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Advertising Sales Mismanagement, Part II

Posted on Thursday, August 25, 2011 at 10:39 AM

How to boost sales through improvements in your sales management approaches.

By William Dunkerley

In Part I we discussed reevaluating your ad sales management to increase performance. Strategies for coaching salespeople and a procedure for conducting a competitive analysis were explained in detail. Now we look at some other important components of ad sales management.

Compensation Administration

Compensation is a significant issue. Incentive compensation is widely practiced as a means of motivating salespeople to be more productive. It makes good sense that your best salespeople should be getting superior compensation, but how to administer it is another story. Too often compensation is based largely upon commissions. What I've found is that commission isn't a universal motivator.

Take the case of Richard, for example. He was the top salesperson at a magazine published by a client of mine. His compensation was running 50 percent from salary, 50 percent from commission. To the bane of his publisher, though, Richard would experience periods of decreased productivity. Sometimes the slump may have been related to a seasonal cycle in the industry served by his magazine. At other times Richard was just in a personal slump. To motivate him more, Richard's boss reduced his salary and upped his commission percentage.

The publisher's theory was that the new plan would push Richard to maintain his sales level more consistently. But it didn't. His sales took a nosedive. My recommendation was to take things in the opposite direction: pay him a higher salary than before and lower his commission percentage.

The result? It worked. Richard's sales went back up and his consistency improved greatly.

The moral of this, however, is not that you should lower commissions and increase salaries across the board. What may be a successful compensation formula for one person may not work as well for another. Richard found it stressful that his compensation would change from month to month, sometimes irrespective of the amount of effort he put into his job. And when stressed, his sales productivity plummeted. When relieved of that stress, he shined.

If you tailor a compensation plan to the proclivities of each individual, you may gain in overall sales productivity. Some publishers recoil from this suggestion. They fear that differing compensation formulae for different salespeople may precipitate envy and dissatisfaction among staff. But, if handled properly, that is not necessarily the case.

In general, your publication's compensation policy should be perceived by staff as fair. "Fair" does not necessarily mean a one-size-fits-all approach. It will be fair if your top producer gets top pay. It will be fair if a salesperson's increased performance is rewarded with greater compensation, or if a waning performer gets less. The formula for making those adjustments doesn't have to be the same for each person.

Customer Service

Who handles non-sales communication with the advertisers? This might include obtaining ad files or materials from advertisers, sending out media kits, providing online metrics data, or fielding routine questions. Do you have support personnel to handle these tasks, or are salespeople getting involved themselves? Sometimes, customer service can become a time trap for ad salespeople. They'll argue that they want to give their accounts personal attention, that they want to be sure the communication is handled well, or that their relationship with the advertiser is enhanced by this additional contact. More likely, though, the salesperson is avoiding cold calls or some other undesirable task.

Customer service is important. It needs to be handled competently, promptly, and in a spirit of helpfulness. Usually it is more productive to have support people doing this. That way, you can keep your salespeople focused on closing sales and bringing in more revenue. That will be a clear advantage for all.

Similarly, credit issues are best handled by someone other than the ad sales crew. When deciding whether to extend credit to a new advertiser, someone other than the salesperson should make that decision; otherwise, there is a conflict of interest. The salesperson should be focused on selling. If an advertiser gets behind in payments, it is unwise to have the salesperson make the collection call. The sales relationship should revolve primarily around sales. It will be more productive that way.

Forecasting and Budgeting

Accurate forecasting is important for any magazine. The number of editorial pages is usually based on how many ad pages are sold. That means that editorial needs a good long-range forecast to plan for the development of editorial content. Often, problems arise when forecasts are influenced by wishful thinking. It is far better to base forecasts on established seasonal cycles and long-term trends. Aspirational forecasts will produce faulty data.

That faulty data can be problematic for the advertising department, as well. Many publications make their forecasts and then translate that data into quotas for the sales staff. But when forecasts are aspirational, quotas will be unrealistic -- and that can lead to serious dissatisfaction among the salespeople.

Indeed, quotas are not always the best way of getting salespeople to hit targets, anyway. Active coaching is usually a more productive means. Revenue budgets are, in effect, quotas extended out across the budgeting period. They represent a static approach to dealing with a dynamic variable. In the course of a sales year, there are often chances to sell more than the forecasted amount of space. Quotas can militate against seizing such opportunities. So there is a tension between the need to predict as a basis of resource planning and the desire to capitalize upon opportunities that may emerge. It's a dilemma.

What's the best solution to that dilemma? Acknowledge that forecasts and budgets need to be dynamic, not static. As a budget period unfolds, you'll be constantly receiving new data that can be used to refine your forecasts and reformulate your budgets. Do that. It's not smart to think you're smart enough to predict precisely what will happen, say, fifteen months from now. Take a dynamic approach to it all, and your results will be better.


Your sales team needs to be in a position to explain to prospective advertisers how they will benefit from advertising in your publication. Advertisers can become immune to sales claims made by ad salespeople. Claims that can be proven are more convincing. That's where a research program should come in. But too many publications limit their research to identifying basic audience e demographics. Of course, advertisers will want that information. But an advertiser is going to need convincing that your readers will become buyers. That's why it is important to research your readers' spending habits. What do they buy? When do they buy? How much do they spend? Appropriate answers to these questions can help prove to advertisers why they should be advertising in your publication.

The Postmortem

The final sales management matter I'd like to discuss is what to do when you're finished with each issue. I recommend that you conduct a postmortem. Meet with your ad team and review what's in the issue -- and what's not. Discuss whatever problems salespeople may have encountered in the course of selling the issue, and brainstorm new approaches. This is really an extension of the coaching approach discussed in Part I. It is an opportunity to learn from the experience of selling the most recent issue, to articulate what you've learned so that everyone can profit from it, and to apply what you've learned as you begin selling the next issue. It's a never-ending process!

William Dunkerley is principal of William Dunkerley Publishing Consultants, www.publishinghelp.com.

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