Advertising Agencies · Demand Side Platform (DSP) · Digital Display · Media Buying · Media Planning · Online Media · Publishing · Real Time Bidding (RTB) · Remnant Monetization · TRAFFIQ

PLATFORM WARS #2: The Future of Display

The Future of Display Advertising will depend on Content, Data, Integration, and Control

It’s funny, but if you are around the display advertising business long enough—whether on the agency, publisher, or technology side—you tend to forget that the acronyms “DSP” and “RTB” didn’t even exist until recently. Now, we take for granted that we live in this “digital ecosystem,” surrounded by technology and data everywhere we look. But, what does the future of digital display look like?

** * Content: It is the content, stupid. Always has been and always will be. It’s why WebMD, WSJ, and TripAdvisor get $30 CPMs and everyone else gets $2. You want to buy audience? Why not buy it from the sites that have the right content to attract it? And, guess what? Those are the same consumers who have the “purchase intent” and you don’t need a million data-injected cookies to tell you that. The future of display advertising is bright for publishers that produce the kind of content that warrants high CPMs, and insist on valuing their content. I think that much of that content will inevitably be stored behind pay walls, creating two distinct Internets: the free, ad-supported one; and the paid one.

***  Data: The world is changing, and the data marketplace we know isn’t going to be very long-lived. Even if you believe (as I do) that cookies are fairly harmless and somewhat convenient (I would personally rather see relevant ads than not), you know the current situation must change. The Wall Street Journal’s recent “Data: What They Know” series simply stirred an already simmering pot a half-turn. The future is going to involve a great deal more transparency, and the ability for consumers to opt in and out of a cookie pool easily.

***  Integration: Tomorrow’s winners will also have to embrace open technology. Everybody knows the symbiotic relationship that display and search share. Why, then, is it so difficult to mate data from the two disciplines in a meaningful way for the average advertiser? Why is it so difficult to manage audience buying and guaranteed buying with the same tools? The future in display will offer advertisers the ability to easily discover, buy, and manage display buys—powered by insights that go beyond stale panel-based analytics. Imagine being able to model, in advance, how a display buy will perform alongside a complimentary search campaign, and then optimize both with the same tool? We are very close. Display is not going to be about display anymore.

***  Control: The future is a world where the publishers and advertisers wrest control back from the technology players. Why are agencies building their own DSPs? Because they are being disintermediated by technology players who know how to get the advertising performance that they don’t. Hell, if finding a bunch of quants and coders is what it takes to stay in the game, it’s only money, right? Holding companies have never been afraid to invest their clients’ money on the latest and greatest technologies and trends over the years. Why are publishers building their own platforms (i.e., Glam)? Because they getting $1 CPMs for their content, and exchanges are selling it for $8. All of that is going to end—badly. Over the next 2 years, the winning platforms will be those that offer both sides of the market transparency and control over buying and selling media.

So, all of this speculation is certainly very exciting. Then again, it’s the year 2010 and most agencies are still buying digital media by using fax machines and collating spreadsheets. What is very clear is that the current display advertising ecosystem is unsustainable. The wide array of technology players layered between advertiser and publisher is already shrinking, as companies consolidate or are absorbed, and the winners and losers are chosen. The conversation has been dominated by data lately—and that’s where it should be. Most of the display advertising out there is the kind of commoditized inventory that is worth only 75 cents, and data can play an important role in making even the worst inventory find a relevant audience. However, one of the reasons that companies like AdVerify are gaining so much steam, is the fact that an abundance of low-quality goods inevitably leads to a gray market.

The future of display will be one in which brand advertisers use technology tools to mix audience buying and guaranteed buying—informed by search (and other) data—in the same platform. Buying campaigns from reputable publishers will be painless and easy, and marketers will be able to make optimization decisions based on real data—both historical and forward-looking. Brand advertisers will buy premium audience segments through opted-in cookie pools from top-quality sites, and pay commensurate CPMs. Performance buyers will still be able to buy audience from networks and exchanges, but may settle for lower quality audience segments (cookie pools from publisher networks with lower quality content).

I am looking forward to the future.

[Published 10/6/10 in iMediaConnection]

Advertising Agencies · Demand Side Platform (DSP) · Digital Display · Media Buying · Media Planning · Online Media · Private Equity · Publishing · Real Time Bidding (RTB) · Remnant Monetization · TRAFFIQ · Uncategorized

PLATFORM WARS #1: Endangered Ecosystem?

Is the Current “Digital Advertising Ecosystem” Endangered by Overpopulation?

