With same-station revenues up 2.8% in Q4 while the RAB reported that the radio industry was down 4%, might Regent Communications be doing something a bit different than other public radio companies?
One Wall Street analyst asked CEO Bill Stakelin whether his company’s local sales staffs are smaller or larger than they were five years ago. “They’re larger than five years ago,” Stakelin replied, saying that exactly how much they have grown depends on the number of stations in a cluster and the size of the market.
“In revamping the efforts that we have in Albany, NY, which, as you know, is where we still have some developmental stations due to new formats that we launched and we’ve restructured quite a bit, and it’s our second largest market, we have been running out there with approximately 13 to 14 sellers and the new target calls for a minimum of 20 sellers on the street. In our larger markets I think you will find that we have 20 to 25 sellers, at a minimum, on the street and in a smaller market, like St. Cloud [MN], I believe more like 10 to 12,” Stakelin explained. Overall, he said, Regent’s sales staffs are 25-30% larger than five years ago.
Why does Regent need more people on the street? Stakelin says it was the result of research. Regent found that its existing clients were, over the course of time, spending less on advertising. And, of course, there was the attrition in the client base that has always been a part of radio – no doubt for all media. Regent management determined that it needed more sellers on the street to bring in new clients. “Existing clients are not buying as deep and not spending as much, so there is a need to increase the client base,” Stakelin explained.
RBR/TVBR observation: Invest in shoe leather. We’ve said it repeatedly – radio has to put feet on the street to grow business. In fact, that investment in larger sales forces is needed immediately just to stop the erosion. Even a really good seller can’t do much to bring in new business if they have to spend all of their time just servicing existing accounts from an oversized list. Repeat this mantra: Good sales people pay for themselves…Good sales people pay for themselves. Trying to reduce the cost of sales for an advertising supported business by having smaller sales staffs is insane.