Episode 42: Doug Weaver, Upstream Group on Digital Media Sales Talent, Faustian Bargains and the Advertising Revenue Shortfall

Listen Now
RSS: Subscribe
RSS: iTunes

This episode is for anyone dependent on direct sales teams for revenue in the digital media and technology sales industry. According to Doug, the market has radically shifted -- TWICE. Have YOU adjusted your business culture, operations, staffing and revenue expectations to the way the market is NOW? 

Do you understand the difference between ad networks and ad exchanges? If you don't. Now you must.

Do you know why the online media market numbers took a big dump in Q407 and Q108? Do you know why they are predicted to be low in the first half of '08 and are you prepared? Do you know how to prevent your company's revenue from bottoming out?

Find out what Doug calls "the network effect." In this case it's not good. But you can counteract it by training your team to be "Digital Sellers 3.0."  Doug tells you how in this helpful show. Is your sales team set up to fail? How can you affect a turn around to a consultative sales/ How do you change your staff from "RFP Order Takers" to early-cycle strategic big-deal sellers? How do you differentiate yourself through your sales people and staunch the tide of commoditization of online media?

Doug gives you a clear path to success, rather than expecting you to make a Faustian bargain for change. This is one of the most actionable, helpful shows ever done on DishyMix to truly affect your business, your revenue and your future. Tune in. Learn. Change. Go!

Transcript

Susan Bratton: Welcome to Dishy Mix. I’m your host, Susan Bratton. Thanks for tuning in today. We’ve been having a number of shows that have themes like creativity and the new world marketing, and today we’re going to talk about sales. We’re going to talk about the network effect, the advertising fallout of last year and this year and the new digital seller, what our guest today, Doug Weaver, called digital seller 3.0. On today’s show you’re going to get to meet Doug Weaver. Doug is the CEO and founder of Upstream Group. His focus has been on the sales process in the online advertising industry. He’s been doing it for years. He knows sellers and the sales process probably better than anyone in this industry, and our whole show today is focused on what we need to do to resource our business the right way to get the right kind of sellers into our sales force, how to structure it and how to be successful in the changing landscape of the online media world. On today’s show we’ll talk about ad inventory and the network effect. We’ll talk about cooties, structuring sales teams and how to be a smart publisher.

Doug Weaver: The network effect has been, a lot of money has been taken off the table before it’s even getting into the RFP process. So a lot of publishers, a lot of media companies really had the rug pulled out from under them, sort of a “Dude, where’s my money?”

Doug Weaver: I think what’s going to happen is that the pendulum swings back to the middle and, yeah, the publisher begins to look at this and say, “Okay, they’re on a landscape. How do I make use of them if I do or how do I create capabilities that are going to allow me to, you know, to compete for those larger, for those larger based buys, and frankly also make choices about what buys I’m not going to go after.

Doug Weaver: What I found interesting about exchanges, and part of the education that I’ve gotten here, is that they can also be useful to publishers. In other words, a publisher doesn’t just have to go there to put inventory in, they can go there to take inventory out.

Doug Weaver: To make it very simple, I think the current sales landscape is far too transactional. We have an entire generation of digital sellers who are competing on the basis of price and availability.

Susan Bratton: Welcome Doug.

Doug Weaver: Thank you Susan.

Susan Bratton: It’s great to have you back. Now the last time we did a show with you and Scot McLernon when you announced Habitat, which is part of Upstream Group. Without too much time, ‘cause we want to really focus on how to get a good sales team in place and working in today’s world, just tell us a tiny bit about Upstream Group and Habitat and what those are.

Doug Weaver: Sure, sure. Upstream Group is a company that serves the needs of heads of  digital sales, the people who are in charge of really running the revenue side of this business, and one of the things that we’ve done consistently over the last ten years is we’ve trained their sales team sort of one team at a time. Going forward, Scot and I, Scott’s joined the business and we have just recently launched a program called Upstream Habitat, which is a big departure for us. It’s a two-day digital university for sellers, and we’re going to have a faculty of eight and curriculum over the course of two days, nine different courses from which sellers can choose. And, you know, without too much iperbally, I think it’s just about the most ambitious that’s ever been done in our space to bridge this talent gap that exists out there, and we’re very excited about it.

Susan Bratton: If someone wants to look at the curriculum itself, what’s the URL?

Doug Weaver: It’s upstreamhabitat.com.

Susan Bratton: Great, thank you. So one of the things that you’ve realized in getting large groups of sellers together in forums and private sessions to have closed door discussions is something that you’ve come up with called the Network effect. First of all, tell us about what this network effect is. There’s something happening in our industry. Our industry has changed and it blindsided us…

Doug Weaver: Yeah.

