Tag: price

Industry Views

Sabo Sez: Make More Money Selling Emotion

By TALKERS | by TALKERS

By Walter Sabo
Consultant, Sabo Media Implementers
A.K.A. Walter Sterling
Radio Host, “Sterling On Sunday”
Talk Media Network

imIt seems every hour Nielsen and Pierre Bouvard of Cumulus fame (formerly of Westwood One) put out a release stating that radio is just fine, thank you. Radio is more persuasive than TV, direct mail, streaming and print. Radio is a proven success for over 100 years. Most of the buildings housing Procter & Gamble were built on radio – not TV – advertising success. Happily, P&G realized radio’s clout and is now a dominant radio advertiser – again!

Audience data, facts, do little, if any, good. Based on the facts, radio should be the number one local advertising medium. It’s not, direct mail wins. Value Pack.

Every year radio’s revenue goes down. Many stations deliver consistent ratings and consistent product – yet they are going down in billing. Selling hard numbers, provable numbers, is not growing the industry.

Why do you buy stuff? Quantitative numbers are not driving revenue. What’s an option? Why do you buy… anything? If you’re buying an essential item like milk, the purchase is price driven. But radio is not an essential ad buy, yet the sales challenge is met by lowering spot rates. That hasn’t solved anything. Lower spot rates make overall revenue worse by lowering perceived value.

Your non-essential purchases are determined by price and emotion. Do you need that? No, but you want it. What does radio provide to a listener? EMOTION. Music and talk radio elicit emotional responses. Profound, deep, emotional responses. Why do clients cancel talk radio? Because they are offended, embarrassed or angry. Why do clients cancel a music station? Because they hate, can’t stand or are offended by the songs. Media buyer emotions drive capricious, rapid ad campaign cancellations. (Why do you get fired even though your numbers are just fine? Because you offended somebody.)

If numbers don’t maintain a buy, what would compel a buy?

Tangibles plus on-air emotion. Tell you a secret. Most TV media buys are for shows, not audience. Right. Math-driven media buying services buy TV shows they like.

Suggest we look to move off the spreadsheet, the programmatic, and enter the warmth of emotional selling, selling to a buyer’s personal likes. (Jingle Ball – genius!) Personal likes. The numbers aren’t serving the need for revenue growth. Soft drivers: Concert tickets, prize winners, food, free tracks, buyer names on air, parties, gift for kids. Old school? No. Proven school. New school isn’t working. Turn radio’s air into tangible, shiny objects. Radio elicits emotional responses, let’s sell to them. That’s powerful! More powerful than time spent listening.

Walter Sabo has been a C Suite action partner for companies such as SiriusXM, Hearst, Press Broadcasting, Gannett, RKO General and many other leading media outlets. His company HITVIEWS, in 2007, was the first to identify and monetize video influencers. HITVIEWS clients included Pepsi, FOX TV, Timberland, Microsoft, and CBS Television. He can be reached at walter@sabomedia.com and www.waltersterlingshow.com. “Sterling On Sunday,” from Talk Media Network airs 10:00 pm-1:00 ET, now in its 10th year of success.

Industry Views

Pending Business: Price = Value

By TALKERS | by TALKERS

By Steve Lapa
Lapcom Communications Corp
President

imThink about the concept for just a minute. Manhattan Island for $24? Peter Minuit knew value.

Two of my favorite sales training exercises are the Timex vs. the Rolex and the Bic vs. the Monte Blanc. In each role play we pit price against value with intangibles like prestige, self-esteem, peer recognition and good old Sam Walton-style common sense surfacing in the role play.

Sales managers reading this column should try those exercises to help develop and sharpen the skill sets necessary for success in radio-audio sales.

Price theory is now faced with two variables that may redefine value: inflation and meta-data, two distinctly different forces that can test our tolerance of price in the value equation. Stay with me, this gets simple, fast.

Assume almost everything costs more, you can pick your favorite reason. Mine is the price of men’s haircuts. I always wonder why the less hair I have, the price still goes up. Less hair, less time to cut, lower price? I have tried, but the price goes up every year. Why? The answer is the most important variable in current price theory, mastered by the airline-tourism business and it is about to be tested at a quick-serve restaurant near you. It is called demand, or in the Uber-driven currency, “surge pricing.” Eventually, you will be hit, even shocked, with the demand curve surge-pricing model.

The theory is simple: when just a few seats remain on the airplane or the hotel is heavily booked, the price goes up. When you desperately need Uber for a ride from the airport during rush hour, the price for that ride is different from the ride during non-rush hours. How about tickets to your favorite event? Sports and concerts have been in the demand-pricing business as long as someone was willing to pay. Surge pricing is a newer twist but has historic roots in tipping the maître d or the valet.

Now comes the latest price model. Just how hungry are you? Imagine your favorite dining spot changing menu prices by variables such as time of day, day of the week, number of orders waiting, even the number of cars in the drive-thru lane. Imagine watching the prices on the digital menu board change before your eyes based on the number of people waiting in line. This is not speculative price theory; it can start tomorrow or not.

Pricing has one variable we all take for granted. The customer, or in our case the advertiser. What is tolerated and what is rejected? We are privileged to operate in a market-driven economy. What variables will go into your pricing model today?

Steve Lapa is the president of Lapcom Communications Corp. based in Palm Beach Gardens, FL. Lapcom is a media sales, marketing, and development consultancy. Contact Steve Lapa via email at: Steve@Lapcomventures.com.