Online Direct Sales Take Time to Deliver Results

Larger websites use online direct sales to produce more advertising revenue and increase profits.

Direct sales require the site publisher or another employee to contact potential advertisers for the sake of landing an advertising contract. It requires much more work than networks such as Google AdSense, which largely automates the process and takes a 32 percent cut of the revenue.

That 32 percent cut is largely what anyone should plan as a labor cost when they sell online advertising on their own.

Selling online advertising has a longer sales cycle on average than traditional media because many accounts are either new to it or have little experience with it. If they aren’t new to it, they may prefer to stick with major advertising outlets such as Google, Bing, Facebook or Amazon.

A retailer who has been placing campaigns in newspapers or on broadcast for many years will have a solid grounding on what to expect. Those mediums are in their comfort zones.

But even today, many years after the first web browser, traditional businesses might spend only a small percent of their budgets online. They also may have had a few bad experiences with it or had unrealistic expectations that online is simply about clickthroughs. Yes, it is about response, but more and more it’s also about branding, especially for big companies.

In fact, that small percent might represent only one or two campaigns during the course of an annual budget. One or two campaigns will limit their experience and knowledge base even more.

Small business owners in particular have more questions and objections. They have a lot to learn about the environment.

Online Sellers Have Much to Learn

Likewise, online publishers and others who sell website advertising have a lot to learn about how to sell. Many of us have learned that people who have not sold online before need as much as six months to learn everything they need to know about:

• Pricing
• Sales cycle
• Questions
• Objections
• Performance
• Retention

Online sellers are well-advised to provide a guaranteed sales commission for at least three to six months if the account executive is building a new territory or taking over one that is weak or relatively new.

Account executives — or publishers if they are lone rangers — often become truly effective at least 12 to 18 months into the position.

Client education is time-consuming and at times frustrating. Some potential clients literally may take years finally to make the commitment. But client education ultimately is a long-term investment that delivers long-term relationships.

Direct Sales Pricing Impact

The labor that goes into directly selling online advertising means that the price for the campaign must be quite a bit higher than what a site gets from a network.

For example, Google AdSense takes 32 percent of the total revenue it obtains. It means the partner site gets 68 percent of the original sale. So a site that gets a $10 page net RPM from Google AdSense needs to directly sell the same campaign for $14.70.