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Lowering
Rates? There IS a Better Way!
by
Kim Peek
(Winter
2001)
This
is a tough time to be in the media sales business. We avoided the
“R-Word” all year because we didn’t want negative thoughts about the
economy to impact our sales success. We desperately wanted to achieve our
annual sales goals, so we painted an encouraging picture for our AEs and
refused to give in to “recession-speak.”
Unfortunately, it appears the economic downturn is real, and the many
cable executives who were not selling or managing during the last recession
do not know how to respond. The result: panic has caused many markets to
resort to a tactic that could damage their long-term business.
I’m
talking about slashing rates to achieve short-term sales goals. If you’re
guilty, I urge you to resist the temptation. Lowering prices is NOT a
marketing strategy; it is a knee-jerk reaction and a short-term fix that
could wind up hurting your future sales. In his book, Success Leaves
Clues, John Stanton says, “There is a natural inclination for
companies to use price as the first line of defense in any serious battle
for customers…when you lower prices you are probably getting yourself into
deeper trouble. Remember anyone can give product away. It takes brains to
sell it.”
So,
if cutting rates is not the answer, what is? According to many experts, we
it’s time to get back to the basics and put our energies into the
activities we should have focused on all along. Murray Raphel, is an
international marketing consultant, speaker and author of 10 books on
marketing. Raphel says the cable industry needs to begin taking a
consultative approach. I told Raphel that most MSOs teach AEs to qualify
prospects, complete a thorough needs analysis and make specific
recommendations based on the client’s needs. He assured me the AEs who use
the consultative sell are in the minority.
Raphel
says retailers want to know the AE is willing to partner with them to make
the advertising work. He suggests conveying the following message,
“I’m here for several reasons. I want to learn about your business. I
want to find out what you want to sell. I want to find out to whom you want
to sell it. I want to find out the avenues that are available to you that
you are not currently using, like co-op advertising, and I’m going to put
together the total plan and bring it back to you.”
Rosemary
Breehl, President, Integrated Marketing Communications, Inc., recommends
selling from the client’s point of view.
People do not buy advertising; they buy the results advertising
brings. She says AEs should never ask a client to buy cable
advertising. Instead, ask them to invest in increased sales, increased store
traffic or increased product consumption. In other words, sell RESULTS!
Both Breehl and Raphel encourage
the use of co-op funds to help stretch advertising budgets. “The
overwhelming majority--70%--of small and medium retailers don’t use any
co-op money,” says Raphel. “They don’t know how to use it. They are
knowledgeable about their business; they’re not knowledgeable about
advertising.”
Repeatedly,
my contacts pointed out that we are the cable advertising experts, and
it’s our job to provide ideas, expertise and creative solutions that help
clients use their limited resources effectively…in good times and bad.
Breehl says, “Executives with the vision and ingenuity to take an
unconventional approach can lead their companies to new heights.”
It’s
important to remember that we are in the idea business, and we can’t do
our jobs without getting to know the customer. Take some time today to get
to know your biggest clients and prospects. Understand the obstacles they
face, and deliver a creative solution. Do that, and you’ll never be forced
to lower your rates…recession or not.
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