Print’s complicated. Newspapers are complicated. Selling broadcast commercials, that’s complicated business and then you throw digital marketing into the mix and it can get really complicated.
Jeremy / Lloyd
Hi this is Lloyd, and I’m Jeremy, and you’re watching Broadsheet: The Business of News.
J: Last time on Broadsheet, we heard about how newspapers can act more like startups, to achieve more startup like results. That includes some successes, some iterations, and yes, even some failures.
This time on Broadsheet, we’re going to be talking about how to set up an effective print and digital sales organization in your market.
L: This is a question we get all the time, and there’s not an easy answer to it, because I think it varies depending on the size of your organization, who you are, even your internal company culture. So we’re going to look at a lot of different things from a lot of different folks, and the first one we’re going to start with is the separate approach.
Reps have their own set of challenges and issues and things that they’re focused on and they’re commission based, so they’ll tend to sell what’s going to put the most money in their pocket which only makes sense. That’s how they’re incentivized, so it makes sense that that’s how they respond.
I’d like to say that we have that all figured out. That we have figured out what our rep ratio should be and what that looks like and what’s going to be most effective, but it’s a work in progress because we know that ideally we’d love to have this super-uber rep that just knew all products and knew them inside and out and was able to go out and talk with a customer and immediately identify what the right mix would be to solve their marketing needs and be able to present that right on the spot and then be able really support it and sell it. That would be ideal.
The main reason we went into a dedicated digital only force is that we realized that although we were doing a great job in terms of the print, having relationships, maintaining relationships, we still weren’t reaching a large part of the market, especially on the small and medium sized businesses. There was tons and tons of opportunity out there that we simply were not meeting with our current staff. We created a dedicated digital only force and we’ve trained them to go after this new business. Typically, it’s what could be considered as nontraditional business. It’s businesses that don’t typically go to a newspaper like your B2Bs. Also, there’s a lot of other businesses that don’t ever use print publications so we wanted a force who could go out, talk to those people, be able to explain that, “Listen, we are a big publishing firm, but we also have a digital services arm that’s available to you with full fledged web development capabilities, and ways to get you to be found in your market.”
Last year, we created a new structure with J. Tom Shaw leading it. He has a digital staff, and then he also works with the legacy newspaper staffs, and he has strategies for each, something that’s going to work for a legacy account executive, might not work for digital account executive like here and vice versa. That increased focus on digital revenue has been a real boost to us.
Our digital marketing team which sells just digital services and no other part started in earnest, at the beginning of this year. We have gone back and forth in years past between, “Should we have digital focus on a separate team or the core staff?” We determined towards the later part of last year that the answer is both.
Gordon Borrell has been talking about that. We’ve seen other examples out there in the world, and we think you just have to do both. You’ve got to rely on your existing relationships with the core staff, but there’s only so many things that they’re able to truly go out and focus on selling, so you also need that separate staff.
The way we look at the business, I thought we come up with this genius strategic planning thing, and then about a week after that I found two or three other companies pretty much had come out with the same strategy. We look at it from, called our “Four Corners.”
The first corner is to continue to manage the legacy business to get as much audience and revenues you can. The second corner is digital, to launch new digital initiatives, get more revenue from those things. Then the third is to acquire or to launch new products. The fourth corner is to make sure our business is structured to support those three. Those things are ongoing and for the foreseeable future, that’s going to be our focus.
When I’m looking at the success of the digital only team and when my boss and our company is looking at that, what we’re looking for right now is revenue growth that’s profitable. We’re not going to lose money, but we’re willing to be more aggressive in order to grow that revenue. It’s a pretty safe bet in this space that almost all of this is true new revenue.
With the digital only team, they have no existing accounts. They’re only going after new business, and so every piece of new business that they get is an opportunity to grow into other solutions and start a long-term relationship. Right now, for this year, what I’m looking at is revenue growth that’s profitable. As this matures, we’ll of course be looking at, “Where do we get the profitability in line with some of our other products?”
