Traditional media companies struggle to find the right formula for digital sales. The challenge isn’t really about deciding whether to go with a pure digital only approach v. relying completely on existing legacy sales resources. The decision matrix is much more complex than this binary choice. Publishers need to use their existing sales assets to grow digital revenue. Failing to do so simply isn’t practical for most companies. But publishers also need to bring in more digital expertise and make many important strategic decisions about sales structure.

A new BIA/Kelsey Insight Paper, “Old House vs. New House: Building Optimal Digital Sales Teams,” xamines the challenges involved in building digital teams and finding the optimal sales structure. The report is co-authored by me and Stacey Sedbrook, BIA/Kelsey’s VP of Strategic Sales Consulting, and is the first of several sales-related Insight Papers we will co-author this year.

The report’s executive summary is below and BIA/Kelsey clients can read the full paper by logging into the client portal. The report is also available for purchase.

Traditional media companies struggle with how to build optimal digital sales organizations. The conversation often comes down to a binary choice: should a media organization rely on a digital-only sales force or a multimedia one?

The truth is, it isn’t “either-or.” It’s both. Legacy media companies need to look at segmentation by product, giving legacy sellers inventory that they can easily sell (hint: this tends toward products that are owned and operated by the media company), and leaving more complex and higher value digital sales to digital specialists.

BIA/Kelsey did an analysis using real performance data from a range of local media companies struggling with this sales structure challenge. The message that emerged from this exercise was clear. Yes, digital-only sellers will leave legacy sellers in their dust on a one-to-one comparison. Legacy sellers, however, represent more sales volume and should be a key component in moving organizations from majority legacy revenue to majority digital.

There is a strong body of opinion that legacy sellers are minimally useful in the shift to digital.

“If you are a traditional media company, and you take 20 of your legacy sales reps, maybe one or two will become performers over time,” one senior traditional media sales executive recently told us. “The best approach is to create a separate digital channel, treated as a stand-alone and managed by someone who can work with the core channel. Then use your core channel as a lead source for digital sellers.”

Our experience and analysis show that with the right product segmentation, digital sellers and legacy sellers can complement each other and lead to a better overall outcome than in a digital-only structure.

Traditional media companies need to think more strategically about how to drive digital revenue. While digital specialization is ideal, the investment required to build a digital-only sales force in short order that can drive sufficient sales volume is too high for most traditional media organizations. Therefore legacy sellers will need to play a big role in digital selling, at least in the near term.

Traditional media companies that focus on sales reporting structure, compensation and smart packaging as part of their digital transformation will put themselves in the best position for sustainable success. This Insight Paper examines the arguments for specialization and for using a hybrid approach to digital selling.

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One big trend we are seeing in our Local Commerce Monitor (LCM) findings is that low-spending SMBs are taking advantage of the lower price levels of digital and social media and reducing their overall ad spend. This has big implications for traditional media sellers as well as pure plays trying to find the right go to market strategy to reach smaller spenders at scale.

LCM tracks low-spending and high-spending SMBs separately. We call the low-spending SMBs “Core SMBs”, and define them as those spending less than $25,000 annually on advertising and promotion. In Wave 18, we saw a continuation of the downward pull on ad spending by Core SMBs due to the lower price points of digital media in general and social media in particular. We detail these findings in a new report, “LCM 18: Advertising Trends of Core SMBs,” available to BIA/Kelsey clients.

At around $2,500, average media spend by Core SMBs is down around 17 percent from the $3,000 average spend in 2011. We’re clearly seeing a de-emphasis on paid media, in favor of social media and other ways to engage customers, a trend that became apparent a year ago, in the LCM Wave 17 findings.

With Core SMBs, digital media, particularly social media, showed strength across the board. Core SMBs indicated bold intentions to increase spending on digital media. Social media achieved new heights in reach (69 percent) and spend (25 percent of total spend).

When asked about service models, 48.3 percent of Core SMBs said they preferred the “Do-it-myself” model, as opposed to the “Do-it-with-me” or “Do-it-for-me” models. This strong reading is a key message for companies serving the lower range of the SMB market.

In the section of the LCM survey about channels, we explored several behaviors and attitudes. For instance, we saw a big increase in Core SMBs concentrating their online ad purchases through a single channel. A record 82 percent of Core SMBs report using only one channel for purchasing online ad products. (Note: This metric considers “Do-it-myself” a channel).

At the same time, we also saw numerous differences between Core SMBs and high-spending SMBs. For example, there’s a huge gap in the usage level of online services. Only 12 percent of Core SMBs use some type of CRM system, compared to a full 50 percent of high-spending SMBs. Evaluated along with other data from the LCM survey, findings like this are crucial for companies serving the lower range of the SMB market.

