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.
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”
Media sales staffs are used to dealing with numbers that track their productivity, such as budgets, pipelines and close ratios. Journalists tend to abhor the idea.
Tracking the productivity of online journalists in a complex, well-managed environment is unavoidable. It?s by tracking the number of articles they manage and the page views they generate that managers can determine if they should hire more staff.
Imagine a site with a content staff of 10 that generates 10 million page views a month or a million PVs per staffer. Let?s assume about 1,000 stories a week ? mostly from the print side but some purely online ? automatically flow onto the site, with the biggest spike on Sundays. Among many duties, the staff produces original content, develops slide shows and is responsible for making sure all stories get on the site, flow into the proper sections, receive additional packaging, etc.
A new annual budget comes along with a 25 percent increase in revenue. Can ad rates go up 25 percent? Unlikely in this environment, but a rate increase can solve part of it. Can 25 percent more ad positions be created? Unlikely again, for most sites already have fleshed out their ad space. Other ideas are possible, but the obvious one is a major boost in page views, which will increase ad inventory at the same rate.
Let?s settle on a 20 percent increase in page views. You probably can?t make your content staff work 20 percent harder or put in six days a week. If you are convinced that they are fully productive, then the rational choice is a 20 percent increase in staff or two more full-time people in order to achieve the new PV target.
Those two new hires won?t join the others in checking the story flow. They must be focused on creating new content, sections and applications that will be major factors in boosting the site that extra 20 percent.
Tracking content staff productivity and developing well-defined job descriptions linked to those goals will go far in building a balanced and fairly managed online operation.
?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.
Newspaper Web sites that have at least one account executive dedicated to online sales have 87 percent higher online revenue than papers that rely solely on print AEs to sell online ads, according to the Newspaper Association of America.
In addition, 59 percent of the total revenue came from online-only ads, the NAA says. The association?s data comes from a recent Borrell Associates study.
While it is true that sites with dedicated online AEs deliver more revenue over time, it is worth noting that it doesn’t come easily for smaller newspaper Web sites — or any small site that can’t afford to hire a dedicated sales rep. Continue reading “Online-Only AEs Deliver Results”
An affiliate marketing strategy is a way to generate revenue for a Web site publisher by marketing the products and services of other companies. Making it work is a big challenge.
Affiliate marketing has been quite a popular subject on the Internet for a number of years because of its potential to generate big revenue for anyone who masters it.
But few people actually master it. Part of the challenge lies in the fact that millions are trying it.
For newcomers, an affiliate marketing strategy is a way to generate revenue for a Web site publisher by marketing the products and services of other companies. If a site visitor clicks on a text link or banner add, goes to that company Web site and makes a purchase, the originating Web site gets a commission on the sale. Continue reading “Affiliate Marketing Strategy Adds Extra Income”