I am looking at an “ecosystem map” by LUMA Partners banker Terence Kawaja.*It is an 11×8.5 Pantone-hued logo vomit of incomprehensible names:  Blue Kai, AdXpose, Yieldex, AppNexus, Dataxu, TRAFFIQ (full disclosure: I work for the latter one, pronounced “Traffic”). From left to right, the landscape depicts the players in the business of digital display advertising, from those that buy the ads (agencies and marketers) to those that sell them (online publishers) and everyone in between. Over the last few years, not only have the players on either side increased but, thanks (or no thanks) to technology, the broad middle ground between the two has exploded.

Now, the advertiser can access a buying platform , buy on an exchange which uses cookie data to target an audience found on multiple websites, whose audience composition are verified by a third party, who are then served an ad by an ad server, with a creative that may be dynamic, and finally reconciled and billed by yet another software provider. And this is just the run of the mill stuff. Even in an industry rife with middlemen, the noise in the marketplace for the average media buyer is epic. What is happening out there, and why is it so confusing?

To the optimist, all of this wonderful technology is helping marketers buy the audience they have always wanted to target. Instead of having to buy ESPN.com at double-digit CPMs, now the advertiser seeking “sneaker intenders” can plug into a million cookie-appended sites and hit users with a dynamically generated running shoe ad that hits the reader as he is accessing jogging content on a favorite long-tail blog, and deliver him a geotargeted ad that shows him coupon on his size Asics from the nearest shoe store. And all for an $8 CPM. So what’s the problem?

For the publisher, the problem is that it’s way too cheap. After years of publishing all of their content for free, and placing a dozen network and exchange ad tags on their sites to monetize remnant inventory, the world is overwhelmed with banner inventory. Publishers—who sell only 30% of their total banner inventory on a good day—are stuck monetizing the large majority of their banners at an industry average $0.75. Yet, the networks and exchanges who have co-opted the publisher’s very audience via cookie data, are making a cozy $5 CPM selling “audience segments” and “behavioral targeting.” Ouch. You wonder when the (decent) publishers of the world will finally wake up and firewall all of that content they’ve paid a fortune to create and distribute.

In addition to the fact that publishers have been caught flatfooted by the broader trend of buying audience vs. buying the place where it is found, they haven’t really learned to leverage the tremendous power they wield: Owning some very nice eyeballs on one of the most important screens in the market today. Are television ad sellers dependant on several dozen third-party intermediaries who skim 90% of their revenue? No. The money that they have lost due to channel explosion, they have found other ways to make up: namely, monetizing their content through different distribution (DVD sales and rental, DVR rental, overseas distribution, and cable licensing).

The introduction of the iPad was another painful reminder of how poorly publishers are doing when it comes to content monetization. Essentially, they have allowed the ultimate 3rd party (Apple) monetize all of their mobile content for them, and they are left begging at Steve Job’s table for scraps. Oh wait—the “ultimate 3rd party” is actually Google, and they have already let them control their site traffic and much of their content monetization through search. Oops.

So, what is my point, anyway?

The point is about control, and who is exercising it in this increasingly complicated landscape. Looking at the publisher’s dilemma, it is clear that they have (for the time being) surrendered control to a variety of 3rd parties with technology expertise in the hopes of staying relevant in a digital advertising economy. In addition, today’s advertising agencies are increasingly becoming irrelevant, as they are increasingly dependent on the dozens of technology companies that control the way ads are created, displayed, measured, and transacted upon. The agency value proposition of publishers (we have the audience) and agencies (we know how to reach them) has eroded, which essentially opened the door to this new horde of technology players.

Yet, I am pretty sure both sides have only started to fight to get some of that control back. On the agency side, we have seen agencies building their own DSPs, so they can control the inventory and targeting capabilities. On the publisher side, smart companies like Glam are building their own ad platform (GlamAdapt) promising to “a 3rd generation ad platform built for emotional digital branding,” whatever that means. Both sides are trying to take control of the value they create by building platforms, which is admirable. But, in doing so, aren’t they building closed systems that, over time, will create their own ecosystems and be unable to quickly adapt to changes in the market? In other words, are they building Windows, rather than leveraging Linux?

