Do Digital Only Sales Teams Outperform All Others?

Most local media advertising providers now use a single sales force to sell both their newer digital products and their traditional print advertising products.  But according to a new report from Borrell Associates, that could be a shortsighted strategy.  The company identified what it believes are major differences between companies that employ digital-only sales forces and those that instead employ a single sales (and content) force strategy which can do it all.

First, the Borrell study noted that an increasing number of companies are consolidating “offline” (let’s just call them “traditional” product sales) and online sales reps into a single unified team selling both types of products.  The number of digital-only sales reps — those employed by traditional  media companies (newspapers, radio and TV, but not Yellow Pages) has dropped from 60% in August of 2009 to 46%.

According to the report, online sites that do employ online-only account executives (AE’s) “outperform those without by a factor of 2.5” in terms of gross online revenue per sales rep. The difference is even more dramatic at TV stations – those TV stations that do employ online-only AE’s, do see them showing results which are three times the gross revenue of stations that don’t. Borrell’s bottom line conclusion:  “(its) 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.”  However, note that the research makes no mention of the impact on the traditional products sales of having some digital-only reps.

Borrell also looked at how local advertising media companies organizing their sales reps, and found that the most successful model tends to be “separate digital units with dotted lines”—companies, which employ both traditional and digital-only sellers, but also have a separate digital division responsible for hitting digital revenue goals and reporting to a separate manager.  Borrell reports “…many of these operations saw revenue growth in the 40 to 60 percent range in 2011, while average market growth for local online advertising was 15 percent.  The reason is no mystery:  with a unit that has sole responsibility for just digital sales, goals and lines of responsibility don’t get tangled up in debates about the legacy media sales problems.”

Borrell is charging $995 for the full 27 page report.

Our Takeaway:

I find some parts of the conclusions to be flawed analysis.  First, logic will tell you that if an AE only sales one product (digital in this case), their percentage of sales will be higher then a salesperson who sells many products, with digital being just one of them.  If they are truly providing a solution that meets the advertiser’s needs, sometimes it may not include digital products.  Any responsible, good AE would respond to the buying needs of the client with a recommendation that provides the greatest ROI for the client, independent of the product set.

There have been numerous attempts in the past by Yellow Pages publishers to try a wide range of sales organization and product strategies – digital only, full suite, vertical market segment focused, etc., etc.

What’s your view?  Which works best, and more importantly, why?


3 responses to “Do Digital Only Sales Teams Outperform All Others?

  1. Ken, Hope all is well with you. Your takeaway “If they are truly providing a solution that meets the advertiser’s needs, sometimes it may not include digital products”. – give me one advertiser/industry that you believe should not be part of a digital campaign. I can’t think of a single senario/industry…

    • Mike: sure can — while riding with a rep recently we visited a wrecker/towing service that indicated he didn’t want print YP anymore. When we looked around his garage/office we found he didn’t a computer anywhere. Instead his phone and cell phone rang constantly, all from just print Yellow Pages advertising. This is a guy who couldn’t tell the difference between a website and Britany Spears. For his business, print works fine and is more than he can handle, in that market. That’s meeting the needs of the customer and not shoving somehting down his throat that he doesn’t need….

  2. I think it is hard to serve two masters. Reps tend to push the products they believe they can sell, over others they have doubts about. Their doubts may be about their own abilities to sell the “other product” rather than the poduct itself. It is a matter of belief as well as customer fit. Training can help, but does not totally correct the problem. I think net results are better with dedicated sales teams and a focus on relationships.
    —Richard, 30 yr YP vet.

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