Lessons From TV And Mag Sales: Quality Content, 'Company You Keep' Still Matter
I was recently asked about how to counter a price objection from a small advertiser. I spend a lot of time in rooms with groups of salespeople helping them think about ways to fight the sales fight in the toughest environment I have ever known. Of course the price objection happens across the board; from big and small advertisers and in the business-to-business market as well as consumer market. There are so many choices for advertisers, and there seems to be a whole new media category every year; location-based social marketing, anyone?
How can a digital salesperson counter the objection that the buyer can buy around her property? Customers with price objections have been around since the biblical flood, but buyers have never had more alternatives than today.
Publishers of high quality content seek to hold the line on advertising pricing, while blog networks and aggregators offer lower pricing and advertising networks and social media offer even lower pricing and extravagant claims for reach.
For years owners of premium broadcast content like sports and hit TV shows have successfully maintained their status and both their larger audiences and their higher costs per thousand (CPMs), while advertisers had the opportunity to buy around them. Can we learn anything from them? While broadcast and cable alternatives multiplied, ad prices for hit shows went only one way: up. We went from three networks to five, and from a dozen cable channels to hundreds, but it wasn't until the near-economic melt-down following the housing bubble that TV pricing took a hit.
Why have owners of top TV content been able to hold the line and demand an advertising premium? Traditional advertisers can buy television advertising at very low CPMs across networks and cable networks. They can even buy around the Super Bowl. But these same advertisers spend top dollar to buy prime time or other special event programming. Whether it is the Super Bowl or "60 Minutes" or "Mad Men," the best quality demands serious premium CPMs because the broadcast industry believes in their own value proposition and they have learned how to negotiate.
Readers and viewers are aware of the quality and value of the content they consume and they attribute more trust -- if unconsciously -- to the advertisers in those environments. We know this instinctively, but the Online Publishers Association published research to back it up last June: "A Sense of Place" compared branded environments to portals and social media sites. The research conducted by Harris Associates finds that "Sites with trusted content correlate strongly with the sites' advertisers being perceived as reputable."
And because we are known by the company we keep, advertisers know (but sometimes need to be reminded) that they too are known by the company they keep. This is the second supporting value for premium pricing in first-class online media environments. When I started in sales in magazines, the first thing a prospect would do was open the magazine and page through it to see who else was advertising. They knew they were going to be judged by the company they kept. This is what also explains why Vogue can still publish a telephone-book-sized September issue. The advertisers want to be associated with their peers. And for good reason. That is why Mercedes will be interested if they see Tiffany advertising, and it's why Estee Lauder will be interested if they see Donna Karan advertising in a particular property.
Only one part of the solution for supporting quality media environments is in the research or the logic. Even more important is the matter of a self-confidence that sellers need to build for themselves. While it's true that advertisers have more alternatives than ever before, it is also true that online salespeople have more prospects than ever before. Salespeople need to develop their territories and their prospect lists with this in mind. Hanging their hopes on a few "good" prospects is a formula for disappointment. A salesperson doesn't have to say yes to a price concession demand from the person in front of them unless they have no other alternatives. If they have lots of prospects, salespeople will know that they will find another buyer.
Smart media companies like ESPN and TBS made the decision a few years ago to eliminate the ad-network ads from their sites. Yes, that made it harder to fill unsold inventory, but it eliminated the buyers who were trying to buy the brand without paying the price. The best consumers still want the best content. And the value of that content and its environment is there -- only if sales people can explain how the value is delivered, and sales management demands it.