This battle for control is going to see many of the ecosystem players in the middle get absorbed by the larger players on either side of the equation, and an explosion of platforms designed to make sense of the large array of choices and ultimately organize the ecosystem as a whole. The real battle will be among those companies that are building open, scalable platforms that enable both agencies and publishers to choose among the various moving parts, based on their need. In tomorrow’s platform, an agency will register, plug in what ad server they use (Atlas), their primary 3rd party data provider (Comscore), their existing publisher relationships, the different data companies they use (BlueKai, etc), and their billing system (Advantage)—and have a single interface to manage their search and display. Publishers will log into the same system and be able to participate in a marketplace where they set their own rates, and are able to leverage in-system data providers to create discrete audience segments and match them with advertiser needs. Tomorrow’s ad platform will also include both guaranteed buying (great for brands) and RTB buying (great for performance).

In the end, for such a system to exist, all players must start by ceding more control back to the buyers and sellers at the end, and the parties in the middle of the ecosystem must develop the APIs and integration paths that make systems interoperable. As a series, “Platform Wars” will look at all the different players in the space, and the ongoing battle for control as digital media technology evolves, and winners and losers are chosen.

*from his excellent May 3rd presentation at IAB’s Networks and Exchanges keynote address,  with the delightful title of “Parsing the Mayhem,” back when he was at GCA Savvian.
[This article originally appeared in iMedia Connection on 7/14/2010]

Advertising Agencies · Big Media · Demand Side Platform (DSP) · Digital Display · Online Media · Publishing · Real Time Bidding (RTB) · TRAFFIQ

The Next Printing Press

Today’s Magazine Publishers have to be Sales, Content, and Technology Organizations to Survive

By Chris O’Hara

 

I am sitting at the airport bar in Dallas, trying to get back to 2010. After attending the Dallas Ad League’s Magazine Day event at the Fairmont Hotel, I feel as though I journeyed to 1995 and back again. Not that I have anything against attractive, skirt-suited southwestern sales directors and their handsome, eminently polite male counterparts. Nor do I have contempt for the magazine industry in general, as many “new media” bloggers seem to. I came from a magazine background, and love magazines. But the atmosphere was decidedly 1999: folding tables stuffed with magazines, sharply dressed sales reps talking about “custom opportunities” and “special sections,” and not a computer display in sight. The lunch itself promised a lively panel discussion that would inform the 200+ attendees what the “digital future” of magazines would be, but the forum was a panel discussion, bookended by two gigantic monitors featuring a single, non-interactive PowerPoint title slide for most of the two hours.

A large portion of the day’s panel discussion was dedicated to the new, $90 million “magazines” campaign, designed to make advertisers feel better about spending money in their products (the “interactive” portion of the event featured the “magazines” video where Jann Wenner (the former editor and publisher of Rolling Stone) and Catherine Black (President of Hearst) get all feisty about audience engagement). Did you know that, during the 12-year lifespan of Google, magazine readership increased by 10%? Or, that “ad recall” has increased by 13% over the last five years? Neither did I, which is why this campaign is so important. Despite the bloodletting of the past several years, magazines remain a highly relevant part of the media landscape. “Magazines have enduring values for readers and advertisers that have gotten a little neglected and misunderstood in the era of Internet instant buzz and chatter,” said Jann Wenner, chairman, Wenner Media. “Magazines are beloved and powerful in people’s lives for very good reasons that need to be remembered and reinforced. That’s what this campaign is about.” Although, I am not sure how one can “misunderstand” a magazine, Wenner’s point is well taken.

The panelists (David Carey of Condé Nast, Michael Clinton of Hearst, and Stephanie George of Time) all did an admirable job of toeing the line. That being said, anytime you see those three so buddy-buddy on stage, you better watch out. Obviously, this new industry love-fest has a lot more to do with survival than pure affection. If their consortium can produce more than a print advertising campaign (irony alert! The best concept these guys could come up with to save their industry was a print ad campaign!), they might actually be dangerous.

The takeaway? These companies were training their employees for the digital age (“some are really adapting, and some are struggling with making the transition,” according to George). They are doing oodles of “custom media” for their advertisers—and even acting like agencies for many of their clients (something that I am sure the WPPs and Omnicoms of the world are enjoying), according to Clinton. And all of them are “building apps.” Lots and lots of apps.

Sounds good.

I wondered, however, when these guys all decided they didn’t want anything to do with the platform itself. The “power of the press” was always based on the fact that the average Joe didn’t have much of a voice, because he couldn’t afford a multi-million dollar printing press. Sure, he could shout from the rooftops and rabble-rouse in the local coffee shop, but that was basically it. The major publishers controlled the loudspeaker, and they could decide to what purpose they would drive their message (start a war, make scads of cash, anoint a president, etc.). Sure, print’s voice got diluted with the emergence of radio and television, but print journalism (the real stuff) still drove the message and shaped the conversation. Anyway, there is really no need to dig up this old conversation; we all know how the internet gave everyone their own printing press (blog), television station (YouTube account), and the means to capture “stories” as a “citizen journalist” (mobile phone).

