• Alec Drake

The 2022 Checklist for Revenue & Yield Management

Updated: Aug 20

Kaizen, or “constant improvement,” focuses on incremental improvements to be better tomorrow than yesterday.

We have been posting insights regarding revenue practices for Radio and TV the last few months, including yield and revenue management concepts. Earlier this year, Arielle Gibson with Upstay wrote a good blog post on the fundamentals of Yield Management for the hotel industry. In her blog, she also points out differences relating to yield and revenue management. There are many factors to consider in the hotel business, including total rooms, occupancy rates, group bookings, FIT rates, Food/Beverage, and local events for demand swings. How do we look at these two disciplines in media?

Yield and Revenue Management in Media

Yield management defines ad prices for inventory utilization from a fixed supply to deliver better yield. Data drives yield management and depends on information from traffic departments, sales reporting to capture pending business and historical references from the business office. In addition, seasonality, ratings, and formats play a role in demand parameters.

Revenue management looks at a broader set of contributors to help you gain the most revenue from your products and services. Yield management’s data-driven backbone supports revenue management, as it looks for demand trends, customer category changes, and promotional impact from product extensions like NTR, digital, and podcasting. Sales marketing strategies play an important role in revenue management as they drive demand for services and communicate value narratives to the market.

Image by Gerd Altmann - Pixabay

Harmony in Your Revenue Strategy

For 2022 to be your best year since 2019 and get you back on a revenue growth track, you will need yield and revenue management to work together.

Tracy Dong, Senior Advisor of the Asia Pacific region at IDeaS Revenue Solutions, works with the hospitality industry. Tracy states, “Today, revenue management professionals need to build commercial strategies that cover their business goals and their customers’ goals all while aligning with their marketing plans.” In addition, her article for ehotelier.com promotes interplay with digital marketing as it plays a role in driving demand.

What structures and processes should we implement in media to connect our pricing practices with our sales effort for optimal results? Here is a checklist to improve the odds of success in surpassing top-line budgets next year.


Image by Gerd Altmann from Pixabay

Yield Management: How solid is your information path to pricing?

  • Are your station capacity numbers current based on any programming changes (local vs. syndication, for example)?

  • How much built-in demand exists for 2022 vs. 2021 (annual contracts), and are you accounting for that inventory being committed to clients?

  • Will your current ratings impact transactional business? Do you expect more demand vs. historical numbers in the first half of the year?

  • Do you need to upgrade your pricing process to include pending business and avoid early sellouts or customer disruption with overselling?

  • What tools and systems do you need to support better pricing decisions?

Revenue Management: Sales Strategies and Assets

  • What customer categories will be growing, and what segments will lag past revenue contributions? Look at your top 10 for changes in purchase activity.

  • What events are coming back or new to your market in the next six months? Do you have sales efforts ahead of decision timetables to capture sponsorships? What is your plan B if NTR is canceled or delayed?

  • What is your plan to keep growing digital revenues, and how can you continue to tie that back to traditional assets? Is your bundle strategy working, or does it need an overhaul?

  • How are you educating the market on your 360-degree marketing services? Have you identified a content creator to work with sales on Account Marketing and prospecting strategies?

  • What investment are you making in your sales team to lift them next year? Is your compensation strategy and incentives on target with the company and station goals? Think more about retention and support instead of cost controls in the short term.

Takeaway:

Kaizen, or “constant improvement,” focuses on incremental improvements to be better tomorrow than yesterday. You may have many “To-Do’s” on your list for 2022, and it’s essential to prioritize areas for improvement. Take a close look at your yield and revenue management plan for upgrades that can boost revenues. Pricing practices and sales marketing strategies should work together for optimal results.

Do not miss "The 2022 Sales Lift-Off" coming on January 13th. Loyd Ford from Rainmaker PathwayConsulting Works, and Alec Drake, will host Chuck Wood and Scott Howard to discuss a strong finish to Q1, recruiting for your sales staff, and a closing roundtable with actionable items to help you and your team grow revenues.

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About Alec Drake:

As President of Drake Media Group, a content creation and sales consulting company, Alec is on a mission to share his unique perspective on best practices to enhance sales performance and drive revenue. The company offers a range of consulting expertise, including sales operations, team and individual coaching, yield and revenue management strategies, event sponsorship formats, and sales marketing.

Drake Media Group, LLC retains exclusive rights to the original content in all articles written by Alec Drake, contained in any podcast appearances, or articles published on third-party platforms.

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