Susan Bratton: Tell us the story.

Doug Weaver: Yeah, it’s interesting. Over the last, I would say, six months, I’ve heard, I had a very similar conversation with a number of different customers, and it goes something like this: “What happened to my inventory? What happened to my dollars?” We’ve run into a soft spot that we didn’t expect. You know, we see online dollars going up, but we’re not getting the orders that we thought we’d get at this point in time, my numbers are softer than I would’ve projected they were. And at first I thought we had a few outliers and then I started to see a little bit of a trend, and I realized what was happening was this network effect, and it goes something like this: a lot of these heads of sales, a lot of these digital sales leaders have, you know, consistently given revenue inventory to ad networks over the years, and it’s, you know, it’s been kind of an offhand decision.

Susan Bratton: It’s a way to bolster the bottom line for many, many publishers.

Doug Weaver: Exactly…

Susan Bratton: Mm hmm.

Doug Weaver: and a lot of them look at that inventory as perishable, so if I don’t sell it, I may as well get pennies on the dollar for it and at least see some revenue from it. What’s happened is that those ad networks who seemed like, you know, a remnant outsource solution, have been taking that inventory and doing a very smart job of wrapping it up and presenting the marketplace as something that it really needs, and that’s reach, and effective reach at that in some cases. So the network effect has been that, a lot of money has been taken off the table before it’s even getting into the RFP process. So a lot of publishers, a lot of media companies really had the rug pulled out from under them, sort of a, “Dude, where’s my money?” or “Dude, who stole my money?”, kind of moment.

Susan Bratton: And so the network effect is really a bad thing. It’s the fact that the networks have gone out and taken a huge chunk out of the market because silently they’ve been building all these capabilities and targeting and retargeting and optimization and localization, and so they become as powerful because they have access to all this premium inventory, they become as powerful and have more reach than a typical individual publisher who might control one sight or a series of sights, right?

Doug Weaver: Yeah, I think, I think there’s a lot to be said for that. I’m going to avoid any sort of moralizing about, you know, good/bad. I think the important thing for publishers is to realize that networks didn’t just happen, you know, they’re on the landscape and they appeared for a reason, and the issue is that the online has always been too difficult to buy. And what I mean by that is if you’re the head of a major buying organization or a major client, you don’t want to deal with, you know, 200 websites.

Susan Bratton: Right.

Doug Weaver: You know, you want to 2 or 3 orders and buy a huge audience all at one time. The networks have stepped in and they’re filling that gap, at least temporarily. The, you know, so I think that from what I see, through the seller forum event that we do and through a lot of the relationships that I have with publishers is that, you know, initially there would be, attitude toward the ad network was sort of benign neglect.

Susan Bratton: Mm hmm.

Doug Weaver: They’re there, you know, we use them because we have to, so what. Then I think about 6, 8 months ago it turned to, you know, real concern and almost a sense of resentment and really pushing back on that, and that still exists. I think what’s going to happen is that the pendulum swings back to the middle and, yeah, the publisher begins to look at this and say, “Okay, they’re on the landscape. How do I make use of them if I do or how do I create capabilities that are going to allow me to, you know, to compete for those larger, for those larger based buys, and frankly also make choices about what buys I’m not going to go after.”

Susan Bratton: So one of the things that you told me is there are some rules of engagement that a publisher and a VP of sales or an SVP of sales should be focused on when they’re dealing with their ad network relationships. You had some concern about making sure that you focus on the head of sales and not the business development person. Tell us about the potholes in the road from the sales perspective, if you are with a mainstream high end publisher and you’re selling inventory to ad networks, what are the rules of engagement or what should they be?

Doug Weaver: Sure. Well I think the first rule of engagement is do you do it at all. You know, one of the, we had some esteemed panelists with us at our last event and one of them just said, well look, if you have a very, very high CPM, you know, if you’re a Wall Street Journal or you’re, you know, somebody whose got a high, whose got a CPM, you know, well into the, well into the double digits consistently, you’ve got no business doing, you’ve got no business doing business with networks at all, because the downside CPM risk is too high. You don’t want to create a second channel for that. You’re better, you’re better off, you know, sort of plowing that inventory under and using it for, using it for half ads, using it for internal navigation, what have you.

Susan Bratton: So if you’re consistently selling a $10 dollar CPM or above, don’t even mess with ad networks.

Doug Weaver: Yeah, I think 10 is probably, you know, 10 is probably on the low side there…

Susan Bratton: Right.

Doug Weaver: I think probably, you know, if you can consistently command, you know, 30, 40 dollars…

Susan Bratton: Yeah.

Doug Weaver: If you’re on, if you’re in that stratosphere, then you probably want to stay away.

Susan Bratton: Just hold your ground. Yup.