Clients of the BIA/Kelsey Advisory Services can find the full report here. Interested in an excerpt? Download one here.

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Many traditional media companies struggle with how to build their digital sales organizations. Should they recruit a digital only sales force — and if so, what are the pitfalls and best practices? If an organization chooses an integrated model — how do they beat the trap where 80 percent of existing reps retreat to the comfort zone of selling only legacy products?

In February, BIA/Kelsey will release an Insight Paper that addresses the difficult questions surround building digital sales organizations. “Old House vs. New House — Building Optimal Digital Sales Teams,” is co-authored by BIA/Kelsey analysts Charles Laughlin and Stacey Sedbrook. The title refers to the tension between selling digital products via legacy sales teams (the “Old House”) and moving toward selling digital solely through digital-only sales teams (the “New House”).

Laughlin is author of the BIA/Kelsey Insight Paper, “Sales Transformation: Building a Sustainable Model.” Sedbrook is a veteran sales leader who has built digital teams at a host of marquee media brands, including Gannett, The Dallas Morning News, The Houston Chronicle and the Denver Newspaper Agency.

One of the paper’s key messages is that a binary view of the sales structure challenge — pure digital vs. multimedia sellers — oversimplifies the issue.

Yellow Pages publishers, newspapers and radio broadcasters may each find a different right answer to the channel structure questions. And while most legacy sales reps should be able to sell a simple digital package to their customers, it may be unrealistic to ask them to sell complex integrated digital marketing solutions to larger or more sophisticated advertisers.

“Old House vs.New House — Building Optimal Digital Sales Teams” will include interviews with sales leaders representing a variety of viewpoints.

At one end of the opinion spectrum is the case for a rigid division between old and new, where traditional sellers keep the legacy media house standing while a new team of pure digital reps builds the new digital-only house. Deseret Digital Media CEO Clark Gilbert is an articulate evangelist for this point of view. The other end of the sales structures continuum involves using using existing sales assets and relationships to make the transition from legacy to digital. This is where most traditional media organizations at least begin the transformation process.

The report will offer a BIA/Kelsey viewpoint on which models make the most sense for different kinds of organizations.

“Packaging is a big part of success with traditional media reps,” Sedbrook said. “One approach that has been successful is having the legacy team focus on the owned and operated assets – website, email, streaming. These are closely aligned with the brand and easy to bundle.”

Sedbrook says reporting structure is another, perhaps overlooked, critical success factor. “It doesn’t matter if the sales reps are cross media or digital only if they report up to a traditional revenue person,” Sedbrook said. “Digital sellers need to report to somebody with digital expertise.”

Check out this video for an excerpt from a conversation with Sedbrook about some of the paper’s key findings.

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10/23/14: Post updated to include a link to download Stacey Sedbrook’s presentation this week to the Inland Press Association. 

“Change is hard. It takes a lot of effort. Sustaining change is even harder.”

BIA/Kelsey’s Stacey Sedbrook offered a sales transformation clinic this week at the Inland Press Association’s annual conference in Chicago.

The success or failure of any transformation effort is rooted in basic human behavior. Sedbrook led off her talk by breaking down how people respond to change. Understanding and anticipating these reactions will improve the odds for success.

Leaders who can execute and sustain a change initiative are the ones that “remove obstacles,” Sedbrook said. These obstacles can be legacy systems, cumbersome processes, or people who resist change.

“Whenever I work with a client, I ask them three questions. ‘Are you ready for change?’ ‘Are you willing to invest in change?’ You need to invest both time and money. The answer to this question is always, ‘Yes.’ The truth is almost always ‘No.’ And finally, I ask, ‘Are you willing to make the hard personnel decisions?’ Because sometimes that is what it takes.”

Sedbrook is VP of Strategic Sales Consulting at BIA/Kelsey. She helps companies improve their digital sales performance. Inland Press is a trade group that represents smaller newspaper publishers, organizations that often struggle with change.

Sedbrook’s talk touched on the full spectrum of transformation success drivers — platforms and technology, channel structure, bundling versus a la carte, compensation, the product mix, leadership.

One of the most overlooked success drivers is internal communications. “Most organizations under-communicate by 10X,” she said. “For any transformation effort, you need a communications plan.”

By erring on the side of over-communicating — via newsletters, town hall meetings, podcast and so on — you reduce the fear, mistrust and uncertainty that so often gets in the way of change.