We did some revenue projections looking out three years, and as you might imagine, print advertising three years from now would be significantly reduced. Then we also looked at our niche initiatives and digital, some of the services we provide, including commercial printing and overall the business looked okay, not great. It you take it and you look at it as one business, you’ll say, well revenue is going to be flat or down a little bit in the next three years, but then if you look at your digital business, your niche business, some of the other services you can provide and you say, “Those are growing. That looks great.” You can’t get out of the legacy business. We look at it for our company, it’s still well into seven figures 3 years from now, a huge part of our business. We have to continue to do just that, we can’t just walk away from that revenue.
There’s a dotted line to me, so everyone keeps track with what the latest initiatives are, but they’re really there embedded with the core teams. The digital only team is completely separate from all of that. They’re not tied to anyone operation, and they only report to me. There’s no one that is balancing a print rep’s desires with this new digital rep and having to decide between the two.
What we’re really trying to figure out now is “What’s the appropriate interaction between a legacy rep or a core rep who wants to hand something over for the digital team to sell?” Whether that is a spiff or some sort of commission or what it is, we’re still sorting that out. Right now, all of our reps, everyone in the advertising side of our company is expected to sell digital, so it’s hard for someone who’s trained and being told you need to sell a website to hand it off to someone else.
On the other hand, if you’ve got ten deadlines today and the website is just a little bit different of a sale than say a print ad schedule, then it makes sense to bring in someone and have them focus on that part of it, so we’re navigating through that right now. As far as a blanket statement or territories or that, the digital marketing team can go into any operation, into any territory, and as long as that client isn’t invested in that digital product that they’re pitching, they can go after it.
Lloyd / Jeremy
J: So we’ve heard about some of the challenges and successes of a separated print and digital sales model.
L: Yea, it is a great model, if you can afford it, but it’s hard to get off the ground and it is expensive. Probably one of the more common thing that we see, is where we take just an existing print sales rep and we train them how to sell digital.
J: Especially from small newspapers. So next up we’re going to hear from folks from Schurz Media, LA Times, and Civitas Media about how they’ve gone about this process.
Our goal is to raise every sales person’s level up to the level of competency, being able to speak to digital as well as print, because we’re really selling more than just newspaper these days. My team is imbedded with those teams and they’re goal is to educate them, to train them, to inspire them, to give them ideas on what to go after, to go on four-legged calls with them, and basically to help raise their level of proficiency at selling digital and integrated media.
We have one smaller team of people who focus specifically on digital services and that’s basically website building, search engine optimization, search engine marketing, and social media management, only if it comes to anything more expansive in regards to display advertising, ad mail programs, that’s our expanded team that has access to selling all that expanded suite of products.
One of the challenges that has been here almost since the beginning of attempts to sell digital and remains today, is we keep adding things to the mix. It’s just helping sales reps keep everything straight. They have so much to sell and so many advertisers to see, that’s the other thing. It’s really hard to keep them focused on, “Let’s figure out how to bundle all this together, let’s figure out how to take what works best for the advertiser,” as opposed to, “Let’s just go see if we can sell them something.”
We’ve struggled a lot just trying to understand how to set up a digital-only sales team. We’ve tried different models and can’t claim great success with any of them. Right now we work on the idea that “everybody sells everything.” We don’t have a dedicated digital team or dedicated print team, everybody carries all of these things in their toolbox and it’s pretty tough. I don’t know … It’s one of the things I asked about everywhere I go. When I’m talking to another digital director or a team of digital people, I ask, “How do you sell, how do you break that up and who do you designate to do what?” I don’t think that’s been answered really well yet.
David Lee Spencer
Day-to-day I’m in different locations throughout the country, I travel to 24 of our locations and I help the sales staff get better at talking about it, pitching the product to their customers, and just explaining it. It’s new to a lot of our reps that have been in the traditional newspaper industry. They’re really print conscious. We really just want them to develop that side of it and feel comfortable. I’m really like a resource to them. Whatever they need to be successful, I help them get it.