Doug Weaver: You know, but I think most publishers are not in that position and they’re competing for, you know, more modest CPM’s, so if in fact you’re going to, you’re going to try to maximize your revenue and use networks, a few different things you want to keep in mind. First, the networks are supposed to sell the inventory blind and that is, that’s something that you really need to enforce because quite honestly a lot of them don’t.

Susan Bratton: Right.

Doug Weaver: A lot of networks will do a wink and a nod with the advertiser and say, “Hey, we don’t know where this is going to run, but gosh, 80 percent of our inventory comes from site x”, so you’re probably going to get a lot of that. So that can really soften your rate card tremendously.

Susan Bratton: Mm hmm.

Doug Weaver: To try and enforce that, I think it’s really critical that, you know, you as head of sales to the site, deal with the head of sales for the network, right, that there be a direct link there. If you’re talking to a business development person whose job is just to acquire, then you’re not dealing with the person who’s going to be enforcing those rules on the sales team on their side, so having that sales head to sales head relationship is critical in making that happen.

Susan Bratton: And what about Cooties, you talk about Cooties.

Doug Weaver: Yeah, one thing that I’ve learned from a lot of my customers is that there are, there are tags and there are beacons and spotlights that are very often attached to inventory for the purpose of retargeting…

Susan Bratton: Mm hmm.

Doug Weaver: so, you know, get the inventory from this publisher one time and then be able to identify those consumers who you encountered through, you know, through that buy or through that relationship and be able to target them on your own later on and that’s, you know, that’s something that’s got to be, you know, carefully looked at. And as I understand it, and I’m not an expert at all in that end of things, but it’s been explained to me by a couple of smart op’s people that that’s exactly what you need is that the smart op’s people to look at that and make sure that that’s not happening.

Susan Bratton: Of course, because retargeting, they get in their wants and then they own that cookie of that user and they can find them all over the web ‘cause they have such massive reach.

Doug Weaver: Yeah. Yup.

Susan Bratton: So I want to move on to ad networks. There’s something that I really haven’t understood because I’m not a media buyer…

Doug Weaver: Mm hmm.

Susan Bratton: I don’t understand the difference between an ad network and an ad exchange, and I think you have a position, a point of view on what those, what the use of those two are from a publishers perspective. Will you tell me that?

Doug Weaver: Yeah, and I’ll be candid in saying I’ve gotten quite an education on this myself lately, I think a lot of people just sort of see the alternate revenue channel as one big mish mash with a lot of new brand names and frankly a lot of confusion.

Susan Bratton: Mm hmm.

Doug Weaver: So I’m going into this as kind of a neofite and kind of learning it along the way and then kind of sharing the knowledge with my customers. And if you think about it this way, the key distinction between these two is, you know, an ad exchange is really just a place to park your unsold inventory. So a true ad exchange is not there to have a sales position, right. They don’t really have a sales position within the deal. They’re simply there as literally like a stock exchange, a place where buyers and sellers come to strike an individual deal for a given amount of inventory. How do they make money? They just get a little vague, they get a little cut of that transaction. They don’t establish the price, they don’t establish the rules, those are done by the parties involved. And what I found interesting about exchanges, part of the education I’ve gotten here is that they can also be useful to publishers…

Susan Bratton: Mm hmm.

Doug Weaver: In other words, the publisher doesn’t just have to go there to put inventory in, they can go there to take inventory out.

Susan Bratton: Right.

Doug Weaver: So in other words, if I’m, if I’m a modest sized publisher whose got a smart program going for an advertiser, but it just doesn’t have enough reach, it’s just not reaching enough people, well I can go to an exchange and I can buy additional reach and then extend that campaign out almost creating a virtual network for that campaign or for that program. And I think that’s a pretty, pretty interesting concept, you know, the idea that the publisher can actually use this tool to, you know, to extend their footprint.

Susan Bratton: I think that’s a great point, and it sounds to me like as a publisher we need to really understand our ad network relationships and start to really understand media exchanges. We’re going to take a break and when we come back I want to focus on the seller. I want to focus on what’s wrong in the industry with the way we’re asking our sellers to sell and what we need to be doing and how we need to structure our organization, the kind of talent we need to acquire and the skill set that they need to have. I think that’s the most important and critical part of this conversation. So lets do that when we come back. We’re going to thank our sponsors. And I also just want to mention to our listeners that I’ve started a Face Book page for Dishy Mix. If you would like to know each week who goes live on the shows, if they’re valuable to you and you’d like to be part of the Dishy Mix fan club, I’d love for you to join it. Just go to Face Book, search for Dishy Mix, you’ll find me and you can join. What I use that Face Book fan club for is to give away things. I’ve recently given away a whole bunch of autograph copies of Ren Gen, a whole bunch of autographed copies of Meatball Sunday. I’m getting a lot of goodies for my listeners and I’d like you to be the first to know about those opportunities. So I hope you’ll fan me in Face Book. You can also always send an email to me, susan@personallifemedia.com, with any comments or questions that you have. So we’re going to go to a break and we’re with Doug Weaver. He’s the president and CEO of Upstream Group, and when we come back, actually Doug, I think your title is CEO and founder of Upstream Group, and when we come back….