When did the publishers decide to give up their platform? Why aren’t they leveraging everything they have to standardize the content creation business, and building the next great platform? It’s because they were focused on being sales organizations, rather than content organizations, or even technology organizations. At a certain point, a long time ago, things got mighty comfortable in publishing land. The industry that created the ability to print a trillion newspapers every night and get them into America’s driveways by 5AM, got fat and happy on loads of advertising money, and they started building immense sales organizations, and dedicated all of their creativity and emotion to increasing readership, ad pages, and revenue.  In the meantime, the very platform that they were building this organization on top of was thinning out, and starting to teeter, as disruptive technologies ate away at the foundations.

The magazine business is still a very powerful beast, though. Some 300,000,000 magazines were sold last year, and they generated $19.45 billion in advertising revenue, according to the Publishers Information Bureau. As our panelists pointed out, the average newsstand consumer still just about trips over themselves to shell out $4 to read the latest about Lady Gaga and poor, bamboozled Sandra Bullock, so magazines aren’t exactly dead yet. They still control some very powerful content, and they are starting to get themselves in a position to undo some of the damage they inflicted upon themselves (it should be noted that all of the panelists issued very refreshing mea culpas when it came to the ginormous mistake of making all of their online content free, and depending on banner advertising revenue to fill the gap. Needless to say, that gap only grew wider over the last 15 years, creating the monstrous chasm that exists today). To fill it, these magazine publishers are looking at the iPad as the greatest thing since the PDF replaced film in their production departments.

Early iterations of online magazine publishing “solutions” tried to bring the advertiser value by taking that PDF and putting in online, where readers could see full-page ads, and enjoy the beautiful layouts that make print so special. Later iterations—featuring in-page video, ad “hotspots” with enhanced product information, and other interactive features—also failed, due to the nature of the engagement. When a reader goes to the web, he is often looking for “quick bites” of content, not necessarily the longer, more relaxed, engagements that he ordinarily sets aside for a magazine reading session. The iPad and other smart mobile devices promise a reader that wants an interactive experience, but is more engaged and willing to spend time with content. Maybe he is being held captive by a plane, train, car ride, or (dare I say it) boring business luncheon. The iPad user expects interactivity, and something more than just printed content, and he is willing to pay for it.

The last part of that sentence is really what today’s Ad League Luncheon was really all about. Magazines are the king of the opt-in relationship. People pay good money to get magazine subscriptions, and advertisers know that they are reaching people who are truly engaged with that content. That’s the only kind of validation that’s truly important, and it’s so much more reassuring to an advertiser than a Quantcast or ComScore data pull. People have limited time, and limited money. As an advertiser, I know that I will at least have a chance to “have a conversation” with the reader that has plunked down his hard-earned money to spend some quality time with the content my ad is alongside. That translates to the web, when I start being able to charge for subscriptions—and ultimately lifts CPMs (called WSJ.com lately)? And it translates to high CPMs for whatever advertising we will start to find on iPads and other mobile devices where consumers are willing to pay for applications.

For today’s print publishers to truly recapture the ongoing attention of the modern advertiser, and stay relevant in the post-print era of modern advertising, the prescription is obvious, although difficult:

Make it Exclusive: What sets the price for any product is its supply vs. its demand, whether it’s coffee, hotel rooms, or content. New York City Mayor and media tycoon Michael Bloomberg didn’t get rich because he had the best content. He got rich because he has access to proprietary content that no one else had. The successful content organization has to be able to have the research, stories, and data that no one else has—or present that content in a format that nobody else can match. Whether you are the National Enquirer buying off Perkins’ waitresses to get the Tiger Woods scoop, or you are a B2B publisher with a trade magazine that rounds up the day’s prices for pork bellies on the Chicago Mercantile Exchange, you have to lead with content that people can’t find anywhere else easily. The nature of the content always defines the value of the audience, and content companies always win when they can charge enough to break even on the content production, and make the advertising the gravy on top.