Sedbrook said sustaining transformation largely involves overcoming No. 7 on the list of typical responses to change — the tendency to revert to old behaviors. This is achieved by leaders keeping up the pressure and urgency (which involves communication), driving the effort against clear short and long term KPIs and removing obstacles to change.

“You have to be consistent and persistent,” she said.

We will share additional details of Sedbrook’s Sales Transformation Playbook in upcoming blog posts and BIA/Kelsey reports. Click here to download a copy of Sedbrook’s presentation to the Inland Press Association.

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Q. Sales force transformation is a buzz phrase that a lot of companies have seized on. What does it mean to you?

A: It is a buzz phrase, and people are using it interchangeably. In reality, transformation impacts two key things: infrastructure and implementation. For any sales organization, you always are going to want to start with infrastructure and how it impacts implementation — things like communication, fulfilment and escalation.

Q: How smart do media companies really need to be about this? Won’t vendors do it for them?

A: To some degree, we see many companies hoping that third parties, like digital agencies, will handle everything for them. In reality, when you are selling and fulfilling digital, there are a lot of things you need to learn to do on your own. There is no such thing as “do it for me.” There is only do it with me.? A lot of organizations aren’t prepared for that.

Q: In his book, The Innovator’s Dilemma, Clayton Christensen said that disrupters need to establish their new business separately from the old business. Many media companies originally took his advice to heart, but have now merged their digital and traditional units. What is your position?

A: It really depends on what your revenue expectations are. Companies can sell their own digital assets or they can sell audience extension products. For that, they don’t need to hire a dedicated sales force. But when you set your sites higher and are selling more sophisticated products like SEO, SEM, Video and mobile, you will need to hire people who are more knowledgable about the digital space because it’s a different type of sale. And regardless of sales structure, digital revenue should be managed at a higher level by someone who is dedicated to digital. A VP of Advertising is always going to have to spend more time on products and services where there is a critical mass and revenues.

Q: Is it now possible to bypass Feet on the Street? Can you do it all with telemarketing?

A: Again, it really depends on the product or service. Telemarketers can sell small transactional products like directory and email marketing, and websites and packages that might range from $300 to $500. A digital package with a low cost of entry, and a clear value proposition, is easy to sell over the phone. But it is very hard to sell custom services from the sales center. That’s been the focus on a number of digital agencies that have highly trained sales people to sell these services, and others to manage them. Agencies like ReachLocal, Local Edge and Smart Reach Digital are building customer service teams and account management teams.

Q: Are we dating ourselves by talking about “advertisers?” Should we really be talking about “marketers”?

A: It is definitely much more strategic to talk about marketers and marketing. Clients really want us to offer marketing strategy. They don’t just want someone selling them a 1/4 page ad, or a coupon. We need to be mindful that a good marketing campaign involves a lot more than what you are selling. Our clients need to understand where to spend their money first.

Q: You’ve been a digital sales leader with the whole gamut of local media leaders, ranging from Citysearch to top newspaper and radio groups. What will you be doing as BIA/Kelsey’s new VP of Strategic Sales Consulting?

For me, it is really about change management. What we’ve found is that change management never happens successfully unless it starts at the top, where BIA/Kelsey’s client relationships are. The rest of the management team is critical to implementing the change but they need to know their executive team is committed to the effort.

We really like to focus on understanding the needs of the whole organization, and then assess their needs at the middle management level for digital product training and their value proposition for digital. This helps to increase their speed to market. You know what we find? Too many organizations underestimate the level of time and commitment these efforts require.

The post 'It is Really About Change Management': Q&A with Stacey Sedbrook, VP, Strategic Sales Consulting appeared first on BIA/Kelsey - Local Media Watch.

Q. Sales force transformation is a buzz phrase that a lot of companies have seized on. What does it mean to you?

A: It is a buzz phrase, and people are using it interchangeably. In reality, transformation impacts two key things: infrastructure and implementation. For any sales organization, you always are going to want to start with infrastructure and how it impacts implementation — things like communication, fulfilment and escalation.

Q: How smart do media companies really need to be about this? Won’t vendors do it for them?

A: To some degree, we see many companies hoping that third parties, like digital agencies, will handle everything for them. In reality, when you are selling and fulfilling digital, there are a lot of things you need to learn to do on your own. There is no such thing as “do it for me.” There is only do it with me.™ A lot of organizations aren’t prepared for that.

Q: In his book, The Innovator’s Dilemma, Clayton Christensen said that disrupters need to establish their new business separately from the old business. Many media companies originally took his advice to heart, but have now merged their digital and traditional units. What is your position?