I’m in Hillsboro, Ohio this week. The biggest thing I’ve just been trying to tell the reps here is pitch digital. Talk about it, let people know what you’ve got. Reps know subscriptions. They know, “Okay, like here, the population is 10,000.” They’re doing pretty good here, 50%, 5,000 people are subscribed to the paper. Pretty good.
But then you say, “How many people go see your website?” Some of them don’t know that there are 52,000 unique visitors a month that we’re averaging here. That’s huge.
You know, everybody has a phone, has a Smartphone, has a computer at house and at work, and they’re constantly on these devices, and they check in, and want to see what’s going on in their community. That’s where the huge opportunity is.
If there’s one mistake that I’ve seen, not just our company, but other companies make along the way with digital, it’s thinking of it as digital, as we need technical folks, we need people who are brand advertiser oriented folks. Ultimately, the opportunity in these local markets, especially with newspapers, is it’s with local advertisers, it’s with retailers, it’s service providers, understanding what’s going in their heads with regard to their business and needing to reach their customers with what kind of message is pivotal.
We believe that newspaper ad reps are simply integrated marketing consultants for their customers. They’re effectively there to bring new solutions for their customers and help their customers understand what the best thing is for them to do.
So what that means is, that when they’re selling a print ad, they don’t have to go to the customer and say, “Hey, listen, here’s a diagram of a printing press, and this is how this works, and here’s how the colors hit the pages…” no, they don’t do any of that. They say, “Hey, this is why this is going to be good for your business.” We frame digital products and services in the same way in our trainings.
At the end of the day, we’re selling audience. We want the small businesses to know that we are going to connect them with their audience and help them get their message out there. So it doesn’t matter if you’re selling a print ad, or a search engine optimization campaign, SEM, or even content creation for a website, the point is that you’re going to help your SMB advertisers connect with their customers.
Lloyd / Jeremy
J: While this is often the fastest way for many organizations to go to market with a digital strategy, as you can see, sometimes reps can get overloaded with product sets and they don’t necessarily know which products they should be selling to which customer.
L: So that kind of brings us to the third approach which is one of my favorites, which is taking an expert and inserting them among these traditional sales reps. One of the things I really like about traditional sales reps is they have the relationships, they have the passion, you know a lot of folks have worked for 20-30 years with the same customers and there’s value there.
L: They don’t have to know, like Earl said, they don’t have to know how a website works or how http works, you can bring in an external expert that explains that and helps them sell it.
J: So next up we’re going to hear from folks at AdTaxi, U-T San Diego, and the Dallas Morning News about how they’ve gone to market with this particular strategy.
The challenges around to how to structure the sales team are not unique to the Dallas Morning News, as we go to market with different digital properties in our portfolios with regards to social media, it was a matter of figuring out a way to leverage the 5,000 local relationships the Dallas Morning News have with those clients and making those reps feel very comfortable in talking about social media and content marketing solutions and how those solutions can really help drive businesses forward and help basically boost their bottom lines.
When we think about that, we mean that on the macro side of the equation, the local regional ad spending is moving to programmatic media across mobile, video and display, email, search, content marketing, we think that market is going to grow from about 45 billion today in the US to about 75 billion by 2017. That’s by far the fastest growth trend in digital advertising.
On the more micro side of the equation, we have a lot of trust between our local media brands and local audiences like the Denver Post in the Denver audience for instance.
Conversely, we also have a lot of trust with our local sales forces and the businesses that they represent. In between that micro and macro opportunity, there’s a big execution gap. What Ad Taxi as a business tries to do is help partners whether it be publishing, broadcast companies or clients direct, close that gap as fast as humanly possible.
Ad Taxi does carry its own sales force but our mission is to enable the local sellers to be able to operate on their own independently and drive this kind of revenue growth and solution for their client without us. What we do is essentially go in, train them up, get them moving, go on the first round of sales calls, help them through the relationship and then basically throw them in the pool and force them to teach themselves to fish.
