To help media sales leaders determine the best approach to these uncertainties, Alexander Group held a virtual Media Advisory Council (MAC) session that centered on the following topics:
- Instituting quota relief/guarantees
- Adjusting sales compensation rates and thresholds
- Prioritizing top of funnel activities
- Deploying Management By Objectives (MBOs)
- Using new products/verticals for reconnecting with clients
- Changing/shifting activities for key commercial roles
With over 100 participants, the discussion included findings from Alexander Group’s recent Media Sales Compensation Surveys and key insights from media executives at Microsoft Advertising, Intersection, LinkedIn, Digital Trends, Condé Nast, Tribune Publishing and Xandr. Using live polls to gauge the audience’s response to the current crisis, the conversation highlighted near-term sales compensation plan design change options, along with sales compensation considerations for the “right now” and the remainder of 2020 into 2021.
The Right Now and Immediate After
Media sales is in a state of uncertainty. The majority agree that changing seller base pay is not the best option for motivating and retaining their teams. Only 8% of media sales leaders surveyed indicate that they are planning on temporary base pay changes. Instituting quota reliefs and altering guarantees, however, seem to be top of mind. 71% of media sales firms are considering some sort of quota relief and 69% are planning a guarantee of at least 50% target incentive. The CRO from a leading global entertainment digital platform stated, “We are temporarily shifting away from goals tied to EBITDA. It gives the seller more control and confidence, ideally to help us retain talent.”
Rather than focusing on results, media firms are emphasizing the opportunity for sellers to drive customer engagement to build on current relationships and start new ones. One digital publisher stated that they have temporarily changed the way they incentivize sellers and are now providing cash payments based on new funnel opportunities. This new go-to-market approach provides an incentive for sellers to reach out to new and existing contacts to generate additional conversations. For lead generation, media firms are holding virtual events including webinars and roundtables to keep in contact with clients. While there may not be an immediate monetary impact, these additional interactions can also build up customer relationships. Although many have yet to implement, 77% of the audience feel that results-based MBOs to track active advertisers, new deals and new logos would be most useful for their organization.
Repositioning sales team members is also a top priority. Shifting sales from categories that are on the downturn such as travel and luxury and moving sellers to categories with high demand such as tech is essential to drive revenue in the current economic state. According to the VP of Strategy and Operations at a leading integrated print firm, “We are suspending compensation for specific sales teams who normally sell activities related to our events and sponsorships. We are providing guarantees and have zeroed out their quotas until the end of the year.”
The consensus? The best plan of action for now is to define and institute short-term incentive strategies, convene sales compensation governance committees and dynamically model organizational cost exposure. For the remainder of 2020, media sales leaders should review second half goals, adjust measures with new sales priorities and review job responsibilities.
Uncertainty continues into 2021. Almost 50% of media sales leaders surveyed indicate that they are not sure if they will conduct a comprehensive revision to their sales compensation programs for the coming year. For the upturn, the focus remains on evaluating strategic accounts and high revenue areas to position the sales team on the most lucrative opportunities. With this comes the need to review the entire sales compensation program for alignment with these new go-to-market realities.
The current situation presents a constantly evolving and uncertain environment for media organizations. Revenue leaders need to address the health and safety of their employees, how to manage sales compensation to motivate and retain talent and determine how to formulate the best go-to-market approaches for when market conditions improve. Additional virtual MAC sessions will be held on May 13th and 20th to discuss preparations to ramp up including strategies for future revenue management planning. To register, please visit our Media Advisory Council webpage or contact an Alexander Group media sales practice lead.
Authored by The Alexander Group, Inc.®