Advertising is a mainstay for online news startups, and successful sites rely on direct sales of ads at premium rates. This free webinar looks at key takeaways from the presenter's recent report on best practices for ad sales for startups for the Tow-Knight Center for Entrepreneurial Journalism. Learn how local and national online news startups are professionalizing their ad sales and growing revenue.

1. Best Practices
for Ad Sales
at News Startups
Michele McLellan
Sept. 15, 2015

2. Study of ad sales
 Published in 2015 by the Tow-Knight Center
for Entrepreneurial Journalism at CUNY
 22 news sites
 Mix of local, state and national
 Mix of general news and topic niche sites
 Track record with advertising

3. Key findings
 Recruit ad sales professionals
 Identify advertiser targets
 Develop a rate structure
 Charge premium rates

4. Professional sales
Competition for sales pros is fierce
Look to readership to identify prospects
Employ a full-time rep
“Finding the right sales people as
definitely been the hardest part.”
- Kelly Gilfillan, Home Page Media Group

5. Compensation
 Combination of salary and commission
 Incentives and bonuses
 Adds up to a living wage
“We wanted our sales person
to have the opportunity to
make $70,000-$75,000.”
– Kim Clark, Noozhawk

6. Example
:
 Base pay $25,000-$30,000
 Commission 10%
 Compensation: $50,000-$80,000
 Site revenue: $500,000 - $1 million

7. Example
:
 Base pay 50-75% of total
 Total: $80,000 - $250,000
 Revenue: $8 - $10 million

8. Example
:
 Commission only
 Commission starts at 30%
 70% after monthly sales goals met
 Profit sharing program
 Revenue: $50,000 - $100,000

9. Qualities of a good sales rep
 Deep community knowledge
 Persistent
 Positive, can take rejection
“They need to be embedded in
the town and know everybody.”
- Peter Blasi, Riverhead Local

10. Targeting advertisers
 Understand businesses’ problems
 Network in business community
 Ads raise awareness
It requires “knowledge of your
local businesses, understanding
the troubles they are having or
the successes.”
- Lance Knobel, Berkeleyside

11. Focus on direct sales
 Premium rates
Impression-based rates (CPM) are
plummeting
 Long-term contracts
“At one point CPM’s were $10. Now
they’re a lot of times below $2.”
- Michelle Madhok, She Finds

12. Stick with a rate structure
 Figure out how much you need to stay
in the black.
 Create a rate structure and a rate card
 Set sales goals
 Aim for monthly contracts, sell multiple
months
Without a rate structure,
“everything is up for negotiation.”
- Kim Clark, Noozhawk

13. Example
:
 $200 a month for display
 $100 a month for sponsored posts
 $75 a month for event promotion

14. Example
:
 $4,000 per week for daily advertising
across its networks of sites and its
newsletters
 CPM pricing from $25-$60 depending on
size and placement

15. Example
:
 Prominent display, high-traffic
placement: $1,450 a month
 Run of site $165 - $600 a week, with
discounts for yearlong contracts

16. The payoff
Sites significantly increased revenue after
improving their sales operation.
Improvements included:
 Professional sales person - a full-time hire
or a business partner
 Deep connections to the business
community
 Rate structure based on actual revenue
needs
 Premium rates and direct sales

17. Thank you!
Ad sales study available at www.towknight.org
Info.micheleslist@gmail.com
www.micheleslist.org
www.michelemclellan.com
Questions?