple Revenue Metric Helps Set Annual Budgets

One of the challenges of managing a Web site of a traditional media property is how to find a rational way of setting the revenue budget.

The challenge is more acute when an Internet operation has metro dailies, small dailies, weeklies and broadcast sites as part of the total network.

What revenue budgets make sense and how do they differ among the different types of properties? Broadcast sites don?t have traditional classified listings to tap. Weekly site have less competition than dailies, especially major metro dailies. Publishers already are under severe financial pressure and are understandably concerned about the additional burden of contributing to an aggressively increasing online revenue budget. Continue reading “Simple Revenue Metric Helps Set Annual Budgets”

Local Online Video Sales

An online sales manager sent a note asking about getting started in online video sales. The quick answer is, start small.

A previous post pointed out the limited viewership at this time with local online videos. It is important to establish a foothold in video by producing some clips, learning the technology and gaining insight into the audience. But the great majority of video viewership is on national sites such as YouTube, while much smaller viewership is on local media sites.

A local site that is regularly getting more than 100,000 views a month is probably an exception right now. A more common amount of traffic might be in the tens of thousands. Many sites are likely generating less than 10,000 views a month if they are doing video at all.

At a $30 cost per thousand video views (video commands a higher cpm because it is a captive audience), the inventory on a site with 20,000 views a month is worth $600. In contrast, page view inventory is worth $150,000 a month on a site with 5 million PVs a month (5M/1,000 x $10 cpm x three ads per page). In addition, video has a high production cost because it is labor intensive.

A good starting point for sales is just one or two video sponsorships that include the preroll (the ad at the beginning of the video, usually less than 10 seconds long) and a banner position on the pages that display the videos for the sake of added value.

But there is a better answer. Consider starting with a video version of Top Jobs, which is an upsell of employment liner ads into a video format. It has successfully rolled out at quite a few newspapers, has decent advertiser acceptance and can quickly generate six figures of revenue in metro markets. The profit and revenue from this product can finance the growth of video in other areas of the operation.

Sales Staff Incentives

Online sales people need to be more persevering than traditional media AEs because of the extreme peaks and valleys of the business.

Compensation is one way to help them through the valleys and boost their performance even higher during the peaks.

Management should consider two critical questions about a new hire. Is the AE experienced with online sales or not? Will the AE fill a strong existing desk of business, a weak one or a new one? The answers help determine the structure of the compensation for the early months on the job.

A new AE who has to develop a desk of business from scratch needs some kind of financial guarantee to stick with the job during the early months of development. The techniques include salary only, salary with bonus, salary with commission or draw against commission (guaranteed payout, sometimes even if the goals aren?t met).

Most AEs without previous online sales experience seem to need at least six months getting comfortable with client questions and objections. Experienced AEs of course need less.

Managers often believe that salary only is a poor option for any sales person, even when they are given months to settle into a new job. So an introductory phase of high salary and low commission, or salary and commission with draw, are options to consider for inexperienced AEs with weak or new desks. Salary with bonus or salary with commission are good choices for the experienced AE.

Once the desk is running well, other options include straight commission or commission with bonus. These options seem to work best with salespeople who are highly motivated, risk tolerant and willing to work extra hours. But these kinds of salespeople are rare.

Guide to Vendors Specializing in Turnkey Solutions

This guide covers vendors who specialize in providing turnkey solutions for online newspapers — products and services that cover a full array of functions such as content management, advertising delivery and other solutions in one complete package.

Media Span: A full range of integrated print, broadcast and online products.

TownNews: Vendor claims more than 300 newspaper customers ranging in circulation from 900 to 300,000.

First Day Story: specializing in turnkey solutions for community newspapers.

Matchbin: also specializing in turnkey solutions for community newspapers, radio stations, TV stations and clients in other industries.

Dynaportal: More than 40 applications including content management and advertising delivery.

Clickability: Claims more than 400 Web publishers as customers for its on-demand Web publishing products.

Harvest Info: This vendor focuses on providing a full suite of advertising products.

Print2Web: Another well-known industry vendor that focuses on providing a full suite of advertising products.

Kaango: Provides a comprehensive classified platform including transactional capability.

Please use the Contact form through the link on the left to submit other recommended vendors.