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  • Writer's pictureAlec Drake

BSM Seller to Seller Podcast/Interview 7/11/2022

Updated: Jan 19

Jeff Caves in conjunction with The BSM Podcast Network just launched a new podcast series.

I was honored to be Jeff's first guest and be interviewed to kick off the series "Seller to Seller".

Anyone managing sales conversations about rate increases and long-term agreements should find this helpful. Thanks again, Jeff, for the invitation.


"Seller to Seller" with Jeff Caves

Written Summation of Podcast

Jeff's Introduction: Alec served in sales management and consulting roles for radio companies large and small for forty years. For eight years, he also traveled worldwide, consulting Radio and TV stations on yield management and revenue management.

In 2021, after 15 years in Dallas as Director of sales of 7 Cumulus radio stations, including legendary sports station, The Ticket, he began a new mission.

How Sellers Can Handle Rate Increases

Jeff: I wrote about asking for more money, but let's discuss how to present asking for more per spot- is there such a thing as good timing to giving a rate increase?

Alec: Jeff, first, thanks for having me on your podcast. You know from your own experience that rates are constantly changing, and most sales managers should publish new rate cards weekly for their teams. When a contract ends and you need to use higher rates as a salesperson, it's best to ensure your rates are current and the manager will approve the next order.

Regarding timing, the best strategy is to have a conversation about future rates when you close the first order. Usually, a new client may not be comfortable with a long-term commitment, which is ok. Your responsibility in sales is to prepare them for rate changes when shorter-length orders open up a rate change for part or all of the following orders. If you discuss the potential for rate changes early on, you might find an opportunity to start with a longer commitment based on the incentive to keep rates constant as they advertise.

Jeff Q: Is using the "we are in demand" line a good one?

Alec: Demand is a reality and affects rates and inventory access. I would not shy away from the topic, although it is best to put demand in context for the client. I find that if you take a subject and share an example that fits the client's business, you get a much better agreement on your point. For instance, in talking about demand in front of the shoe store manager or owner, bring up demand relating to their inventory. They have boxes and boxes of shoes sitting in the back storage area. They have shoes on display in the store and shoes to catch attention in their storefront window. If a particular shoe does not sell today, they can sell it tomorrow. Radio inventory is perishable and limited. So imagine if all your inventory was only in the store window. Would your shoe business operate differently? Would you be able to accommodate every customer who walked in needing a specific shoe size? As you can see, shifting to their business and talking less about the characteristics of your radio station communicates the topic of demand in a very different manner. Bottom line: Do not make the demand a single reason to adjust rates for your customer and when talking about demand, make it relatable.

Jeff Q: Should we offer bonus spots in off-demand dayparts with a daypart rate increase?

Alec: The easy answer is NO. The best strategy to offset rate increases in high-demand dayparts is to blend in other dayparts to improve reach (that is more value). In the least demanded dayparts, use the lower rates available, which will bring down your order average rate. You can also reduce one spot or two in the high-demand daypart where rates are rising if you need to maintain a budget and protect schedule delivery. Every inventory unit has value and should have a price attached to it that represents that value.

Jeff Q: When presenting annuals, do you think rates should fluctuate during the year?

Alec: Since demand fluctuates, rates will move up and down over the year. The advantage of the annual is that you can have one rate level for the year and a consistent investment for your customer each month. When working with longer-term agreements, the terms and conditions of the sale should be considered carefully. In my experience, I have had clients who want one rate all year, some by quarter, so that they can take advantage of more frequency in lower demand periods and some with multi-year agreements. It's essential to understand what the customer needs, how they manage their ad budgets and what flexibility is required due to unforeseen circumstances. When considering terms on longer contracts, we have cancellation clauses, minimum investment requirements, copy and creative changes, and rates as options to discuss. Do not be afraid to be creative (with manager approval) as this adds elements to the negotiation and does not have a rate stand alone as the main point of an agreement.

Jeff Q: As a seller, we want to earn more money. If a client buys 25 spots @ $100 for $2500 and we raise the rate to $125, and the buyer takes 20 spots for the same $2500, how can we get them to buy 25 spots at $125 or spend $3,125?

Alec: Raising investment based on rate increases is the wrong approach. If you want to earn more money as a seller and your commissions are based on order size (as most plans are), then think more about how you can increase spending with you. The optimal way to get more dollars is to add more value and increase results and ROI in the process. Remember, free spots are not a choice here. What other assets is the client not taking advantage of that you can present? Are they buying digital? Are they sponsoring content or station activations and events? Is it time for them to step up to an endorsement? All of these can help increases budgets and boost your earnings.

Jeff Q: The worst way to handle rate increases? Alec: As we addressed earlier; if all you are talking about is rate, you are putting yourself at risk. All you will do is make your success and relationship revolve around price, making you a haggler at the local flea market.

Q: The best way to handle rate increases?

Alec: The best way to handle rate increases is to avoid surprises for the customer. Deal with the realities of demand driving rate and help them navigate the demand cycles. Work with terms and conditions to smooth out the rate bumps, including contract length.

Thank you for reading this article, and please pass it along to your colleagues.
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About The Author:

Alec Drake openly shares revenue management strategies and sales improvement ideas in the "Sales Success Library" at He is a regular contributor to Radio Ink Magazine, where he leverages four decades of experience to write about sales and management. Alec is the founder of The Radio Invigoration Project (T.R.I.P.), a support initiative for local radio sales and promotion staff.

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

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