Friday, December 9, 2011

Show me the money!

A lot of organizations tell us that every year their program book advertising revenues are eroding little by little...WHY? It is very important to watch your current ad revenue base. It is a huge misconception to believe that every year advertisers will just renew. We call this drop in revenue from existing advertisers "Decrease & Loss".

Most organizations never factor this in, and the expectation is "last year we had $30,000 so this year we'll shoot for $38,000, and we'll only have to sell $8,000" and off they go. You MUST factor in that every year you will lose between 20 to 30% of your base revenue, and in this economy we have seen as much as a 60% drop in ad revenue in some depressed markets. So using our $30,000 base revenue example figure on about $22,000 as your revenue base. So to achieve a target of $38,000 you will need to sell at least $16,000 of new revenue. If your staff is not up to the task you will be facing declining revenues and call reluctance from your staff if this is not planned for from the beginning.

So remember to factor in 25 to 30% drop in your revenue base and do your projections from that.....Good Selling!

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