Working with Independent Sales Reps
How the role of reps is changing with integrated media.
With all the talk of outsourcing (production, art direction, even editorial), it‚Äôs easy to overlook the fact that the revenue-generating function of the magazine business‚ÄĒsales‚ÄĒhas long been outsourced with no one batting an eye. Whether through individual reps or a dedicated rep firm, few external employees are so key to the long-term success of a publication.
But today, as the market emphasizes ‚Äúintegrated packages,‚ÄĚ the role of the independent rep may be less clearly defined, even as the internal sales staff struggles to redefine themselves. Should independent reps sell everything on the menu or are they better suited to just print? Or, is there an opportunity for specialist reps to focus on specific media like digital, events or data because the regular sales staff doesn‚Äôt possess those talking points?
Folio: spoke with a cross-section of the publishing sector: large consumer, b-to-b and city & regional publishers to determine where the independent rep fits in today and how to best work with them.
Reps as ‚ÄúPart of the Family‚ÄĚ
Independent sales reps account for about 40 percent of the total ad sales for American Express Publishing‚Äôs Travel & Leisure, according to vice president and publisher J.P. Kyrillos. The magazine uses contracts with independent sales reps responsible for territories such as San Francisco, Atlanta, Chicago and Toronto. The magazine also leverages reps around the world for international sales. ‚ÄúSales reps are integral to our business,‚ÄĚ says Kyrillos. ‚ÄúThey are independent reps but to be honest, I don‚Äôt think of them differently. Whether you‚Äôre a satellite office in Los Angeles or an independent in San Francisco, they‚Äôre interchangeable.‚ÄĚ
Travel & Leisure reps are selling ad space in the magazine as well as digital with Travel&Leisure.com. ‚ÄúThese guys have amazing relationships in their market,‚ÄĚ says Kyrillos. ‚ÄúMost are print shops but they‚Äôve taken on digital. The relationships don‚Äôt always cross over, sometimes they work, sometimes they don‚Äôt. When you‚Äôve got someone who owns a small business, they‚Äôve got to make sales to put food on the table. That‚Äôs a motivated salesperson. I want all our salespeople to feel like they‚Äôre running their own small business.‚ÄĚ
Reggie Lawrence has seen both sides of the equation, working as a longtime independent rep for Penton Media‚Äôs Fleet Owner before joining the magazine as national sales manager earlier this year. ‚ÄúSomebody had to step up and Fleet Owner was more than a job, it‚Äôs become my life,‚ÄĚ says Lawrence. ‚ÄúOur reps really function as employees. To most of our customers, when they call up, they say they‚Äôre with Fleet Owner. We‚Äôve had people who have worked for years as reps, and a couple years into the relationship a client is surprised to find out they don‚Äôt actually work at Penton.‚ÄĚ
Reps for Fleet Owner are selling across the board. ‚ÄúThey sell everything‚ÄĒprint, online, larger sales that may be package buys,‚ÄĚ says Lawrence. ‚ÄúWe don‚Äôt dissuade them from selling anything. For us, it‚Äôs not about whether someone is an independent rep or a direct rep, it‚Äôs whether they have talent.‚ÄĚ
Fleet Owner has three internal salespeople plus three independent reps. ‚ÄúIndependents tend to be better for overall branding campaigns,‚ÄĚ says Lawrence. ‚ÄúThose are the guys the customer sees. They‚Äôre attached to everything. We don‚Äôt want them to just sell print, they need to speak to everything on the menu. Things like list rental we‚Äôll hand off to someone else but still they need to be able to speak about it intelligently, know that it offers, what it costs and be able to endorse it.‚ÄĚ
Publishers used to hire reps to cover a territory they couldn‚Äôt afford to assign to a full-time employee. ‚ÄúThat‚Äôs not the case anymore. If there‚Äôs a proven track record with a salesperson, we want to work with them,‚ÄĚ says Lawrence. ‚ÄúGood reps know their limits. They know not to take on too much because their performance will suffer and then word will get out.‚ÄĚ
Reps working with other publishers is typically recognized as part of the deal‚ÄĒas long as the rep doesn‚Äôt take on too much or work for a competitor, of course. ‚ÄúIf they‚Äôre a good rep, they‚Äôll be working with more than one magazine,‚ÄĚ says Lawrence. ‚ÄúThe biggest thing I see is the pressure to drive revenue. It‚Äôs a balance, I‚Äôm learning that now. When we hire independents or even direct salespeople it takes a good three years in that territory before that person reaches their stride. Some publishers come in and think that in the next two or three months that needle is going to move. In truth you‚Äôre steering a ship and it takes time to turn it.‚ÄĚ
Regional title Maryland Life has five internal salespeople and two independent reps selling both print and digital. ‚ÄúBoth of these contractors have specific regions of the state although they‚Äôre free to broaden horizons as long as it doesn‚Äôt conflict with a client someone else is selling,‚ÄĚ says co-publisher and editor-in-chief Dan Patrell, who adds that independent reps account for about 10 percent of the magazine‚Äôs total sales. ‚ÄúWe‚Äôre not actively hiring independent contractors left and right. The ones I have now, my magazine is their focus. I have worked in the past with other independent contractors whose plates were so occupied with other contracts, it was hard not to feel like we were an after thought.‚ÄĚ
Paul DeGrandis was a top salesperson at Hanley Wood who started his own rep firm. He says publishers should be focused on money, not time. ‚ÄúIt‚Äôs interesting that the publishers who didn‚Äôt engage me were very focused on how much time I could commit to them,‚ÄĚ he says. ‚ÄúMy response was, ‚ÄėIt‚Äôs not how much time I commit, it‚Äôs about how much money I‚Äôll make for you.‚Äô You can have someone bringing in five $30,000 accounts or five $60,000. I‚Äôm the guy bringing in five $60,000 accounts.‚ÄĚ
Outsourcing Events and Digital
Other publishers are seeing distinct skill sets emerge with rep firms for both digital and live events. Paste outsources event sponsorships with a company called BMF Media. ‚ÄúOur advertising team is used to dealing with media buyers rather than sponsorships,‚ÄĚ says director of marketing and events Caren Kelleher. ‚ÄúSelling pages and online takes up so much of their effort that it doesn‚Äôt make sense to reinvent the wheel and try to cultivate new relationships when there are reps out there who already have those relationships and can make those introductions for us.‚ÄĚ
Event sponsorships can be trickier. ‚ÄúEvents can‚Äôt be quantified like they can online or in print,‚ÄĚ says Kelleher. ‚ÄúYou‚Äôre selling an idea and asking your sponsors to trust you on whether you can deliver.‚ÄĚ
Popular Science, which sees about 24 percent of its ad sales from reps, looks for rep firms that do specialize in certain media. ‚ÄúOne of my rep firms has a digital arm and assigned us a different digital rep who clearly had contacts and hit the ground running,‚ÄĚ says publisher Gregg Hano.
