www.RAB.com

Sales Management:

Member Responsemember_response@rab.com

800-232-3131

Budgeting To Assure Success In 2012

John PotterVP TrainingRadio Advertising Bureau

Welcome

• PDF of slides will be available• Watch your e-mail• Check junk mail• We appreciate feedback

• Lines are muted• Q & A• Type your message

• Problems?• RAB Member Response

800-323-3131

What We’ll Cover

• Preparation resources

• Getting started: narrative

• A process

• Factors to consider

• Involving your staff

• Templates

What’s your method?

• Throwing Darts

• Fortune Teller

• Tell Them What They Want to Hear and Hope It Happens

What Does Corporate Want?

• How can you give them what they want?• Where can you go for help?

Resources

• Historical information• National revenue• Market revenue• Revenue by month• Revenue by month by advertiser• Revenue by month by salesperson• Revenue % change• Multi-year trends

The Process

• 24/7/365• Preliminary• Final

The Process

Narrative• Local economy• Advertising• Competition• Staffing• Pricing

The Process

• Face the facts• You have to do it• You have to do it right• You have to do it by a deadline

• Schedule the time• Assemble all your tools and

resources

Getting Started

• The first step in projecting the future is examining the past

• 3 year trends

• YTD

• % of total by month

• Pacing numbers to determine current trend

• Project revenues through end of year

Factors To Consider

• Economic environment

• Advertising environment

• Competitive environment / station competitiveness

• Staffing realities

• Pricing realities

Economic Environment

• Market Health• Employment Conditions• Retail sales

Where to look…• RAB.com• Business Journal• Chamber of Commerce• Online Searches

Advertising Environment

• Audit firms

• Voicetrack

• Rep reports

• RAB Revenue Reports

• RAB Ad-to Sales Report

• Station audience

Traffic Reports

• Pull Top 20, 100, 200

• Are their revenues increasing or decreasing? Why?

• 80-20 customers

• Strategy for retaining/growing existing business

• Strategy for growing new business

What Are Your Objectives

• Sell more clients?

• Sell current clients more often?

• Sell at higher rates?

Competitive Environment

“You can only take care of your own station(s).”

Station Competitiveness

• Ratings

• Projected ratings

• Power ratio

• Market revenue

Competition

• Who is your primary competition?

• Who is getting what shares?

• Competing media strengths and weaknesses

• Are there any new competitors? Who?

Staffing Realities

• Current skill set and any plans for improvement

• Projected changes in the staff and your plan to respond

• New hires or planned new hires

• Projected staff size

• Experience vs. Expertise

• Your recruitment plan

Pricing Realities

Manage to your goals…

Crunching the Numbers

• Corporate or self-defined• % increase or hard number• Criteria• Top line (sales) or bottom line (BCF)• Cluster or individual station(s)• National• Local• New business• NTR• Inventory pricing strategy

Budget Template

• 13 columns• Back up your work• Learn Excel• Create line-items

• Local• Regional• National

– On air– Alternative Revenue– Event– Digital

Salesperson’s Budget

• Account• Category• Last year’s actual by month• Projected billing by month• Dollar change• % change

Salesperson’s Budget Prep

Increase Annuals

Expense Budgeting

• Zero based

• Justification

• “Outside the box”

• Budget for RAB and other training

Other Considerations

• Market value of 1 share point

• Projected rating or programming changes for your station(s)

• Projected rating or programming changes for competing stations

• Planned promotional and/or marketing initiatives

Staff Involvement

For a budget to have a chance of succeeding, your staff has to buy in and take ownership of the numbers

Without their commitment, effort, and perseverance, you cannot achieve the goals

Involving them in the budgeting process sends the message that it is their budget, too

Your Numbers

Your Staff Numbers

Combined Input

Staff Involvement

Your Numbers

Your Staff Numbers

Combined Input

Individual goals should be challenging

Individual goals should be obtainable, with effort

Compensate achievement

Reward over-achievement

Staff Involvement

Sales people should be responsible for submitting their individual revenue projections to you at the beginning of the budgeting process.

They should include all revenue subsets you are required to submit.

For example, monthly, quarterly, and annual totals, NTR, new business, agency/direct, etc.

Your Numbers

Your Staff Numbers

Combined Input

Three Approaches to Projections by Sales People

1. Sandbagging

2. Pie-in-the-Sky

3. Aim for the Center

In your one-on-one budget meeting with sales people, you have to know which approach they are taking and factor it into your “negotiations” with them. Insist on knowing their rationale and challenge them to explain their fallback plan.

Expenses

ROIIf the money is spent, how much return do you estimate from the investment

Bonuses for exceeding goal

Questions & Answers

John PotterVP/Training

jpotter@rab.com800-232-3131

Thank you for joining us!

Tiffiney Wyatt, MBADirector/Member Responsemember_response@rab.com 800-232-3131

Sales Management:

Budgeting To Assure Success In 2012