Will That “Good” Media Sales Deal Pressure Your Inventory?

media sales yield management

Not every offer to buy a large amount of inventory is a jewel. Use your media sales CRM and yield management software to decide which deals sparkle!
Interior of Bright’s Jewelry Store, Duluth, Minnesota, 1910. University of Minnesota Libraries, Berman Upper Midwest Jewish Archives.

One Thursday afternoon at the end of January, I got a call from a big-box jeweler that we had heard was coming to town. They wanted to discuss an annual: they needed a high number of spots to run in these time frames, they could give flexibility on this percent of them, and they were willing to pay this much ($yeah$ for the total contract, ouch for the cost per spot!). Only thing was, the deal had to be done by Friday COB so they could get on the air next week.

The account manager was ecstatic. The general manager was cautiously optimistic. The traffic director went home with a headache. I was left to weigh the pros and cons:

  • The pros: it was a big contract and would keep money off of our competitors. There was some flexibility. It was an annual.
  • The cons: it would eat up our very limited inventory at a lower cost than average, potentially blocking out other potential clients willing to pay more.

As the account manager calculated their commission and was already going to the bank with the bonus for exceeding their goals; I was frantically looking at pacing last year, pacing this year, calculating AURs and future AURs if we took this deal. What would a bump rate have to be in October and November? How would this impact our political rate? How much closer to budget would this “found money” put us, or would it cost us down the road? The clock was ticking.

I give it up to the client for doing their homework and having a well-planned negotiating strategy. They knew the end of the month for a sales manager is much like what a college basketball coach experiences this time of year – will we make it? By putting a deadline on their offer, they banked on the fact we may not have the time or resources to get the information to make a non-emotional decision. And by getting the account manager excited, they had placed an advocate in the station’s camp.

As I now work with a media sales CRM and yield management software that has those reports and calculations a few clicks away, I realize that, as a media sales manager, I made some inventory decisions that were sound, and I made some that were based purely on timing and a we’ll-deal-with-it-when-we-have-to philosophy. Hindsight being what it is, I learned the best outcomes came when I did the following:

  • Step back. The AE is coming at you. You are feeling the pinch of the end of the month. There is a deadline. But resist the urge to drop everything and get immersed in the drama of a potential big piece of business. If you step back, you will be able to see the entire landscape and won’t be lost in the forest looking only at trees.
  • Use your tools. If you have a comprehensive Yield system, you are ahead of the game. If not, gathering the information you need may take longer and require more manpower, but don’t take a shortcut. You need to make an informed decision.
  • Discuss the pros and cons with the team. Your GM probably has that big-picture view already, and is a great resource. Your programming people may also have insight: this advertiser will be a good one to be aligned with and may be good for promotional tie-ins. Or, this advertiser may not be the best fit for our target audience. Your traffic director may say that, given the flexibility, this will be a piece of cake to manage, or every week/month will be a nightmare and he will end up staying late. If you get more positive feedback and, hopefully, some buy-in from your team, any future bumps in the road will be shared, rather than have all fingers pointing at you and your bone-headed unilateral decision.
  • Be sure you will be able to keep your word. If you take the deal, be ready to deal with the consequences later in the year. Don’t come back to this client at a time that may be crucial to their success and tell them you aren’t able to run their spots because of demand on your inventory. You took their money in the lean months, so live up to your end of the deal. Also, consider your current key customers, many of whom are probably paying higher rates. Be sure you keep their deals, too, because they are what made you successful before this advertiser came along.
  • Care, but not too much. What media sales manager DOESN’T want to grab the order waved under their nose?! But the sales manager is responsible for what happens with the inventory. If this deal will jeopardize your rate integrity, your spot placement with key clients, your needed-AUR in high demand months – as hard as it may be, you may have to decline it.

If you don’t take the deal, be empathetic to your account manager. In their mind at that moment, you have reached into their wallet and removed those dreamed-of $100 bills. And if you do take the deal, have a chat with that account manager about renegotiated goals for the rest of the year.

If you made an informed decision, never regret it.

By Kitty Malone, Efficio Solutions Manager of Client Services




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By | 2015-12-24T15:05:52+00:00 March 12th, 2014|Blog, Yield Management|0 Comments