2015 Radio Revenue Gains Threatened By Lack Of Sales Talent

The latest State of Media Sales study reveals areas of focus for improving sales team recruiting and performance

In radio sales, you win with people. You lose with them, too.

73% of radio sales managers say it's getting more difficult to hire quality salespeople, according to the just-released State of Media Sales™ study conducted by the online newsletter Media Sales Today.

In fact, lack of sales talent or competency is now the greatest frustration radio station leadership faces today, cited by more than 62% of radio sales managers and executive managers surveyed from December 2014 to January 2015. Traditional challenges of insufficient budget and corporate expectations rank a distant second and third, respectively.

When we at Sales Development Services talk to many of our 2,000+ media properties across the U.S., the conversation frequently turns to this topic.

I've found there are five common perceptions and misperceptions that make recruiting good salespeople challenging for most radio stations in most markets:

1. Some think it's getting harder to make money in media sales. More than a third of sales and station managers say it is harder to make money in their current positions than it was just one year ago. This finding mirrors the belief of salespeople on the street we surveyed last year. Obviously if good salespeople can't make good money selling your product, they leave.

   This is not just a radio problem; it's a local media problem. And the problem is not account acquisition; it's usually account retention. Media sales teams are often selling enough new business, but if they don't have a retention program, revenue is being lost as fast, or faster, than they can bring it in.

   When considering ways to fix the problem, it's important to keep your mind and your options open. Don't say "I know that (already)…," ask yourself "how GOOD am I at that?"

   So, how good are you at…?

   • Producing results for the advertiser. There's no doubt you want long-term relationships, not just single sales. So make sure your reps focus more on the results of the advertising they sell, rather than pushing the product of the month. There are too many advertising media options for clients, each promising big results, and the advertiser is often too quick to cut bait when the fish aren't biting.
   • Making the right "ask." Too often, reps want to cut rate to make a sale, but when they do, they end up not asking for enough for the campaign to actually work. Not only does this short-change the station, it also makes the account much harder to sell next time.
   • Avoiding "throw-ins." Your reps might be thinking of throwing-in some banner ads or some live reads under the premise of "value added." But remember what you've just read. If they aren't providing enough of it to work, they're just diminishing the value of the product they've "thrown in."
   • Aligning proposals with the advertiser's peak sales seasons. Actually, start these campaigns BEFORE the peak sales season for maximum impact and start selling them at least two months in advance (for most local-direct accounts). If they're calling on accounts they've just heard on another station, they're probably already too late.
2. Some think radio sales are in decline. While 37% of sales managers reported missing their annual goal in 2014, 9 out of 10 are forecasting revenue increases in 2015. The average increase is expected to be between 5-7%.

   In fact, several revenue sources are expected to produce gains for radio in 2015. These include:

   • Healthcare accounts like hospitals, dentists and urgent care centers (72% forecast plus numbers for their stations)
   • Automotive accounts (63%)
   • Promotions/Event Sponsorships/NTR (54%)
   • Restaurants, Food and Beverage accounts (53%)
   • Banks and Financial Services (46%)

   Most radio sales managers expect spending by retail accounts to stay about the same in 2015.

   How good are you at…

   • Recruiting people who already understand these types of businesses or know how to sell to them? A person who knows how to sell to healthcare providers or restaurants might generate more revenue for you than someone with radio sales experience.
   • Making the right online impression? Before they ever get to your office, candidates these days will check out your website and your mobile app (or lack thereof). Your recruiting starts before you ever get to speak/write a word to the candidate. Does your site look like it was designed 10 years ago? Has it been updated recently? And if they didn't look at your website, don't even bother with the interview. (You don't want them.)
3. Some think there's a lot of turnover in radio. Actually, local radio is reporting a lesser problem with sales staff churn -- an average of 19.5% of the staff in 2014 -- than local newspapers or television stations. It was not uncommon for competing media to have turned over 50-60% of their sales teams in 2014. As you know, rep continuity is a big plus for radio in selling to local-direct advertisers.

   How good are you at…

   • Refusing to settle just to get an open position filled? Once you've hired a few salespeople, you probably know who truly has the potential to be great. Go with your gut more than your head or your heart. Don't rationalize your way into hiring a mediocre or non-performer.
   • Setting them up for success? Once they're hired, there has to be a legitimate effort with on-boarding, training and then continuous coaching- - not just on radio, but also on sales, marketing and account strategy in general.
   • Getting radio in their blood. By exposing them to the entire business of radio, you likely increase the chances of keeping them in the business. Let them see the process of how a spot they sell gets produced and on the air. Have a talk show? Interview them on marketing or Small Business Saturday -- or have them be a call screener for a day.
4. Some think advertising is no longer sexy. Our business cards no longer have the prestige they once had. It's always been harder to sell a non-tangible product like advertising, and the better salespeople would rather sell replacement knees, high-tech or anything with a greater wow response at the family barbecue. Most stations don't have the ability to recruit by throwing top-dollar at the best candidates. Unless your station is a top biller in one of the top markets, you can't think like the New York Yankees; you have to think more like the Kansas City Royals -- a club with limited resources that has no choice but to develop their own talent.

   How good are you at…

   • Finding high character and hard working people that you can DEVELOP into strong radio account executives? Of course, you can advertise the position on-air to those who already have a passion for your station, but you may also have to look in non-traditional places like waitresses, baristas, the counter clerk at Enterprise Rent-A-Car or third connections in your own LinkedIn network.
   • Asking (and getting) candidate suggestions from advertisers? The people they suggest will say a lot about what they think of your station and your reps. If they decline to offer any suggestions, that says something too.
   • Looking for the traits that will delight advertisers? The number-one thing advertisers want from a media rep is "someone who knows my business and can bring me relevant sales-producing ideas" (Small Business Marketing Forecast, 2014, Ad-ology Research). This is followed by "someone who knows my customers" and "someone who delivers on their promises." You don't just want hard-working, honest, professional and likeable, you also want "curious" and "caring." Notice that "experienced" isn't as highly regarded by local business owners.
5. Some think everything is going to digital. Digital is expected to increase to 8% of overall sales revenue for local radio in 2015 (up from 4.7% in 2014). But nearly a third of radio sales managers say it has gotten harder to sell digital advertising, as digital agencies, Google, Facebook, and other online pureplays are getting more aggressive in targeting SMB dollars.

   How good are you at…

   • Promoting your LOCAL knowledge? The key advantage local radio has over Google, Facebook and out-of-town owners is LOCAL. You are the experts in your market. You report on the local news, you know the local businesses and you know the nuances of the market.
   • Being consultative? To stand apart from online self-service platforms, you have to offer real value by being consultative on what advertising and digital marketing services will work best for them and resonate with your neighbors -- their desired customers.
   • Arming your staff with LOCAL market research that is relevant to small business and franchise owners? It can't be the latest rah-rah piece on why radio is great from the national trade association. They won't believe anything from a source with a perceived bias toward the media they represent. So give advertisers something of value than can believe in - or end up being just another person with something to sell.

And one more thing about recruiting sales talent…

That leads to another concern we hear about recruiting younger salespeople: They don't just want to know what they'll be doing; they want to know why. And, to continue with the baseball metaphor, that's a fastball right in your wheelhouse. The mission of your sales team is not only to make money for themselves and the station, but also to help their local mom-and-pop businesses survive, thrive and grow. And that's something you should have no problem selling to new recruits.

NOTE: Unless otherwise indicated, all stats in this column are from the 2015 State of Media Sales study by Media Sales Today, December 2014-January 2015. For more insights, download the free whitepaper at MediaSalesToday.com/2015SoMS