We do have continued sales pressure in each of these markets, but typically we have an Ad Taxi leader on the floor who owns the revenue growth for that sales floor and is dedicated to helping that sales force increase their digital acumen.
They’re there as a resource. They’re not there as a digital secretary so to speak to do the digital work. That typically can happen. They’re there to be the kind of the evangelist for lack of a better word around this audience model.
The way the sales structure looks at the Dallas Morning News is not unlike those at other media companies I worked at for many years.
We have traditional legacy newspaper reps. We call those our SMCs, Sales and Marketing Consultants. They are 60 people strong. Then we have a small army of digital hunters as we call them and those are our DSMCs. They’re a group of ten and they work alongside those core SMCs to go out and make four-legged sales calls. Then you sprinkle in a couple catalysts. Those are people that specialize in different product offerings such as Speakeasy. There are Speakeasy catalysts.
It’s core reps, digital reps, and then two different sets of catalysts. On any given call just from a rep perspective you could have three to four reps outside of managers and GMs. It’s quite a layer of structure at this point.
Yeah, our sales structure is really focused on having our core reps be multimedia reps. The ability for them to sit down with an advertiser and present an all-encompassing media package.
Certainly, where we have an advertiser that might have more of an interest in digital, we’ll bring in a digital specialist. If someone has a particular interest in video, we’ll bring in a video specialist, but at the end of the day, we’re requiring our multimedia reps to go and sell the whole package.
As you probably know, the fastest way to grow revenue is to upsell an existing client. A lot of those relationships are held with the local newspaper sales staff and that business. Most of that time, that traditional newspaper sales staff or broadcast sales staff doesn’t have the digital acumen to provide these kinds of solution.
What ends up happening is we add another trusted guy as we call them to that relationship, which is a savvy digital person that goes on a sales call and crafts that media mix. Once that client has that solution, those two work on it together, and as the traditional reps sees this happen a few times, they slowly begin to learn to fish so to speak and operate on their own. That’s how the business scales.
We’re transforming that past relationship around buying a TV spot or buying a newspaper ad to buying a cohesive marketing solution that’s driven via that digital acumen to push that legacy rep in the right direction.
What we’ve decided to do is look at we really need to have some digital marketing experts on staff. We have Fusionfarm agency reps right now that focus on just going out and selling non-legacy customers. If they’re already working with our legacy reps, then they don’t work with them, but what they do is go out and look for new business that we’re not currently working with as a company.
What we think we’ve kind of found out the right thing to do now is to take really good sellers that understand what’s going on, but then support them with people who have that deep digital knowledge, and not necessarily always being four-legged calls and having a digital rep go along with them to basically go in and try to close a sale on digital, but to have those folks go along and be a trainer in the field and help them understand the value of those products to make sure that we aren’t missing any opportunities. It’s an extra set of eyeballs, and so our sales managers are up to speed on that, but we’ve also incorporated digital reps to go along and dedicated specifically to the ad teams.
The fact that you don’t have to be the expert on all services, that you can bring someone in to be that expert and still not lose credibility, that’s probably been our biggest challenge because we can develop all the services and products that we want, but if they’re not getting taken to market by the sales reps, then it’s not going to work.
They’re very afraid of losing credibility. That’s the bottom line. The reps have built these relationships with these clients and they feel that they’re experts in what they’ve been selling them and so there’s a real fear that they’re going to be asked a question that they can’t answer. When they can’t answer the question, they feel like they’re losing credibility rather than say, “You know what? I’m not the expert on this piece of it, but I have someone back at the office that is. Let me bring those folk out or let me connect you. Let me get those answers for you.”
That’s really what we’re working with the reps on, is to say, you don’t have to be the expert on everything. You’re not going to lose credibility if you have someone on your team that can be that expert.