 

Make it Expensive: It’s funny how people will plunk down good money for a magazine subscription, but hesitate to pay even a few dollars a month for that same content online. A magazine is an object of beauty, with some heft, and (depending on the title), conveying a certain image. Like it or not, reading the New Yorker in an airport lounge says something about you—just as digging into an issue of ESPN Magazine, or the Economist. Magazines are consumer products, and sold like them, their covers designed to spur us to pay a good amount of money to grab them off the shelf. If I am an advertiser, shouldn’t I expect a reader to be willing to pay $30 a year for all the content you produce? Shouldn’t I demand evidence that your publication is more valuable than the thousands of other free content sources available in your vertical? I think some magazine publishers are finding out that their content isn’t quite as valuable or differentiated as they would like to think. Maybe, after underpaying writers, editors, designers, and developers for decades on end, the reason many hot content producers set off on their own is because they see the opportunity to get paid higher prices for their content (or at least, be able to own it outright). The modern magazine publisher has to get back to producing exclusive, expensive content that readers are willing to pay a premium for.

Make it Interactive: About 4 years ago, I was working for Nielsen and getting pitched by a highly progressive interactive company that was taking magazine reading to the next, interactive level. They had an online magazine that blended social media, video, in-page advertising, and a great package of analytics to tie it all together. You could literally look at a typical magazine fashion shoot, mouse over the various products within the photo, and get instant product information, pricing, and find out where to buy the object(s) of desire. Now, add in location-based marketing with mobile devices, and you have a whole new, highly relevant type of interactivity that today’s publisher can leverage. The fact that most magazine websites are still HTML-based and feature standard banner units speaks volumes. The problem wasn’t the concept or pricing of some of the great online magazine ideas. The problem was that AOL (and other online players) defined the platform before the best content producers could. The magazine industry came up with the 468×60 banner (Hotwired.com), but AT&T had to buy into it to create the standard. Now, it seems as though the advertisers have more say in the process of establishing advertising standards than the publishers. Chris Schembri, VP of Media Services from AT&T (the sole advertiser on the panel) made it clear that marketers were looking for leadership from their publishing partners around creating the digital content standards of tomorrow. Advertisers like Schembri need their publishing partners to create new standards that leverage technology to make their advertising more relevant to today’s audiences. Publishers cannot let their advertisers (or online portals, platforms, and ad networks) tell them what they can sell.

Own the Platform: The biggest challenge facing today’s magazine and newspaper publishers is getting back control over the interactive delivery platform itself. Look how the music industry lost control of their delivery system, and the billions of dollars in lost revenue that engendered. Once technology made it possible to remove a song from a CD and share it with hundreds of people for free, the music industry was sunk. Like publishers today, they found themselves looking to Apple to build a modern platform that would once again value their content. They are finding a rough peace with the 99 cents a song deal they got from Steve Jobs. If the iPads, Kindles, and Sony Readers of the world end up creating the standard for published content, the content owners will have once again been commoditized by technology players and lack control of their own destiny. Publishers need to think about designing the next printing press, rather than have Apple do it for them.

All of this hyperbole aside, I don’t think magazine publishers will ever go away. Over the years, printed magazines, newspapers, and books will be a great luxury. People who would rather read a solid copy of Moby Dick, or fold the Wall Street Journal on the train, or flip through Architectural Digest will be afforded the opportunity to do so—at a premium price. The future for these content manufacturers, however, will be around taking back ownership of the delivery mechanism and setting the standards of tomorrow when it comes to content creation, distribution, measurement, and (most importantly) ad formatting and delivery.

That’s a panel discussion I believe would be worth listing to.

[This article originally appeared as a two-part feature in Adotas from 7/13/2010 and 7/14/2010]

Publishing · Sales · Sales Management · Sales Rants · Sales Tactics

Sales Rants: The Pretty Proposal

An undercover magazine ad exec reveals what it takes to get that all-important commission and quarterly bonus

Lonny Rosenblatt*
I am staring across the table at Lonny, who is negotiating a side order of asparagus to go with his branzino. We are in an expensive Italian restaurant located across the street from a strip mall out on Long Island, and this is the bi-annual trek from the city to sit at the knee of the master and suck in his wisdom. In the Industry, Lonny used to be top boy. Now, sitting somewhat slumped over his fish, his slightly dated tie threatening to flop into his bread plate, Lonny is bemoaning the Industry’s fate.

Lonny sells to retailers, and the retail trade is dying. Best Buy. Circuit City. Wal-Mart. There are hardly any old-line retailers left to sell to. Lonny used to be our fifth-largest print advertiser, and now he’s pulling a 6-time schedule of black-and-white half-pages instead of the glory days, when the product line was fat and Lonny presided over a budget that allowed for dozens of 4-color pages a year.