A: It really depends on what your revenue expectations are. Companies can sell their own digital assets or they can sell audience extension products. For that, they don’t need to hire a dedicated sales force. But when you set your sites higher and are selling more sophisticated products like SEO, SEM, Video and mobile, you will need to hire people who are more knowledgable about the digital space because it’s a different type of sale. And regardless of sales structure, digital revenue should be managed at a higher level by someone who is dedicated to digital. A VP of Advertising is always going to have to spend more time on products and services where there is a critical mass and revenues.

Q: Is it now possible to bypass Feet on the Street? Can you do it all with telemarketing?

A: Again, it really depends on the product or service. Telemarketers can sell small transactional products like directory and email marketing, and websites and packages that might range from $300 to $500. A digital package with a low cost of entry, and a clear value proposition, is easy to sell over the phone. But it is very hard to sell custom services from the sales center. That’s been the focus on a number of digital agencies that have highly trained sales people to sell these services, and others to manage them. Agencies like ReachLocal, Local Edge and Smart Reach Digital are building customer service teams and account management teams.

Q: Are we dating ourselves by talking about “advertisers?” Should we really be talking about “marketers”?

A: It is definitely much more strategic to talk about marketers and marketing. Clients really want us to offer marketing strategy. They don’t just want someone selling them a 1/4 page ad, or a coupon. We need to be mindful that a good marketing campaign involves a lot more than what you are selling. Our clients need to understand where to spend their money first.

Q: You’ve been a digital sales leader with the whole gamut of local media leaders, ranging from Citysearch to top newspaper and radio groups. What will you be doing as BIA/Kelsey’s new VP of Strategic Sales Consulting?

For me, it is really about change management. What we’ve found is that change management never happens successfully unless it starts at the top, where BIA/Kelsey’s client relationships are. The rest of the management team is critical to implementing the change but they need to know their executive team is committed to the effort.

We really like to focus on understanding the needs of the whole organization, and then assess their needs at the middle management level for digital product training and their value proposition for digital. This helps to increase their speed to market. You know what we find? Too many organizations underestimate the level of time and commitment these efforts require.

The post ‘It is Really About Change Management': Q&A with Stacey Sedbrook, VP, Strategic Sales Consulting appeared first on BIA/Kelsey - Local Media Watch.

Sales Momentum recently published a stat that says $15 million was spent on marketing new products which does not factor in the product vetting process, integration into back office systems, IT support, sales training costs and lost opportunity of poorly executed launch plans which could push that figure north of $25 million. This investment figure was balanced by a recent UCLA study which indicates more than 50% of new products fail.

While many factors contribute to the success or failure of new products such as competitive differentiation, ease of sale, and fulfillment support, one key area BIA/Kelsey has been investigating is the hand off between product marketing and sales. While there is often heavy investment in time and resources discovering, vetting, negotiating and integrating new products within a media company, often there are miscues in translating the product and marketing message into a coherent sales plan and approach. Some of the key areas fumbled include:

• Fully researching and defining the specific target audiences. Many product marketing plans focus on number of products sold by rep by market taken from their business plan revenue models. Once the product development phase is complete, marketing and sales need to work together to develop proper target audience identification, determine how or if the revenue goals can be supported by these audiences, then develop audience specific messages.

• Clearly identifying how the new product fits within existing product portfolios or advertiser bundles. New products are frequently introduced in a vacuum without enough thought on how they will be sold alongside other products, particularly when it comes to introducing digital products alongside traditional media products. Advertisers are confused about the volume of marketing products available, so local media companies have to work to make it obvious as to why the product is being added and the value it brings to their current marketing initiatives.

• Demonstrate how the new product enhances current marketing initiatives or enables the advertiser to reach more prospects. Advertiser budgets only go so far, showing them how a new product increases the effectiveness of the other marketing products they have purchased helps to streamline the sales process, increasing success.

• Focusing too much on features and benefits rather than on customer-focused needs. Products are a series of solutions to support advertiser business needs. The roll out of any product has to keep the needs of advertisers in mind so that solution sets can be recommended to solve their key business growth needs. Sales people often get overwhelmed by the number of media products in their portfolio, moving to viewing products as a portfolio of solutions helps sales people clearly see which products make sense and which products to keep in the sales bag.

BIA/Kelsey’s goal is to dig in and identify the best approaches to a smooth product marketing to sales handoff, as well as how we can help sales teams better strategize on developing sales messaging, strategies to maximize the ROI associated with new product launches to better maximize each product opportunity. We’re interested in talking with companies who are taking innovative approaches to product launches and sales teams who are figuring out how to integrate digital and traditional media products successfully. If your company feels they have something interesting to share, contact me to feature your best practices on our blog.