Doug Weaver: Yeah, I’m getting used to that myself.

Susan Bratton: We will, we’ll talk to Doug about sales, selling and the digital seller 3.0. Stay tuned and we’ll be right back.

Susan Bratton: We’re back and we are with Doug Weaver, probably one of the people in the industry who knows more about what it takes to run a good sales team and has the inside ear of all of the publishers and the VP’s of sales in the industry. And Doug, you think that there’s a problem in the marketplace and you have some suggestions for fixing it. Describe the current landscape, the sales landscape, in the digital industry.

Doug Weaver: Sure. To make it very simple, I think the current sales landscape is far too transactional. We have an entire generation of digital sellers who are competing on the basis of price and availability. They’re not really operating out of boiler rooms but, you know, many of them, it’s not far from that. You have, you have a lot of people who really feel like their job begins when they receive the RFP. They compete really on the lowest common denominator metrics. You know, it’s how, you know, it’s how many impressions, what do they cost and it’s all being done in very, very short cycles within planning process to again make a sweeping generalization because certainly there are outliers in both directions. There’s really not enough distinction between what that publishers sales team is bringing and what the network sales team is bringing. So there’s this sense of parody in the marketplace.

Susan Bratton: So it’s a commoditized market with a bunch of order takers and there’s no difference between the selling teams and the publishers and the networks.

Doug Weaver: You know our mutual friend Wenda Harris Millard…

Susan Bratton: Yup, she was on a Dishy Mix recently, I hope you listened to it.

Doug Weaver: I certainly did. And, you know, one of the, one of the points that she made recently was we can’t allow our inventory to be sold by pork bellies.

Susan Bratton: Mm hmm.

Doug Weaver: You know, this can’t just be about, you know, a big brokerage or a big commodity market. Well unfortunately, the average online sales team I think is doing far too much of that, and we’re now sort of in the second generation of digital sellers who kind of think that that’s the job. So one of the things that, you know, that we do through our practice and through Habitat and also through our private workshops that we do with teams is to try and reconnect those sales people to a, in some cases connect them for the first time, to the higher level marketing oriented sell.

Susan Bratton: So you call this new. You, what you’ve said is there’s two generations essentially of order takers that know how to tap agencies, so by the time it gets there it’s all just a, just a slug fest. You’re saying we need to move to Digital Seller 3.0, which is a more consultative sell, selling directly into the client working through the agency. Describe the Digital Seller 3.0 from your perspective and give us some ideas about that.

Doug Weaver: Sure, sure. Well, the first thing I’ll say is, you know, I like, I think in terms there’s really been three distinct generations, we’re just beginning a third now. The first generation of digital sellers, I mean way back in the, in the olden days when you and I were selling space, now you, I’m trying to think back a little bit, I’m remembering At Home.

Susan Bratton: Yeah, I ran the sales teams at At Home and…

Doug Weaver: Right.

Susan Bratton: and then Excite At Home.

Doug Weaver: And I was at Wired and Firefly…

Susan Bratton: Yup.

Doug Weaver: way back then…

Susan Bratton: Yup.

Doug Weaver: Back in those, back in those days, and I’d say this is kind of takes us through maybe…

Susan Bratton: Right through the dot bomb, I sold right…

Doug Weaver: 2000, yeah…

Susan Bratton: right through the dot bomb. I staffed up and laid off the whole thing, cradle to the grave.

Doug Weaver: But, you know, but during those times I think the digital sellers were really aligned with their sites or with the portals they sold for, and those people sold audiences and environments.

Susan Bratton: Yes.

Doug Weaver: You know, and that’s not making a moral judgment on them and saying that’s, you know, the way, it was good for its time, it’s what was needed for its time. And, you know, the essential pitch was, you know, run your ads here, they’ll work better, they’ll look better, they’ll (unintelligible) people. So it was aligned with, it was aligned with the site itself. Generation two, and I think the people that have really been the mainstream of the digital sales business over the last, you know, six or seven years, they’re really aligned with the buying process itself.

Susan Bratton: Mm hmm.

Doug Weaver: They’re trained, they’re groomed, they’re socialized to become experts in the mechanics of this digital buy.

Susan Bratton: Yeah.