We also know that there are a significant number of customers out there who have not a lot of interest in legacy products, that don’t care about or want to be in the paper. They don’t watch the 6:00 news. Those people are, however, interested in social. They really want a robust website. We actually have a team of people specifically tasked with going out and finding new customers that work alongside the ad reps that are branded Fusionfarm to be able to go out and talk directly to those people that that’s all they really care about. We’re starting to make some really good traction with those folks, as well as having our existing advertisers come along with the ride.
The fear is always that they’re going to switch revenue, so we’re going to lose print revenue or we’re going to lose broadcast revenue if we sell digital. To a certain degree, that happens because they see that rep that comes in and think, that’s my Gazette rep or that’s my KCRG rep, and so they’re looking at their budget as, “This is my Gazette budget or my KCRG budget, so I’m going to take a little out of this to fund this new thing you want me to try and we’ll see and it’s all coming out of the same budget.”
What we’re trying to work with the reps on is that we know, we actually subscribe to the Borrell Data, and we know in market what’s being spent and what’s being spent in our market, both with other companies within our market and then also outside of our market the dollars by category that are being spent. We know we’re not capturing all of those dollars. There’s money to be had in digital marketing that they’re not spending with us.
We really want the reps to focus on not just going in and talking about, “Here’s what we think you need to do,” but also talking about what is your marketing budget overall and really trying to expand their thinking into, “I’m not asking you to take money from your print or your broadcast, what I’m asking you to do is think about how you currently market online.” What are you currently doing for directory updates and for social media marketing? That’s thinking outside of the box of just working with my rep for print or digital.
What we found really beneficial with that is having some separate Fusionfarm reps that actually go out and can begin with a different language, so we’re not beginning with just what we’ve worked with before on print, or what we’ve worked with before on broadcast.
It was once told to me, that good salespeople are not really trained, but they’re born. So if you have a little bit of sales DNA and you’ve already got that raw skillset, that’s a great place to start. So even before you get into training and education with ad reps, I think the first thing you need to do is you need to look around and say, “Do I have a bunch of sellers here?” and if I have sellers here, I can take them and I can train them on different subject matter and can create a culture of doing that so they’re accustomed to shifting their processes and working and learning with new products, it’ll improve the feedback.
So education’s important, but I think even before education, you’ve got to hire sellers.
They … great valuation sustain businesses and newspapers because there is kind of a level of expectation or entitlement, the sale evades them. They need to be more aggressive on sales. A lot of newspapers don’t spend enough money on sales.
They have treated sales as a cost, as an expense. In my estimation, a healthy newspaper should spend 20% of its gross revenue on sales. I think you will find newspapers that spend 3%-5%. I think you can spend more than that.
The point is that there is no aggressive sales model. They used to have one but they don’t have any more because they became monopolies. They just took orders. They took the grocery store to the Cubs game, and that’s how they got their deal.
Lloyd / Jeremy
J: So Brian actually raises a really interesting point here, which is that newspapers have acted more like account managers than they have like sales organizations, at least traditionally. What that means is that they have really great relationships with a large number of legacy clients, but what they’re missing is the hunter aspect of going and acquiring new accounts and bringing them into the fold. We’ve actually seen the digital champion model work really well at this, bringing in some new blood and challenging the salespeople on the print side to bring new products into their customers.
L: Yea, it’s hard to balance, right? I mean, it’s hard to make it work because you do have all the questions, like, “Is this person taking my customer,” and all those things, but honestly, if you look at it from the account management / salesperson perspective that you’re talking about, that can be a good thing.
L: That can reinvigorate the organization.
J: And it’s not often that once you’ve sold somebody something, you have the opportunity to go and present new products and services and this is actually a nice Trojan Horse to bring these digital products into these accounts.
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L: Oh, and by the way, our next episode is going to feature talking about teaching your customers and how that is really more of a sales process. In fact, we’re going to hear from the Denver Post and how they have created this seminar model, and what that’s done, it’s allowed that to just skip the sales process if you can teach your customers what they need to be doing, then they just ask you to do it.
J: That’s a really good point. So, we’ll see you next time.