Online-only publisher ThomasNet has an entire model built on independent reps, with 350 selling across country. ‚ÄúThey sell everything: the directory, content solutions, the newsroom,‚ÄĚ says director Paul Gerbino. ‚ÄúWe‚Äôre constantly tweaking and training, and really helping them understand how different offerings we have create a total solution. Every publisher in this Internet age needs to get out from behind the desk and spend time with their reps.‚ÄĚ
Sales reps ignore online at their own peril. ‚ÄúI don‚Äôt think independent reps can afford to be in the group still getting up to speed on the Internet,‚ÄĚ adds Lawrence. ‚ÄúThey‚Äôre compensated strictly on performance and more and more, that means selling online.‚ÄĚ
DeGrandis has worked with publishers where he oversees the print sales while the client handles the digital push. ‚ÄúOne of my clients hired an online salesperson and it‚Äôs great,‚ÄĚ he says. ‚ÄúDigital is more of a technical sale, so we work together and we both get paid.‚ÄĚ
Rep Firms as Strategic Partner
But what can the rep offer beyond closing the sale? There are a crop of dedicated rep firms that go beyond just banging the phones and knocking on doors to serving as a strategic partner to the publisher. Rep firm James G. Elliott, whose clients have included Kiplinger‚Äôs and National Geographic Traveler, prefers to work with publishers that don‚Äôt have a dedicated internal work staff and offers additional services ranging from research to marketing to booking and reporting. ‚ÄúWe‚Äôve had publishers ask us to examine their cost structure to see how we could do it more efficiently,‚ÄĚ says president Jim Elliott. ‚ÄúMy preferred accounts are ones where we‚Äôre partners strategically and execute tactically. We don‚Äôt want to overload our people. They work on one or two properties at the most.‚ÄĚ
Often independent reps aren‚Äôt used just for additional sales where it doesn‚Äôt make sense to establish a dedicated office but to break new territory or jumpstart a lagging market. ‚ÄúYou‚Äôre not given big territories, publishers are giving you smaller territories and you have to grow them,‚ÄĚ says DeGrandis. ‚ÄúI am strategically involved with all my clients. Some have very seasoned salespeople and I‚Äôm just one of the guys. Others, I‚Äôve had to take my experience from Hanley Wood and helped their organization get to the next level.‚ÄĚ
Independent sales reps usually work on straight commission, typically 15 percent to 20 percent (and that range applies for both consumer and b-to-b publishing). ‚ÄúThey‚Äôre always working on straight commission,‚ÄĚ says Lawrence. ‚ÄúIf you‚Äôre going to turn over an enormous territory to someone and there‚Äôs a lot of existing billing, it takes a lot of the risk away from the rep, and it gives them an existing cash flow where they can afford to travel. Other times the commission is 20 percent when it‚Äôs a smaller territory with smaller growth.‚Äú
Travel & Leisure lets reps out of a contract with three months notice. Reps are also expected to cover all travel and expenses. ‚ÄúThey‚Äôre generally only getting paid commission unless they‚Äôre just starting out. Then we might work out something to help get their business going,‚ÄĚ says Kyrillos.
While publishers are quick to say independent reps are ‚Äújust part of the team,‚ÄĚ be careful where the lines are. ‚ÄúIf you do impose a lot of demands such as attending constant office meetings, the IRS will set them up as a bona fide, full-time employee,‚ÄĚ says Patrell. ‚ÄúYou have to remember with a contractor‚ÄĒthey are independent. You have to be careful as to how you make requests on a contractor.‚ÄĚ
Paste offers its independent reps the same commission rate it offers the internal sales team but is clear about drawing the line. ‚ÄúWe‚Äôre cautious that a rep firm isn‚Äôt impeding on existing relationships our sales team has,‚ÄĚ says Kelleher. ‚ÄúIf, say, a telecom company is interested in sponsorships and the sales person already has a relationship there, we let the rep firm know we‚Äôre giving priority to our sales team.‚ÄĚ