Web Presents Telemarketing Opportunity for Radio Stations

In one example of how the Internet can create, rather than siphon, telemarketing opportunities, a Virginia marketing firm has found success in showing radio stations how to sell Web advertising – over the phone.

Radio Profits Corp.’s in-station telemarketing program, first tested in early May by Capstar Broadcasting Group, Omaha, NE, brought the radio company $10,530 in its first six days of sales, said Donn Seidholz, Capstar Broadcasting’s vice president and general manager.

The program, for which the broadcasting company hired it’s own in-house telemarketer – selected with input from Radio Profits, has been so successful that the company plans to hire one or two more telemarketers for the program in the near future. The company has been bringing in about $1,000 to $1,500 a day in new advertising revenue, said Seidholz.

“This is all newfound money for us, and with very attractive margins,” he said.

Since its formation in 1992, Radio Profits Corp., Newport News, VA, has provided radio stations with turnkey telemarketing programs to help them sell smaller advertising packages than stations would normally sell through their in-person sales staffs. The company, which had been using devices such as public service announcement sponsorships to help stations lure businesses that had never before advertised, has used a similar approach to bring businesses to the Web.

“It’s very similar to the radio in that it’s virtually free to users, and it’s paid for by advertisers,” said Scott Wolf, vice president of marketing for Radio Profits. “There are many companies that have been created to help develop Web content. The challenge is in selling.”

The cost to radio stations is the same for the radio and Web programs. Radio Profits charges a percentage of ad revenue generated by the program. It also charges a $500 retainer, which it keeps if a station quits the program before Radio Profits’ percentage fee reaches $500.

Capstar radio station KGOR in Omaha, for example, has run campaigns on stopping school violence and about tornado watches. On the station’s home page, there is a button that reads Stop School Violence. Visitors who click on the button are connected to a page that contains a message about school violence and links to agencies and organizations that can provide more information or assistance. Logos of companies that sponsored the page are displayed on the bottom, with some logos containing hyperlinks to the sponsor’s home page.

Much like it’s program for helping companies sell radio time, Radio Profits provides stations with a full package that helps the station hire a telemarketer, train the telemarketer through conversations with Radio Profits and with other telemarketers hired by other Radio Profits clients, assistance with script writing and help creating campaigns. The company also provides radio stations with a database of businesses in the area for the telemarketer to contact about advertising.

The database of potential advertisers, similar to the databases Radio Profits creates for clients who use its radio telemarketing system, generally contains names and contacts of businesses not already advertising on-air with the radio station.

“It’s designed to get businesses spending money that aren’t already spending money,” Wolf said. “The process of developing new accounts is very different from serving existing ones. This is a completely new medium and the challenge is to develop a critical mass of advertisers on the Web site.”

The turnkey nature of the program was one of the biggest attractions, according to Seidholz.

“They give you everything from start to finishing including helping you find the sales person, ongoing training, a prospect database, consulting – everything from A to Z,” he said. “They are providing the business-side venture with our available resources.”

The costs of the Web packages radio stations sell, often $300 to $500, are slightly higher than the costs of the cause-related radio sponsorship packages that Radio Profits has created for past clients. That is in part because often Web ads are sold in connection with a mention on the radio.

“They sell joint online and radio packages in which the radio announcers might say something like ‘go to our Web site to find information on stopping school violence sponsored by these businesses,'” Wolf said.

Those type of announcement might also be responsible for a sharp rise in radio sponsorships that the radio station has seen since it began the advertising marketing program. The increased hits have given the station increased chances to sell its own product on its site.

In an expansion of the program, KGOR is also planning to launch a classified page on its Web site that can serve as an extra space for local businesses to advertise, and an extra resource for radio listeners about businesses in the area.

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