This is another excerpt (read Part 1 here) from an interview I did last week with someone who could really help the advertising sales industry (or anyone in it who was willing to listen.) I’ve changed her name to prevent petty problems for her in the future. I’ve also redacted names of companies, media, and people. They’re not crucial to the story. As one person put on twitter: These stories could be true of any medium or industry.
In part 2 below, Sally and I illustrate one of our shared frustrations: If you have my best interest at heart as a rep, shouldn’t you know which proposal is best for me? Why are you showing me three? Here’s why …
Sally: So we started on the three proposals. One was twice what I asked for. The other was time and a half more than I asked for. Even the lowest price wasn’t what I asked for. It was three or four thousand dollars more.
Tim: Where do they learn this? Let me ask you: one my great frustrations when I left broadcast and went to the client side.
I immediately started representing a few clients that I had known for years. I knew their businesses as you had described and would lay awake at night thinking how I could help these guys because my fee increases are based upon their growth.
So my first time the annual buy comes around. And again, I gave her a very specific set of criteria. “I said I want this, this, this and this. We have this much to spend. Period.” She doesn’t bring me any of the information I asked for. She brings in three packages. The first is one and half times what I gave her. So it’s 50% more than I said I could possible spend. The lowest possible plan is 50% more. The top package she brought she was six times higher.
Sally: You do realize there is a very specific strategy they use. Have you heard of this?
Tim: Tell me about financial sizing. I’m but a humble scrivener and these strange ways of money-changers frighten and confuse me.
Sally: It’s well-known through media if you have any time in the industry as a media rep you are probably familiar with the concept.
The way it’s taught is that you take the budget the client gives you. Your rep didn’t even do it well. You take the amount. Let’s say you give $10,000. That’s your small, most conservative level.
Then you are going to put together a moderate level that would have some bells and whistles and be a little more attractive to them and that would be a $15,000 proposal. Then you are going to have an aggressive level that would again be one and half times. So by the time you get done, you’ve laid out three levels in front of the client, the aggressive, moderate and conservative and so what it makes them do is look at the things they wish they could buy that are out of their price range.
They may be great options for them should they be able to do it but what it does is takes the focus off of what’s right for the client and makes them want more money. So they look at that and they go well, I don’t want to be cheap but I can’t afford that. And nine times out of ten, sales managers teach you, they’ll take the middle package. The rep comes away with more money than they would have.
Tim: So, in my instance the rep was just bad at the math because if we had a $60,000 budget and the lowest one she offered me was $90,000 then she just did it wrong. And her aggressive plans were over $360,000. But she’s just not very bright. To get back to your story. I apologize.
No, I think what you bring up is a very important question because something’s missing in training and education.
Sally: No, I think what you bring up is a very important question because something’s missing in training and education. They are not being taught to consider strategy or, I don’t know what would be the right word to figure it out, but because they get confused and they don’t know what to do, my manager said to me here’s what you do every time. Follow this formula.
Tim: The script. Back to the darned script.
Sally: Right. Here’s the script, here’s your formula. Just go do it. And then what happens is the rep doesn’t understand why they are doing what they are doing. They get frustrated in the fact that they are not having very much success and quit. And then there’s so much turnover in the industry that there’s a huge credibility factor and it’s a big cycle …
Tomorrow: Managing out of fear. Stay tuned.