Doug Weaver: So it’s, you know, hey, we go an insert, you know, we got an RFP, everybody scramble, lets make something happen, lets turn this around in 12 hours. So if you think about it, these sales forces are really built and run to slug it out, do what it takes to get on a give and buy. They lose sight of what the real form and features are that make the site special, so they really can’t help the site compete on the basis of what it does very well or what it does better than anyone else, so those unique capabilities kind of fall away, and it really, and they’re really trained to slug it out within essentially a commodity marketplace. Now there’s two problems here for the, you know, for the site. Problem one is that that seller is very portable and probably somewhat mercenary. They can take that skill set and they can go apply it for any other site or for a network, so you’re not really building, you know, a unique asset in that seller. And problem two is that they’re not very good at differentiating a product and that is feeding the exact perception of parody that is driving the adoption of a lot of network buying by a lot of agencies and clients.

Susan Bratton: So what do we need to do to teach our sales people? What I understand you telling me is that we need to really imbue them with a sense of what marketers goals and strategies are…

Doug Weaver: Mm hmm.

Susan Bratton: so that they can, that they can support that with the media, not just go sell an audience at a price. How do you make that happen?

Doug Weaver: I think there’s, I think there’s really, you know, two or three different places where you need to take action. First and foremost, we’ve got a talent issue in our space. One of the, one of the other topics that we discussed at the recent Upstream seller forum was the fact that we have, you know, we have publishers who are literally bidding up the price of, you know, any kind of digital sales talent that exists.

Susan Bratton: Yeah.

Doug Weaver: So you have, you know, if somebody can fog a mirror and they, you know, they can say ‘internet’, you know, we’re paying a lot of money to get that person…

Susan Bratton: Highly overpaid order takers.

Doug Weaver: I think, I think that’s the case…

Susan Bratton: Mm hmm.

Doug Weaver: I think that’s the case far too often. So, you know, question one is who do we need to bring into the industry? Who are the, where are the new sources of talent, and we had a panel at our even which was tremendous, where we had a couple of HR people and a couple of top recruiters, and of course our group had several opinions as well and some interesting ideas, you know, reaching outside the industry, reaching outside of the quote/unquote “digital sales talent”, who do you hire, who do you bring in? And some interesting answers. One suggestion that was made that I think is a good one is what about that young consultant at a Bain or a McKinsey, somebody’s who’s, you know, can we compete for that person? They have some unique skills in terms of the real consultative approach, the real, you know, staying with the problem longer, crafting a bigger, more complex solution. That, those skills can migrate into this new kind of online selling.

Susan Bratton: How do they learn those things? Who taught them that?

Doug Weaver: Well I think that, I think that in general the approach that consulting organizations take where, you know, we are going to spend just that much more time studying the problem, we’re not going to rush to the solution, I think that’s something that’s almost inherent if it’s in the blood of the consultant. Now there’s a lot of bad things you can say about consultants and consulting organizations as well, but we will grant them, we’ll grant them the fact that, you know, they do a great job of analysis and really up front, you know, aligning with the bigger business issues that their clients are facing.

Susan Bratton: Right. So it’s a cultural approach to understanding and solving to the bigger business issues rather than the 30 mentality of booking whatever’s on the street.

Doug Weaver: I think that’s, I think that’s true, yeah. I would call that very accurate.

Susan Bratton: But then how do you, lets parking lot my next question, ‘cause I want to hear some of your other ideas for specific sources for reaching outside our industry, but I want to parking lot this thing which says if you’re a publisher and you’ve been operating on a 30 day mentality and then you say to your company, “Hey, we’re going to change our approach to this consultative approach”, I want to hear how you solve to that, because there’s a gap that has to be closed in the revenue that comes in by taking people off the street to snatch up the orders and teaching them how to sell…

Doug Weaver: Mm hmm.

Susan Bratton: Or firing the people…

Doug Weaver: Yeah.

Susan Bratton: and getting in the consultative people who you’ve got to get up to speed, so there’s a…

Doug Weaver: Yup.

Susan Bratton: there’s a real business problem there, which I think you have some answers for. Parking lot that and lets go back to specific sources reaching outside the industry, ‘cause that’s a good vein we’re tapping.

Doug Weaver: Yeah, I think, you know, one of the, one of the, first of all I do have a couple of very specific suggestions and I do completely accept the fact that you can’t do the Falstein bargain where, “Hey boss, we’re not going to have any revenue for six months while we retool”, that’s not an option.

Susan Bratton: Yeah.

Doug Weaver: So, more on that in a moment. The other areas that were, were brought up in our meeting which I thought were pretty interesting was, you know, account people and executive level people from traditional agencies…

Susan Bratton: Yeah, that’s brilliant.

