Media with Digital-only Sales Staff Do Better

Recently, a number of traditional media companies have consolidated offline and online ad sales forces.  A new report from Borrell Associates suggests that might be another poor decision on their part.  Their survey of local sales managers suggests that media companies with dedicated digital ad sales staffs outperform those with a combined staff by a factor of 2.5 to 1 in terms of gross revenues per rep ($185,000 vs. $73,300).  For TV stations, the difference was even greater, almost a three to one difference ($208,200 vs. $70,300).

“It’s clear that having a staff dedicated to selling online advertising -- and combining it with the efforts of the legacy media sales force -- drives more digital revenues. But what’s not clear is how many online-only AEs might be needed,” states the “Assessing Local Digital Sales Forces” report. Some legacy media companies with five digital-only reps generated the same amount of online revenue as those with 20.

 The survey found that newspapers were the only media segment where more than half of outlets reported having sales staff dedicated to digital sales (40% of TV stations did, but only 11% of radio stations).
  The report found that digital reps were paid better (averaging $44K vs $35.5 for converged reps), and were more likely to be characterized as having "Excellent' or "Outstanding" motivation (72% of digital reps vs. 18% of regular sales staff), and of having a better understanding of customer needs (81% good or better for digital reps, vs. 49% for other sales reps).  This may be related, in part, to the report's finding that many media companies are paying higher commissions to digital than traditional reps as a result of their push to increase digital advertising revenues.
  The Borrell study also noted that having completely separate sales divisions was not as helpful as having reps who specialized in digital sales within a combined sales force.

“It’s clear that those with completely separate divisions have fumbled badly, leaving large amounts of money on the table by failing to leverage their existing sales forces.” At the same time, those with fully converged operations with no digital-only sellers mixed in “have shown pallid revenue growth.”

 Sources -  Media Companies with Digital-Only Sales Staff Perform Better,  OnlineMediaDaily