There’s a scientific theory called Occam’s Razor. It essentially states that “simpler solutions are more likely to be correct than complex ones.”
OK, William of Occam, who advanced this idea, lived from 1287-1347, so this isn’t exactly modern management thinking. But it might have a lesson for us.
Take growing local business at TV stations. I think there are some simpler solutions that if implemented effectively, I believe can make a big difference.
Broken down to its simplest, the local sales plan might look like this:
We must make A LOT more sales calls and presentations. Not just a few more… a LOT more.
- How many AE’s should you add to do that?
- Are there ways to get existing staff to make more calls?
- Do even the “big list” veterans have to do new business? Is that enforced?
- Are you measuring the # of calls and presentations each month?
We have to increase our closing % on new business!
- But first you have to know what it is today. Most of us don’t.
- It’s incredibly easy to increase closing percentages by 5-8%. Simply require more success stories and ROI analysis in each presentation to reduce the client’s risk.
- We should make our AE’s do new business by category so they become experts in a category. Then, they’ll be able to conduct way better diagnosis calls. Great diagnosis calls are the foundation of increased closing percentages.
- I run a sales training company. We can help you do this, but believe me, many of you know how to do this as well. However, first you have to track where your team is today, so you can tell if your training is working.
- By the way, you might calculate what a 5% increase in your closing percentage would do for your revenue. If you run a big group, you’re talking millions of dollars.
We must reduce churn on new business.
- The number of new business clients that only use us for a couple of months is SCARY. That churn causes a huge waste of resources. The number of hours it takes to find a qualified prospect and get them using our platforms is way more than most AE’s think. They always forget how many prospecting calls and meetings they had with non-buyers before they got a prospect that was closed. So, when a client is “one and done” it’s horrible for the station, the AE, and that client.
- New business is only profitable on the 2nd and 3rd order. But if we don’t sell the client enough on the first order, we don’t get a second chance.
- Again, I think the solution is pretty simple.
- Make sure every seller knows how much spend it takes per month for 3 months for a client to have a strong sense of results. Every sales staff can tell me that number. Depending on market size, it can go from $3K per month for 3 months in a smaller market to $25K per month for 3 months in a Top 10 market. But every staff knows that number from their experience putting people on and seeing (or not seeing) results.
- Then… STOP paying new business commissions on sales that are below the minimum threshold. I don’t want to get back on that soapbox again, but underselling is one of our industry’s biggest problems. And, as leaders, we’ve helped create the issue by paying high commissions on small new business orders that likely won’t renew.
We must have a local car dealer strategy that works.
- This is a little more complicated. If we do everything else right and lose our dealer revenue, we’re in big trouble. So, this is a biggie.
- I believe there are two prongs:
#1 is General to General relationships between the station GM and the owners/GM’s of the stores. That buys access, which is something that regular readers of this column know I write about a lot and feel strongly is essential to our success, and not just with car dealers.
#2 is being able to provide tangible proof that TV drives traffic to the dealer’s website with the right message. Almost every time we see a dealer’s Google analytics, we have a great story. But many dealers won’t give us access. That’s why attribution tools are going to be important in this category.
- Unfortunately, we’re not likely to see huge digital revenue in this category. While there are lots of efforts and I’ve heard some stories, there’s a lot of factory pressure on dealers to use approved vendors. Plus, dozens of companies are totally focused on the dealer vertical. Selling digital to dealers is tougher than with other categories, which makes keeping dealers sold on the power of our products difficult.
The late Zig Ziglar wasn’t as ancient as William of Occam, but he, too, offered advice designed to simplify the achievement of goals: “It’s a cinch by the inch. It’s hard by the yard.”
If we just focused our attention, energy, and accountability on the specifics of the four areas outlined above, I’m positive it can make a difference. However, I’m afraid that there is always a tendency to over-complicate things.
Maybe it doesn’t have to be that hard.
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