PBMA 2008Compensation

Underwriting Sales Reps

Presented by: Kirk Nelson

PRP Client StationsPhoeni

xPhoeni

x

Seattle

Seattle

Nashville

Nashville

Austin

Austin

DenverDenver

Sacramento

Sacramento

St. Paul MinnesotaSt. Paul Minnesota

Cincinnati

Cincinnati

Question’s

1. What concerns or frustrates you most about your current comp plan for corporate support?

2. What’s your GOAL?

Session will Cover

• Define Compensation

• Understanding Dimensions to Selling

• Designing a Plan for Your Market

• Five Different Plans – Pros & Cons

• Achieving Results

Compensation Defined

Dictionary.Com1. The act or state of compensating

2. The state of being compensated

3. Something given or received as an equivalent for services

Understanding Sales Types

• Retail Salesperson– Reactive selling/business comes to you– Focus on product features benefits

• Outside Salesperson– Pro-active selling/you go to the business– Focus on:

• Product features and benefits or • Customer focused-solutions

• Telemarketing– Lead generator or product peddler– script selling – Focus on sale

• Industry-Type– Short or Long term sales– Focus on buyer needs

Broadcast Sales

• Product Peddler – High Plan – Low Participation

• Counselor Representative– Low Plan– High Plan – High Participation– Relationship

Reward What You Need?

• Spot Sales– 9% Existing Business and renewals– 20% New Business first 15 months

• 25% Web Sales • Events

– 10% Renewals– 15% New Business

• Group Market Stations– 15% Lead Sales Rep– 9% Station Rep

• 1% Business 10%+ Quota• 2% Business 20%+ Quota• -1% Deduction less than 95% of Quota

Value of Inventory

$25

$50

$50

$175

$275

$3,200

$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500

Broadcast

Print

Events

Web

Specials

Other Values in thousands

Selling Compensation Continuum

Hard

Easy

Degree of Difficulty

Designing a Plan for Your Market• Understand your markets value

• Market Compensation Considerations– Total Compensation Statement

• Recruitment - Positioning Your Compensation

Understanding Your Market

• Public Broadcasting Profile• Excessive Talent Pool• Growing Market Economy • Culturally Dense• Rich in Public Broadcasting

Categories• Commercial Competition• Public Competition

Compensation Considerations

• Pay – Commission, Salary, Both • Medical Benefits• Education• Non-taxed Retirement Accounts• Time Off• Retirement Benefits• Station Position – 1st or 2nd tier• Work Environment• Selling Tools & Support

Recruiting

The 7 Behaviors• Customer Service• Self Management• Written Communications• Persuasion• Interpersonal Skills• Goal Orientation • Presenting

Recruitment Posting

Do You Love Public Radio (Television)… Corporate Sponsorship Sales - Public Radio

Partners seeks determined and persuasive sales professionals to join our public radio sales team at XXXX. Position requires the development of new business and excellent communication and presentation skills. 3 years sales experience and 4 year college degree required. Media or marketing related sales experience preferred. Please e-mail cover letter and resume to xxxx xxxxxxxx at xxxxxx.com

Promote your Total Compensation Value

Statement to Good Candidates

5 Types of Comp Plans

1. Salary Only2. Salary + Commission3. Salary + Commission + Bonus4. Commission Only5. Commission + Bonus

Plus Sales Manager Comp Model

1. Salary Only - Station

• Station Perspective+ Easy to budget + Easy to manage

cost of sales+ Easy to process

– Difficult to recruit “good” sales people

– Difficult to motivate sales people

– Station must create demand

• Employee Perspective+ Guaranteed Income+ Can budget

accordingly

– Slow income growth– No incentive to grow

revenue

2. Salary + Commission

• Station Perspective+ Greater motivation

to promote budget attainment

+ Better recruiting tool

– Requires establish trends to budget

– More time to process payroll

• Employee Perspective+ Provides safety net for

reps+ Modest opportunity for

income growth

– Significant upside may be difficult

3. Salary + Commission + Bonus• Station Perspective

+ Excellent recruiting tool

+ Promotes budget attainment

+ Promotes employee engagement

– Requires establish trends to budget

– More time to process payroll

• Employee Perspective+ Provides safety net

for reps+ Opportunity for

income growth

4. Commission Only

• Station Perspective+ Budget against

projected billing+ Cost of sales

variable based on performance

+ Good recruiting tool

– Incentive flexibility for budget attainment

– Expect Low performer turnover

• Employee Perspective+ Significant income

potential for high-performers

– Viability of income based on ability to perform

5. Commission + Bonus

• Station Perspective+ Budget against projected

billing + Excellent recruiting tool+ Promotes budget

attainment+ Promotes employee

engagement

– Requires establish trends to budget

– More time to process payroll

– Expect Low performer turnover

• Employee Perspective+ Significant income

potential for high-performers

– Viability of income based on ability to perform

Sales Management Comp

Cost of Sales Considerations

• Cost of sales– Whatever the cost, employee comp stays the

same

• Total Compensation Package– Base – Commissions– Team bonus– Individual bonus– Discretionary Incentive flexibility

Compensation Agreement

• Guaranteed Commissions• Guaranteed Commissions Pay

Structure• Individual Commission Structure• Charge Back Policy• Termination• Background Check & Drug Screening• Acknowledgement

Achieving Results

• Responsibility– answerable for something within one's

power, control, or management

• Accountability– Being accountable, liable or answerable

Responsibility

• Sales Manager– Assigning realistic quotas

• Obtainable objectives• Based on station or industry benchmarks

– Maximizing department revenue potential– Overall department development– Tools to succeed

• Sales Rep– Understanding departments, and individual

goals and objectives

Accountability

• Manager– Attainment of budget objectives

• Monthly, quarterly, annually– Department account collections – AR minimums

• 30, 60, 90 & 120+

• Sales rep– Meet or exceed personal Quota

• Monthly, quarterly, annually– Personal account collections – AR minimums

• 30, 60, 90 & 120+

Rep Growth Rates

• First Year 100K – 150K• Year Two 250K

• + 50 – 100 % prior year

• Year Three + 25 – 50%• Year Four + 20%• Senior Rep +10%

New Rep Growth Expectations

$0 - 1,500 Month 1 $2.5 - 5,000 Month 2 $5 - 10,000 Month 3 $7.5 - 10,000 Month 4 $8 - 12,000 Month 5$8 - 12,000 Month 6$10 - 15,000 Month 7$10 - 15,000 Month 8$10 - 15,000 Month 9$12 - 20,000 Month 10$12 - 20,000 Month 11$12 - 20,000 Month 12

Benchmarking Performance Radio

Benchmarking Performance TV

Salary Only

• Measure activity during Probation Period– Time in, time out– # new business calls

• Daily, weekly

– Total # calls• Daily, weekly

– # presentations• weekly

– # Sales

Revenue Versus Collections

• Revenue is predictable three months • Revenue can be:

– Planned – Predictable– Sustainable

• Collections can be erratic• If rep leaves there’s little motivation

to work account

?? Questions ??

Presented by: Kirk Nelson