We Play in Traffic

I just read an article about how a local media property is in a precarious cash position.  They’ve cut costs dramatically, but, as the article described, they still need to determine an “end-game” to boost revenue.

There’s no doubt this economy has wreaked havoc on local media.  The bastions of local media sales – cars, houses, and job postings – have all been hammered.  And dollars have moved to places like the Internet (which I will tell you is still a challenge for local advertisers no matter how much I advocate its use).

But the “end-game” might well, in fact, be retail sales.  Proven retail sales.  By putting their money where their mouth is via revenue sharing with advertisers.

The same local media property described in the article approached my firm recently with a really interesting idea: they would sponsor a sale for one of our clients with the redemption trackable back to that media vehicle.  For every sale where redemption was visibly due to the efforts of that media property, they would earn a percentage of the revenue associated with it.

They are willing to put up a fair amount of money to “prove” that their property really helps my client.

I did some quick math: if it works, it’s a win/win.  There’s enough margin in the incremental sales for my client to still make a decent profit per sale.  And if the math holds up on the projected sales through this event (the forecast is not outlandish), both the media property and the client will come out ahead.

But on a different basis than in the past – no “we pay the media and hope something happens.”

Pretty bold.  If it doesn’t work, the media property has “proven” that they cannot successfully impact sales.  They won’t get any more of my client’s dollars.  But if it does, we’d be dopes not to use them again.

Doing this is not for everybody.  There may not be enough revenue in shoelaces to have it pay out.  And you have to be willing and able to use some tracking mechanism (think coupon or code).  But the “end-game” for local media may be to act like its more trackable online bretheren.

Local media has been a tool for local advertisers for years.  Perhaps local advertisers have become more enamored of other, newer media recently.  But if local media “worked” just a few years ago, in some form, it likely still works today.  Maybe the local media just need to prove it.