Hey all!
I've been running a digital radio station for several years and we are just changing formats with the hopes of eventually being able to sell ads. I have two questions and would love your feedback!
1. Will sales reps work on commission only or is salary plus commission a must? (It would be recurring commissions for as long as the advertiser remains a client.)
2. How many TLH (total listener hours) would be an acceptable level before starting to solicit paid ads?
I look forward to hearing your advice!
Mark
I've only been working in radio sales since January of this year, but I was started at salary plus commission. I wouldn't (at this stage of my career) feel at all comfortable working on commission alone, so for me personally the salary is a must. I did have a job once that started me off with a base pay, and as I got better at the job the base pay decreased and the commission increased, so that might be an option as well.
Mark, have you ever worked at a for-profit radio station?
Salespeople have bills. Car payment. House payment. Kids that's need stuff. A successful salesperson cannot ditch their current job to come work for you without feeling confident that those responsibilities will continue to be met.
If you had a list of people already purchasing advertising, the salesperson could base their expectations on that. You don't. Think of this from their point of view.
If you're lucky, you'll find someone as passionate about your product as you are. Perhaps you shouldn't think of it as hiring an employee. It might be better to look for a partner. You handle the programming. Your partner needs to bring business savvy.
Right now, I have more questions than answers. First are you targeting a specific geographic area? I'm assuming you are, and your sales people will be concentrating on local sales. As you probably know, the national ad suppliers aren't going to look at you until you have 10,000 listener hours/month. And that's still way below what I think would be viable to gain attention as a local medium.
There are people here that would be more knowledgable than me on what kind of local circulation you need to be viable. I'm going out on a limb to say you need at 3000 people listening half an hour a day...1500 hrs x 30 = 45,000 listener hours a month from the local area to be taken seriously. And local content is key, otherwise you're just competing against Spotify, and they make lots of money and lose even more money. A big cash churn with vacuum attached.
At work listening will be key. Data streaming limits will inhibit in-car listening. The other problem with on-line music programming is that the more popular you get, your costs for royalties increases in a straight line, unlike broadcast that pays on a revenue based model. The upside: you don't have to pay hundreds of thousands of dollars for a small market station.
I think you need to get your hands dirty and sell your own ads. If you work at another job, try to work a different shift than a standard 8 to 5. Key is get the mornings free, to get more time to get in front of business owners/decision makers.
Mark,
Best way to see the opportunity from a salesperson's perspective is to do the job yourself for 6 months, under the exact conditions you propose for the person you want to hire. Right now, you're likely the best person to tell your station's story. So, if you can succeed in a commission-only sales job, perhaps your candidate can, also. But if you can't...
Exactly what everyone else has said. If you are looking to hire salespeople who will actually sell -- professionals who will work their tails off to educate potential advertisers about your "station" and your brand -- you can not expect them to walk into a great unknown, with no proven sustainability for their future.
Sales isn't an internship, it is a career and if you want a team who will stand beside you, you must stand beside them...
Mark, pure commission is folly; with the rarest of cases being that you have a sales proposition so dramatically compelling and irrefutable, that it is immediately recognized by your prospects as leaving all other options in the distance, and is almost immediately able to be monetized for the compensation of the seller.
The critical mass of hours is not your biggest concern. Find a way to capture the purchasing power of your market, and focus on your ability to deliver on results.
I appreciate everyone's feedback. Some great advice from everyone.