Doug Weaver: Those who are, you know, those who know just enough about the internet to, you know, be a little bit dangerous but really, you know, where those people live there’s, they’re the ones who discuss what I call ‘the big brief’ with the client…

Susan Bratton: Yeah.

Doug Weaver: You know, they’re the ones who really talk about a long-term relationship with the agency, who talk about, you know, who talk about total marketing strategy. Those are the kind of, that’s the kind of skill set we need to bring in.

Susan Bratton: It’s so simple, but it’s brilliant. I never thought of it, but it’s so obvious.

Doug Weaver: Yeah, I think, I think, I think many of us, you know, immediately look to the digital teams at digital agencies…

Susan Bratton: Yeah.

Doug Weaver: We look at that, that associate media director or the account supervisor within the digital shop and we say that’s a natural source of talent.

Susan Bratton: But they’re on, they’re just on the other side of the burn ‘em and churn ‘em.

Doug Weaver: In some cases they are…

Susan Bratton: Yeah.

Doug Weaver: I think there’s a lot of, a lot of very talented people in digital agencies, a lot fewer every month because they’re, you know, they’re part of the, you know, the brain drain, the ones who are being hired up and snatched up by a lot of digital companies. But I think that, you know, reaching into those traditional shops, ‘cause those people have to be looking at their future and saying, “Mm, is there, you know, is there a faster track for me? Is there an opportunity for me to do more interesting, more compelling work and potentially see, you know, a bigger upside.” The other, the other area’s that came up which I thought were interesting was enterprise software sellers, somebody who’s used to sort of going to, you know, going to a major, you know, going to a C-level customer, a CIO, a CEO and proposing a, you know, in many cases the multimillion dollar solution, you know, hardware software.

Susan Bratton: Well these are also the people that know how to work multiple levels of an organization, both vertically and horizontally in an organization and retain the connections and create the relationships and sell the solutions at the right level, so…

Doug Weaver: I couldn’t have said it better.

Susan Bratton: Yeah, that’s a good, enterprise software sellers, yup.

Doug Weaver: And the last area, and I think a lot of people have dipped into this, this particular barrel, are traditional media sellers.

Susan Bratton: Mm hmm.

Doug Weaver: And I’m going to tell you that there’s about a 50 percent success rate…

Susan Bratton: Okay.

Doug Weaver: in doing that. You know, about half, you know, half of them end up performing very, very well, and half of them run screaming from the building.

Susan Bratton: Yeah.

Doug Weaver: And the issue, the issue with complexity, and I think the single most important question that you can get your arms around as a, as someone who’s looking at that talent and evaluating that talent is, can this person live in an unstructured environment?

Susan Bratton: Yeah, it’s a level of brain power, a level of being able to juggle complexity.

Doug Weaver: And chaos. Not just complexity, chaos.

Susan Bratton: A traditional media seller who sells multiple properties is often someone better than someone who’s only sold a single publications…

Doug Weaver: Mm hmm.

Susan Bratton: or a single channel or a single, you know, a single show or whatever they’ve sold.

Doug Weaver: Or, and/or someone who has ancillary products associated with their brand.

Susan Bratton: Yeah, yeah.

Doug Weaver: So I, for instance I have a client who, you know, does medical, you know, health related magazines…

Susan Bratton: Mm hmm.

Doug Weaver: They also have email, they also have doctor’s office programs…

Susan Bratton: Mm hmm.

Doug Weaver: they also have a number of other things to sell, so that person who can take that kind of multifaceted, you know, non traditional multi channel sell and plug a customer into lots of different veins of opportunity, that’s a great skill set to have.

Susan Bratton: Yeah, strategic bundling, as well as a passion for learning new things of course.

Doug Weaver: And you know me, I’m a trainer so I like to think I can teach everything. You can’t teach that. You got to look for that on the way in ‘cause they’re not, you’re not going to give them that.

Susan Bratton: So lets go back to the Falstein Bargain. We have maybe five minutes left of the show. I’m always conscious of my listeners time and we’re insisting really good things. I want you to tell me, I’m a publisher, I’m in the short-term business of calling on agencies and getting those deals and I know it ain’t going to scale, and I know the networks are going to gut me, I’m going to go learn about ad exchanges, I’m going to go look at my contracts with my networks, I’m going to think about my sales team. How do I move from this short-term to longer term, more strategic consultative sales organization, what are my steps?

Doug Weaver: Well first, I think you need to look at, you need to really divide the work that’s being done by your sales team into two distinct spheres: your strategic business, and I have a term for that, I call it ‘marketecture’, that’s where, you know, we’re operating at a high lever, we’re calling them higher level clients, the higher level agency people, we’re talking about unique capabilities of our site, our network, you know, our company, and applying those before the sales cycle, right, we’re getting out ahead of this, right…

Susan Bratton: Mm hmm.

