local media insider

It's not the people, stupid

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We've come a long way since the idea of separate business units was first articulated. 

The idea was fielded - and largely ignored - by established media years ago, first by  the "Newspaper Next Project" and then by Borrell & Associates who made it a mantra.  In reality it is clearly impossible to build a new company that takes advantage of disruption in the marketplace, by operating  inside the organizational structure of the old company.  An independent business unit - not company - is needed.

But the original idea infiltrated its way into established media in pernicious ways - and that is one reason why it was not adopted faster. For one thing, many executives interpreted the theory as meaning that everything digital had to happen over there

Today not even "separate or perish" guru Gilbert Clark is willing to go that far. 

Remember when some legacy teams were often not even allowed to sell digital?. I personally battled this one out in the C-suite, lost, and had to explain to print reps why they were too... ?... to sell digital campaigns. No fun.

We've all seen a gungho digital expert deploy a fancy new sales team - and denigrate established media teams as people who "can't do it" - without being able to produce revenue results, new market share or new business models. Ouch.

Eventually most of these  "separate teams" collapsed into an integrated sales force because the pure digital sellers simply could not sell accounts in competition with legacy reps whose relationships went back years. By the time the point was won, time was lost, trust was an issue, blood was all over the floor. One of the victims was the concept of the separate business unit itself.

How about the old argument: If the legacy reps won't sell digital, by God, the digital only sellers will. Trouble was, this approach failed to leverage current relationships and still did nothing to build marketshare. It just threw more resources into the same old accounts, who, by the way, were not all that jazzed up about banner ads to begin with. Today, if advertising sellers can't sell digital, they are out of a job.

On the other hand deep search products seemed to do best with a new sales team, but could be sold by the legacy team, with at least an initial assist. Ah ha!

Clearly media sales teams had been over-analyzed and misunderstood. Fortunately most media companies have gotten better.  And today, a small, but level-headed cadre of executives is creating separate business units again. This group understands how to value and utilize  legacy teams, and fully articulate the areas where separate teams run by a parallel new unit, developing new products,  are best deployed. 

Television stations, never had the sheer number of local accounts,  so creating a new digital only team to sell new digital only accounts, and reporting to the head of interactive, made sense at  WBOC.com, this week's case study. This core team will eventually launch independent products as well. The reporting structure for a new business unit will be largely in place, should the company head down that path.

It is within this calmer, cooler environment that the dialogue about separate business units needs to take place, again, around the country.
One of my mentors used to have a saying, "It's the people, stupid."  Today, the reverse is true. Not to dismiss the importance of hiring digital DNA, but new business units, especially in small markets like Salisbury, Md., may find themselves composed of many of the same old people - or ex-legacy reps from other companies - doing new and exciting things (WBOC's new digital sales manager, Bill Vernon, for example was a top TV seller a the legacy site).  
If you don't hire them, Patch, ReachLocal and the Examiner will be happy to, not to mention the rumored new Google local sales team.  Local media employees need to know that their company has a future, and that they will be included in it.  

Already most large media companies have corporate interactive positions who regularily create programs they hope will be a little like lightening streaking down to reenergize the digital sales effort - but which don't always, well, have that effect. 

A greater scope of mission -  to take more of the digital marketshare in their DMA away from all the other digital competitors  - requires investment and, yes, even the dreaded digital-only sellers. This time, however, maybe the new interactive sellers will finally focus on gaining new markets and their managers will understand and respect the talent within the legacy company. 

New business units, with, this time, more respectful management, can provide legacy sales people and managers with more opportunities, not fewer, within their own company. Good for all concerned.

Comments

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  • howardowens

    There's a premise in this piece that I disagree with, it sort of starts with, "pure digital sellers simply could not sell accounts in competition with legacy reps whose relationships went back years."

    You're right, it's not the people, but what you fail to say is, "It's the business model."

    It's not enough just to have a separate sales model, legacy media companies need to start completely new business units.

    You worry about the competition, but competition is exactly what needs to happen, of the disruptive kind.

    You say the previous separate efforts failed. I content there never has been truly separate units. When I discuss this issue, people will point me to Belo or Knight-Ridder, etc. But all of those efforts were based on legacy media efforts -- they were involved in selling against what the legacy newsroom was making. This creates all kinds of turf war issues, brand confusion, mission creep, etc.

    What needs to happen is local news companies, if they want to ensure long-term survival, must create completely separate operations -- news, sales, operations, leadership, the whole shebang.

    Back to your original statement -- legacy sales teams have no particular hold on relationships. Look at what I've accomplished with my business. I've had no trouble selling against a legacy team. I've succeed because this is competition, not cooperation. There's no worry about what impact my efforts might have on the mother ship, and I'm able to set my ad model and sales model around what I think will work best for the business, not beholden to any considerations related to the legacy organization, including feeling I must meet margins satisfactory to the legacy CEO.

    There is an aspect of it, "It is the people, stupid" that must not be forgotten and is foundational to the lessons of disruptive innovation that Clark Gilbert preaches -- legacy staff, through no fault of their own, because they're not stupid, will never accept, understand, be able to effectively deal with, disruption. You can't have people who have legacy goals and motivations involved in a disruptive operation.

    Here's something I wrote on the topic two years ago: http://www.howardowens.com/node/7348c "The Newspaper Original Sin: Keeping online units tethered to the mother ship"

    Friday, March 25, 2011 Report this

  • Alisa Cromer

    I don't think we disagree. I'm just making the case here that not all media transformations will be as immediately violent as Autotrader.com, which had no news team to leverage, and may look more like Deseret Media, in which there are shared spaces, but separate reporting all the way up to - or down from - if you will the C-level.

    My larger point however, is that those still burned by the experience (and attitudes!) of the separate sales force experience need to take another look at the separate unit model, which has more energy, more market to be had, and ultimately will enable more people in the larger corporation to stay employed by moving over into new jobs as old ones are cut, if they have the ability and passion to do so.

    Why would anyone under the age of 45 accept a top management role at a newspaper for example, unless they knew they would not only participate in the digital transformation, but would also have the ability to transfer into a different business unit if the original one needed to scale down quickly.

    You only get this option if you HAVE other business units, and if the C-suite is committed to transferring great managers or sales people who want different and unique challenges out of the legacy company if downsizing occurs. This gives the entire company an opportunity to support separate businesses, as long as the people are valued and not blamed. Otherwise, they should move on to work for ReachLocal or Pandora, where they know growth opportunities are better.

    Friday, March 25, 2011 Report this

 
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