My job, along with that of my colleague—an amiable sales director named Rod—is to ask Lonny questions that we already know the answers to, while looking captivated as Lonny dispenses Industry Knowledge. After all, Lonny is our 15th-biggest customer, and despite the ailing condition of the business, he’s one of the few advertisers willing to throw down a complete schedule at the beginning of the year. That makes our lives easier, and if the price of his guaranteed schedule is to check up on him over a $300 Italian meal in the depths of Long Island, then that’s what we have to do.

The sick part of it is: I love doing this. I have been looking forward to seeing Lonny since Monday and as I tuck into another piece of veal, I inquisitively meet Lonny’s eyes as he continues lamenting the State of the Industry, all while wondering whether it’d be appropriate to get another glass of that Chianti.

**

Nice Sale
I just hung up the phone with Big Imaging Company and negotiated a deal that still has me grinning well into the fourth Excel tab of our company’s absurd boilerplate insertion order. Jim has some ambitious plans for 3Q, and as #1 Industry Mag, we have a lot to sell. As part of a multinational publishing company, we are obligated to “straddle media” and “deliver the gateway.” What that means is that nobody’s buying print advertising anymore, so you have to work three times as hard selling banner ads, custom publications, Webcasts, and face-to-face marketing opportunities just to make the same amount of money you’d otherwise be raking in with print.

Jim, my contact, has just agreed to spend a dollar amount equivalent to 20 percent of our annual display advertising budget to push a special marketing initiative. And even though our rates are just a premium-positioning charge compared to the national consumer press, I shudder with glee as I tab in an extra zero on the order’s net sales field. Naturally, my first instinct is to compose a self-congratulatory “send all” email outlining my monster sale.

I decide against it. The sale I just made will serve to double the work of the heinously underpaid custom media department which, unlike me, will never see a nickel of the sale I just closed. Instead, I write a 1,200-word “we-mail” outlining all the work they need to do for the program, and close my door to call Jan.

**

Jan
It’s 11 A.M. and Jan, my wife, is yammering into my ear. I’m typing furiously, the phone wedged between my shoulder and my ear, trying to provide some guidance on Big Imaging Company’s Web development project. I hear something about the roof (leaking?) amid background noise comprised of my 4-year old daughter crying, my 6-year old son explaining (“I didn’t do it”), and the shrill barking of my 11-year old dog, Nudgy. As Jan hits me with some more information (bring something home for dinner?), my other 11-year old dog Scout joins the high-decibel chorus. The house sounds like it has been invaded by a paramilitary organization run by the ASPCA.

It always amazes me that we can spend a couple of dollars on color printer ink, take a few hours to put together some sheets of paper, and then put a price tag of $100,000 on it.

I keep typing, retaining virtually nothing of our “conversation.” Line two rings through with a 202 area code. It’s Big Washington Media Partner. I tell Jan I have to take the call, and I’ll get back to her in five minutes. I wind up calling her from the train seven hours later, on the ride back home. “Did you ask me to bring something home to eat?”

There are loud noises in my ear again; I think Jan’s yelling at me.

**

The Miracle of Design
As Associate Publisher of No. 1 Industry Mag, it’s my job to organize the sales team and drum up new business. We publish about 24 print magazines a year, run about 10 Web sites, own a few e-commerce businesses and have a big trade show. We sell about $10,000,000 worth of stuff a year, and most of it comes in dribs and drabs of under $5,000. We have eight salespeople who try to make that happen. Orders are the lifeblood of our business and, like car accident victims, our only chance of survival is to be constantly transfused with a steady stream of our lifeblood: hard American currency, collected diligently every thirty days.

A good deal of our lifeblood is gathered in large amounts. These are the big sales, ranging from anywhere between $50,000 and $200,000. In other words, they’re the sales that need the pretty proposal. We do that better than anyone in the business.

What is the pretty proposal? It’s taking the contents of an email proposal and having someone absurdly talented turn that proposal into an ad-quality PDF—complete with logos, pictures, and neatly-set text, preferably in a sans-serif font. It comes in full color, and may or may not be submitted via PowerPoint presentation, which basically says the same thing, but with even more images.

We sell ideas, and those ideas have to look good. It always amazes me that we can spend a couple of dollars on color printer ink, take a few hours to put together some sheets of paper, and then put a price tag of $100,000 on it. Initial investment? Zero. The problems only start when someone actually takes us up on it.

[This post originally appeared in MediaBistro, 5/31/2006]