Ad Selling = B2B Selling (Part 2)

By Zilliant

Jun 28, 2023

In part two, we take a look at ways in which media and advertising companies can adopt intelligent B2B commercial technology to deliver a more dynamic rate-setting, negotiation, and proposal process. Read part one here.

How do we hit a moving target?

In the last 20 years, change has been the only constant for the media and advertising industry. The audience drives everything: where they are, how they spend, what they consume. The explosion of digital and streaming platforms has only increased the volatility of this moving target. Similarly, B2B distributors and manufacturers have been forced to evolve and embrace dynamic pricing capabilities.

The way it’s always been done: As we covered in part one, ad rate negotiations have followed a static model for decades, mostly predicated on precedents set in the past with little analysis factored into CPM changes. In the TV world, the scatter (or spot) market contains inventory that is sold after the network upfronts, generally at a higher rate. However, with the upfront model perhaps changing for good and the more dynamic connected TV (CTV) taking over, scatter-like negotiations will become the dominant mode. Media platforms must enhance the rigor with which they approach point-in-time rate-setting and negotiation.

Why it must change: Digital advertising has now eclipsed network TV advertising. Yet, most media companies’ data infrastructure and sales process haven’t changed with the times. This leaves them ill-equipped to respond in real-time with competitive rates that achieve revenue goals.

The solution: “There's a big need for a tighter B2B sales process and data science-driven tools. Media continues to evolve, with lots of different ways media is being consumed,” said PwC Principal Ron Otocki. “It just adds complexity when you try to have multiple models but multiple pricing structures. There is a need for software that can structure everything and keep everything in a dashboard that people can track.”

Traditional B2B companies have found the answer to meeting increased customer expectations in a volatile cost environment by standardizing on one pricing system of record. This approach, combined with a real-time pricing engine, pushes the right price changes to every customer touchpoint instantaneously. This same principle can be applied to the media world. Speed and intelligence is the winning formula in today’s rate-setting environment.

How can we improve the negotiation process?

 

Ad sales are often heavily negotiated on multiple levels. The intricate dance between media platforms, ad agencies and agency clients contains many stakeholders with disparate motivations.

The way it’s always been done: One common scenario is a negotiation that happens at an advertiser level that’s being conducted by an agency. Then there's a second level of negotiation between the agency and all of the clients with that media platform. For example, the agency may say to the platform, “We're getting a 4% increase. That's not right. The marketplace is only a 3% increase. We need to get that down or we're going to move our money to another platform.” The media platform has little ability to instantaneously pull up the relevant data to cross-check this claim and reference historical information. Instead, it may lean on numbers pulled from a spreadsheet that isn’t up to date and wind up negotiating from a position of weakness without all the facts.

Why it must change: Every percentage point and dollar of revenue counts in a cutthroat environment. Media platforms are running the risk of giving back too much of their share of the pie in these negotiations. This isn’t due to a lack of data, per se, but a lack of organized data that gets transformed into actionable negotiation guidance.

The solution: The data is all there - we have access to more data than ever in a digital world. Media companies just need to right tools to harness and execute against the data. It’s a massive opportunity for positive transformation. Imagine the head of sales being able to instantly look at the entire universe of advertisers and accurately predict what inventory could sell for and to whom.

A price optimization solution like Zilliant Price IQ® can analyze massive quantities of customer transaction, quote and third-party market data to deliver optimized rate guidance that meets revenue targets. Negotiation guidance, informed by price elasticity measurement and P&L goals, helps account reps better negotiate CPM and ad spots for customer-specific rate situations. Built-in rules and constraints can even automate negotiation decisions at the point of quote. This is how companies across the B2B spectrum are giving the power back to their commercial teams in high-pressure negotiation decisions.

How do we speed up the proposal process while being more accurate?

Proposals are often built in response to a request for quote. In this scenario the account rep is reliant on what the advertiser is telling them they need now, measured against what that customer’s spend history looks like plus any changes in the wider market. With spreadsheets, emails, and even fax machines the only tools at their disposal, proposals are often delivered slowly and inaccurately.

The way it’s always been done: It’s true, a lot of business is still done via fax. An agency or an advertiser requests a quote over fax, with very simplistic instructions: “Same mix as last year, equal flighting.” The media planner has to infer a lot to build a proposal around that.

Why it must change: Astute readers will note that a business that is still operating with these technologies likely lacks the capabilities to automate the proposal process or inject intelligence into the rates they are ultimately quoting. The result is slow, error-prone proposal delivery that leads to a bad experience and worse financial results.

The solution: It’s time to sunset the fax machine and the spreadsheets. Zilliant Deal Manager™ is an application that has been proven to streamline the creation, management, and renewal of B2B customer-agreements and automate the quoting process. It is the next-gen method to govern the process from building the proposal, to managing the deal, all the way through to contract signature.

Get in touch to start your dynamic rate-setting, negotiation and deal management transformation today.

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