Senior Director, Regional Ad Sales Operations
OnMedia, Des Moines, Iowa
Few people in the cable ad sales business are better suited to talk about client longevity than industry veteran Montgomery, who began working the Des Moines market in the mid-1980s and has overseen sales operations for 10 years – most recently for owner Mediacom Communications Corp. and its ad sales unit OnMedia. For Montgomery, the key to retaining business and reducing client churn starts – and stops – with people.
Based on your industry experience, what’s a typical annual client churn level in local cable advertising?
I’d say on average 25 to 50%. It depends on the list, and on the tenure of the AE working the list – a newer AE is probably going to have more churn, and if they’re working more of a national/regional list, you’re going to have more churn because it’s tougher to have personal relationships with those clients. If they decide they’re not doing TV, they’re not doing TV. There’s not much you can do about it.
Why does client churn matter in the first place?
Obviously it’s the same song we’d sing to our potential clients: It’s easier to keep your current clients and grow them than to come up with new clients. The nature of our business is such that you’re going to have to do a little bit of both. But churn also tells you an awful lot about your performance, and about what clients think of your product and what they think of your people.
What’s a Bob Montgomery-approved key to success here?
In my view if there’s one single key to account retention, it’s your staff, and your ability to retain staff. Because clients often tend to see that new ‘AE of the month’ especially in radio where they tend to have a higher churn rate. And from a client perspective, that makes it difficult to have a relationship with your company. And it puts some doubt in their mind about the product: ‘Why do I keep getting a new AE every six months?’
So in an industry that’s captivated by interactive TV and new ratings systems, you’re telling us it’s really about the human factor?
Look, people trust people. And if they’ve been working with the same guy or gal for four or five or six years and developed some relationship and trust, and they’ve done some things that have worked, it just makes it more comfortable for them and easier for us as well to keep them on the air and to do business with us. So create a work environment where they’re not looking to leave, and clients feed off that.
We also give incentives to long term clients. We reward them with renewals and give clients a little bit of a monetary reason to keep doing business with us. But at the end of the day it still comes down to how we treated them, and what the relationship is.
--Interviewed by Stewart Schley