Doug Weaver: longer, longer sales arcs and so forth. That’s what you need your senior people to be doing. On the other side is the work that’s being done by most people within the organization right now and that’s the transactional work.

Susan Bratton: Mm hmm.

Doug Weaver: It’s, you know, as you put it, a churn and burn, it’s the RFP answering, it’s the ridiculously short time tables and so forth, and what I tell people is, “Look, you know, there’s only so many ticks in the clock.” You’re not going to be able to do everything, so you know you can’t just shut off that pipe. You still have to compete for the RFP driven business.

Susan Bratton: Yeah.

Doug Weaver: But what you need to do is shrink the work…

Susan Bratton: Mm hmm.

Doug Weaver: Right, it’s not a, you know, having that pipe there and seeing that dribble of dollars come out of it, that’s not a, that’s not the problem, the problem is that we have far too much time and effort going against that.

Susan Bratton: And frankly you can resource that with inside sales people and pretty junior people…

Doug Weaver: Mm hmm.

Susan Bratton: If you have one smart person managing that, you can have a lot of people working, doing the busy work it takes to perform in that world, that don’t cost a lot. You don’t need to pay people 120 plus, 60k upside…

Doug Weaver: Yup.

Susan Bratton: to do that kind of work. You can pay people 35,000 dollars, 40,000 dollars a year to do a lot of that work.

Doug Weaver: I couldn’t agree with you more, Susan. The issue is that you have digital sellers and now managers of digital sales teams who have come through the business doing mostly that kind of work.

Susan Bratton: Right.

Doug Weaver: So literally now you’ve got a 33, 34 year old manager or even vice president…

Susan Bratton: Making 180k a year.

Doug Weaver: Well, yeah, if you’re lucky…

Susan Bratton: Yeah.

Doug Weaver: You know, ‘cause he’s probably got offers for 220 out there.

Susan Bratton: Right.

Doug Weaver: You know, the old adages that you’ve got, the biggest problem that most digital, most digital sales leader have is that, you know, their best sales person makes 200 grand and doesn’t have a dry cleaning bill…

Susan Bratton: Right, never breaks a sweat.

Doug Weaver: You know, they don’t get out of the office ‘cause they’re just doing all this stuff blind behind the phone and behind, often behind email.

Susan Bratton: Right. I bet there are some people listening to this right now who are thinking, “Yeah, that’s me.” So how…
                                                                               
Doug Weaver: Or they’re thinking, “Who is this jerk, and you know, who is he describing?”

Susan Bratton: Right, and now how do we teach consultative selling?

Doug Weaver: Well, I mean, without doing a plug for what we do, I mean we have our own take on it. There are certainly a lot of, you know, great, you know, consultative sales training, you know, programs out there. But I think that before you get to training and teaching, I think it’s really critical to make some structural changes in how your teams are organized…

Susan Bratton: Yup.

Doug Weaver: Because, you know, sales people as we know, and you and I are both sales people, you know, they’re, you know, they’re like water, they will find the lowest level, so we have to fence them off, we have to create some arrogation ducts and say, “Okay Steve, you’re a senior seller, we’re paying you, you know, we’re paying you close to 200 thousand dollars in total compensation. Your account list just shrank. You know, you’re now dealing with one third of the accounts that you were…

Susan Bratton: Yup.

Doug Weaver: They’re all maimed accounts. We need you to go deep.”

Susan Bratton: And these need to be million dollar deals and you’ve got six months to show me you can get them started and going.

Doug Weaver: Yeah…

Susan Bratton: Give him the air cover.

Doug Weaver: Yeah the million dollar deal part, I mean that’s all going to be relative to the…

Susan Bratton: Right, size of the publisher. Yeah.

Doug Weaver: amount of inventory people have, but you’re right, it’s got to be, you know, there’s got to be that…

Susan Bratton: Top ten percent.

Doug Weaver: you know, that number put in place…

Susan Bratton: Yeah.

Doug Weaver: whatever the number is.

Susan Bratton: Yeah, top ten percent deals.

Doug Weaver: Mm hmm. And I think also, you know, it’s going to be critical to, you know, have different kinds of metrics to look at. Very often the sales director just looks at, you know, just looks at that bottom line revenue figure. And it’s very easy to sell your company short and do a lot of things that are very destructive.

Susan Bratton: Mm hmm.

