Hotels do it. Airlines do it. Cruise lines do it. After they sell everything they can at regular or slightly discounted prices, they often find that they have a lot of empty rooms, seat, cabins. They know exactly what the cost of these spots are and they lose opportunity revenue if they do not sell them.
For example, if a cruise ship can break even on food, housekeeping, and wear-and-tear, by renting an interior cabin for $100, and they know that the additional liquor sales, excursions, and casino earnings will, on average, bring in $200 per cabin, they are happy to give bargain basement prices at the last minute to various travel agencies and discount travel sites. The catch? The shopper might not be able to go on a desired cruise if they risk waiting until the last minute, and the shopper only gets the left-overs.
This is the concept that can allow you get advertising for less than half the price. This applies to newspapers, magazines, radio, TV, and more.
Here’s the situation: Folks who sell advertising space for a living, make money off the commissions. They have to sell to get paid, and the publisher needs those sales to pay for the cost of publishing. The ad agent can’t always find enough buyers to fill the necessary slots. They can often make room, with a smile, if they have too many. But they get a little desperate when they are running thin because the publisher requires certain minimum levels to fund the production.
This is where your opportunity lies. You can offer to help fill these voids at a significant discount in the event the sales agent needs someone quick. If you know what the absolute minimum price that the publisher requires of the agent, you can make an offer around that level to fill the holes when the sales agent needs to meet their quota. The downside is that you won’t necessarily get to pick where it’s positioned, when it airs, or even if it gets selected to run at all (of course you won’t pay if it doesn’t run). Another downside is that you aren’t helping the sales agent make much money, but meeting quotas can help them keep their job.
Here are the steps to get this special pricing:
- First figure out where your target audience will be. What do they read, watch, and listen to? Those are the places you’d like your ad to exist.
- Contact the marketing sales agent for these media sources. Find out all the specifics about the ad options including the size/length, format, deadlines for submission, and who to send the submission to. Ask a lot of questions about the location/timing options, and how much control you get in selecting where the ad is positioned. Ask which positioning locations tend to do better and which do worse (e.g., the top right corner of the right page of a magazine is seen more often than any other location when the magazine is opened). Make notes, this is all important for later.
- Obtain the regular prices for each of their options (first page, back cover, various sizes, special issues, etc.) and the best pricing they can give you and if they ever run specials. It’s important that you clearly understand how their pricing model works and why sometimes they offer specials.
- If you are able to find out anything about how their commission works and if they have quotas, you will be in an excellent position for later. Some sales folks don’t mind sharing this while others realize it puts them in less control and won’t answer it. This information can sometimes be gathered by reviewing the details of their job postings on their website or by simply calling or emailing the manager of the advertising department and asking these questions. They are sometimes amazingly quick to share the details because they might assume you are thinking about applying for the position, but you might find them guarded. Be prepared to answer the question, “Why do you ask?” Saying that you’re a potential advertiser will likely get you no where but lying and saying you’re wanting to apply for the job is unethical. Possibly answering, “I’m curious how it works” or “I’m doing some research,” would be a reasonable next response but determine ahead of time at what point you are going to admit, “I’m considering advertising with you and I want to understand how your sales reps get paid.“
- Try to find out how often they are scrambling to find advertisers, or how often a prime ad location isn’t filled. This information will be golden to you.
- After researching multiple companies this way, you can then study your notes and figure out where you’d like to advertise, based on what your target audience would consume, and which of these targeted media sources might be the most desperate to give you a great deal.
- For each media source, figure out your budget and what you’re willing to pay for a horribly placed ad and for the prime location. Again, write everything down so you’ll be well-prepared for the upcoming phone call or email.
- Then contact your targeted advertising sales rep and you’ll pitch your offer to help them fill in missing advertisements when necessary, for a significant discount. FOR EXAMPLE, let’s say that you’ve determined that the publisher needs at least $150 per 1/4 page ad and splits the amount over this minimum as commission for the sales rep. You’re willing to pay up to $200 for a $500 1/4 page ad placement. You’ll create your own ad so the sales rep doesn’t have to hassle with paying for graphic work (which makes you an easier and less costly client to work with). After the warm-up conversation, your pitch might sound something like this: “I am not able to budget my advertising for the $500, 1/4 page ad that you quoted me. But I am willing to be placed on a back burner until you need to fill a 1/4 page hole and can’t find a full-priced advertiser, or if someone backs out at the last minute. I’ll do my own artwork and have an ad ready to go for that size and format, and I can afford $175/issue for this purpose.” Offering less than the $200 you decided you can afford gives you a little negotiating room if they counter offer.
Guess what? If you did your homework well enough, you might not have to wait too long for the sales rep to use you to start filling holes. You’re not as profitable as the other advertisers but you do fill a need. You are offering a win-win situation that can help the sales rep when necessary.