Outsourcing: Its NOT About Headcount

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Outsourcing Its NOT About Headcount

• Presented by
• Jim Taszarek, President
• Public Radio Partners

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Outsourced UnderwritingIs it right for you?

• Reasons stations have outsourced
• Considerations in decision
• How it works
• Elements of an agreement

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Outsourced Underwriting Defined

• Complete responsibility for underwriting
• Accountable for achieving station goals
• Local sales staff representing station
• Managed and employed by PRP
• Revenue from marketing, advertising and community
  relations budgets

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Stations PRP Represents
Phoenix
Nashville
Seattle
Austin
Las Vegas
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PRP Employees

• Principals
• Kirk Nelson
• Jim Taszarek
• 25 Employees
• Combined, over 200 years of
• marketing experience
• sales experience
• corporate support experience

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PRP Vision

• Attract the best people who together create the
• standard of excellence for corporate support
• in Public Radio

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PRP Mission

• Link stations and corporate supporters in a
• mutually beneficial relationship that enables
• the station to better serve the community and
• helps the underwriter grow their business

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PRP Philosophy

• Public Broadcastings
• Quality Programming
• Non-commercial nature
• Are what the audience and underwriters value
• Respect and protect that nature in order to
• make underwriting a significant and sustainable
• revenue source

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Track Record of Sales Growth

• Year 1 - 19
• Year 2 - 29
• Year 3 - 25
• Year 4 - 21
• Year 5 - 18
• Aggregate billing performance for each year in a
• market

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Reasons Stations have Outsourced

• Greater revenue
• Accelerated department performance
• Create stability
• Professional sales management
• Improved relationship with sales team
• Improved department performance without need to
  focus on underwriting
• Transfer risk of growth

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Station Benefits Beyond Expectations

• Morale improved beyond expectations
• Growth was higher than expected
• More conservative on copy guidelines than
  expected
• Transition to outsourced organization easier than
  expected
• Less HR to manage
• Brings new ideas in from other markets
• Working with folks who "get it"

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Considerations In Your Decision

• Revenue Performance
• People Investment in People
• People Talent of Underwriting Team
• Inventory

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Revenue Performance

• How does the stations underwriting performance
• compare to
• Industry
• Market
• Station needs

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Investment in People

• New rep guarantees
• The Big Risk high hidden cost of turnover
• The cost of staff turnover in underwriting
• New rep minimum 20,000
• Experienced rep attrition in accounts could be
  more

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Talent of the Underwriting Team

• Does the Underwriting Manager have experience and
  track record of underwriting management success?
• Recruiting
• Managing salespeople
• Inventory management
• Team revenue growth
• If not, can I hire a person with this
  experience?

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Inventory

• Your second greatest resource in underwriting is
• Inventory
• Radio and television, being intangible mediums,
  requires expertise in proper yield management

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Yield Management

• Price forecasting process
• Maximize revenue and yield from inventory
• Provide predictive strategic information
• Goal
• Max number of customers
• Max price levels

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Considerations In Your Decision

• Revenue Performance
• People Investment in People
• People Talent of Underwriting Team
• Inventory

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How It Works

• Alignment
• PRP approach

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Integration of Underwriting Dept.

• Goal Build trust and understanding
• Programming
• Inventory
• Copy
• News
• Business
• Traffic system utilization
• Collections process
• Development
• Joint effort
• Leads generation

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PRP Systems and Tools

• Process
• Sales
• Sales Management
• Recruiting
• New Hire Start Plan

• Tools
• Training
• Intranet
• Sales Database
• Underwriter Appreciation Program

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Elements of an Outsourced Agreement

• Exclusive agent for all local and national
  underwriting
• Clearly defined underwriting inventory
• Outsourced organization provides
• Underwriting sales manager and staff
• Station provides
• Ratings and Qualitative data
• Traffic and billing functions

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Elements of an Outsourced Agreement

• Commission only - paid on billing
• Agreed upon annual billing budgets
• Special promotions
• Station approves underwriting copy
• Indemnification
• 5 year agreement
• Spirit of the agreement

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Questions?