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No one media organization has completely solved the challenge of traditional to digital sales transformation — but there is an emerging set of common traits and best practices. On Tuesday, we presented some of these elements on a Local Media Association webinar, “Taming the Local Sales Machine.”

The webinar presentation was based on a talk Jed Williams and I gave in February at the Key Executives Mega-Conference in Las Vegas. The conference was a joint effort of the LMA and the Inland Press Association.

To prepare, Jed and I spoke with several local sellers, including newspapers (given the audience) and pure plays, to find out what was working and not working in local sales transformation.

The result was a set of “Common Traits of Successful Sellers” spelled out in the image below. These traits are not all present in all successful sellers, but most of those getting traction in the local marketplace share most of these traits. If we were to pick one that was an absolute requirement it would be “Leadership Commits.” Without this, transformation efforts are dead in the water.

The webinar also shared a few “Actionable Ideas for Sales Transformation” that we picked up in the course of our interviews. These include methods for enforcing accountability, using data to drive sales efficiency and using sales prep platforms to convince buyers they need to keep pace with their competition. We will summarize all of these findings in a Briefing for BIA/Kelsey clients.

Those who missed the webinar can access a replay on the LMA archive.

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The case for local traditional media companies to transform their sales organizations is pretty clear. For years, BIA/Kelsey has been tracking the secular shift from traditional to digital spend through both its Local Media Forecast and Local Commerce Monitor™. The path to genuine transformation is more challenging, fraught with cultural roadblocks, resource constraints and execution challenge piled upon execution challenge.

There are no clear winners yet among traditional sellers making the digital shift. However, best practices are emerging around recruitment and training, incentives, technology and data, and sales methodology. We’ve been out there talking to sellers to unearth these best practices.

This morning, my BIA/Kelsey colleague Jed Williams and I offered the Why and the How of sales transformation to cap of the “Key Executives Mega-Conference” here in Las Vegas. The show is a joint effort of Inland Press and the Local Media Association attended largely by senior newspaper executives.

Williams made the “Why” case with data. For example, BIA/Kelsey has been observing a long-running shift among all local advertisers and newspaper advertisers in particular from spend on traditional advertising to presence and platform services. Increasingly, what local SMBs want to buy is outside the comfort zone of many traditional sellers.

To illustrate the “How” I summarized the key characteristics of successful digital sellers, based on interviews conducted in recent weeks with both traditional sellers getting traditional in digital sales and pure plays that exemplify how to sell digital only products to SMBs, usually through an exclusively inside sales channel.

We boiled it down to five common success traits. There are others for sure, but these five were pretty consistent among the progressive digital sellers we’ve been interviewing.

Leadership Commits — Beyond Lip Service. This notion is widely acknowledged, but perhaps not widely understood. True commitment takes many forms, including investing personal energy in acquiring expert level knowledge; investing in people and technology; and making tough decisions, about products and people.

They Don’t Let Underperformers Stick Around. Committed digital sellers do not allow legacy reps to default to their comfort zone. The insist that they adapt or leave. Having a systematic process for identifying and “transitioning” underperformers is a critical success factor.

They Gather Data — And Listen to What it Tells Them. Data-driven sales is one of the meta-trends in sales transformation. Extensive data and sophisticated analytics can help sales organizations become vastly more efficient and quickly move past people, products and processes that just aren’t working.

They Use Robust Tools. Local digital sellers almost universally arm their local sellers with robust technology, for CRM, sales prep, and building custom presentations on the fly. A transformed sale organization.

The Measure What Matters. Successful sellers understand the KPIs that drive results, and they manage against these. Measuring the behavior that drives results can be more effective than measuring the results themselves.

BIA/Kelsey will summarize its latest findings around sales best practices in an upcoming report.

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The keys to any sales person being effective using LinkedIn are finding the right people with the right connections, leading with insights that are valuable to your target audience, and being able to leverage relationships to lead you to decision makers or other prospects. “There are on average 5.6 decision makers in most organizations and it is important to understand who those people are to be the most effective,” says Koka.

When advising sales teams on effectively using social media sites like LinkedIn, Koka recommends:

1. Build your profile to showcase your skills, insights and experience to build your reputation
2. Develop your network with people who can help you achieve your goals
3. Gather insights that are important to your audience and targets
4. Contribute your insights in meaningful ways within groups and forums

Sales people and sales teams need to understand that buyers are researching sales people and companies before ever allowing them to make a one-on-one connection. Sales people who position themselves as experts, who provide solutions from solid companies, are ultimately more successful than their counterparts who ignore the value of social selling.

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