Doug Weaver: So what I suggest to them is you start to look at the other metrics. Look at deal size, right, look at distribution of the deal, how much premium inventory are we selling versus also having, you know, good running site, reach oriented buys as a part of what we do. There’s a number of different metrics that can be, you know, that can be much more instructive. And I like to say, “You know, look, if you can, if you can measure it, you can manage it”, and, you know, you should be very creative about how you compensate people…

Susan Bratton: Absolutely.

Doug Weaver: And you could also compensate them based on whatever numbers make the most sense and how you want to build your business.

Susan Bratton: Yeah, ‘cause you move your top, you move your top earners into something that’s longer cycle, more strategic, you’re pushing them to a new level. They’re going to get, they’re going to get scared. You’ve got to think about that. You’ve got to think about the long-term with these people.

Doug Weaver: Susan, just one last thing I just wanted to touch on here because, again, I mentioned sort of shrinking the work and how do you take time and effort and people out of that lower value, more transactional activity, and one of the suggestions that I make to customers all the time is, “Look, take the customization out of it.” You know, we have, we have this really destructive habit in our business of every time an RFP comes in the door that’s due tomorrow at three o’clock, we, you know, we scramble, we sort of, you know, we marshall all these resources and we create, you know, create power points and we create flash demos and we get engineering involved and all this other stuff, and honestly you’d be just as well served to create a form letter, ‘cause at that point in, at that point in time that deal is almost always about price, availability and a little bit of functionality. So answer the questions, get in, get out. You’ll have the same win rate as you would if you go and write the Magnicarda for each one of them.

Susan Bratton: Alright, we are out of time. I need to wrap this and here’s what I want to know. I want you to end the show with some big picture thinking for publishers. You’ve given them some really good operating plans for how to morph their organization, the issues they should watch out for. Give us some big thinking to end the show.

Doug Weaver: Yeah, the idea that came to me as we were having this discussion in our seller forum about network, as I said at the beginning of the interview, you know, these didn’t just happen for no reason, they didn’t just spring up out of the ground. The, you know, they’re there to solve a need, and the need that the buyer really has, the client really has, and I think it’s going to be the key to so much of the development and the funding of online going forward, buyers need to buy big. They need, you know, they need reach, they need the ease of use and simplicity and the work flow that right now is enjoyed by network television…

Susan Bratton: Mm hmm.

Doug Weaver: So I can, I can pick up the phone, I can write, you know, I can make one call, I can write one check, and I can buy a huge amount of audience. So I, you know, what occurred to me was, you know, the future I think is all about networks, not the networks that we think of now, but all kinds of networks. So if you think about the web ad market place in the future, it’s going to be like a corner of the universe, you know, gillions of different solar systems, different kinds of networks, I mean everybody’s going to be connected. So if you’re, if you’re a publisher, you know, it’s going to be very, very difficult to stand alone. Now you’re going to be a part of a network one way or another, so the question is to you are you going to be the sun in that solar system or are you going to be a planet?

Susan Bratton: Mm hmm.

Doug Weaver: And I think that’s the choice that the publisher of the media company is going to have to make. Our friend Wenda at Martha Stuart Living, they’ve used a, they’ve used a company called Adafy to help them create Martha’s Circle, right…

Susan Bratton: Mm hmm.

Doug Weaver: find other like sites, create their own constellation, their own universe.

Susan Bratton: Glam Media, same with Glam Media, they’re confederation.

Doug Weaver: Precisely.

Susan Bratton: Mm hmm.

Doug Weaver: So there’s, and there’s all different looks at this. I think that the only really bad course of action for the publisher is to deny the…

Susan Bratton: Change.

Doug Weaver: the core reason why these networks exist and just refuse to play on any level. So you’re going to be, you’re either going to be running your own network someday or you’re going to be a part of somebody else’s. Size matters.

Susan Bratton: Doesn’t it always. Doug, really, really good show today. Solid, actionable, specific information with a ton of insights about the big picture of the industry. I just commend you so much for sharing this level of information with Dishy Mix listeners. I know that the people who are listening, every single one of you who has listened to this show knows somebody who needs to hear this information. I hope you’ll forward this episode with Doug Weaver of the Upstream Group to one or two or three of your friends who need to hear what’s happening in the industry. Also, I want to let you know that you can get a transcript of this show, so we have, this whole show, printed out and written down on our website at personallifemedia.com. That can be very helpful for you for those people who are too impatient to listen and maybe will read Doug’s important information. So please feel free to do that, share it with a friend, send a transcript to someone, and of course friend me in Face Book. Doug, thank you so much for all your great insight today. It’s been terrific to have you on the show.

Doug Weaver: It’s been nothing but a pleasure. Thank you Susan.

Susan Bratton: Alright, well, to all of you, thank you so much for tuning in today. We really appreciate you listening to Dishy Mix. Have a great day. Go out and sell something consultatively. Bye bye.