Outsourcing: Its NOT About Headcount Presented by Jim Taszarek, President Public Radio Partners

Outsourced Underwriting Is it right for you? Reasons stations have outsourced Considerations in decision How it works Elements of an agreement

Outsourced Underwriting Defined Complete responsibility for underwriting Accountable for achieving station goals Local sales staff representing station Managed and employed by PRP Revenue from marketing, advertising and community relations budgets

Stations PRP Represents Phoenix Seattle Nashville AustinLas Vegas

PRP Employees Principals –Kirk Nelson –Jim Taszarek 25 Employees Combined, over 200 years of: –marketing experience –sales experience –corporate support experience

PRP Vision Attract the best people who together create the standard of excellence for corporate support in Public Radio

PRP Mission Link stations and corporate supporters in a mutually beneficial relationship that enables the station to better serve the community and helps the underwriter grow their business

PRP Philosophy Public Broadcasting’s –Quality Programming – Non-commercial nature Are what the audience and underwriters value Respect and protect that nature in order to make underwriting a significant and sustainable revenue source

Track Record of Sales Growth Year % Year % Year % Year % Year % Aggregate billing performance for each year in a market

Reasons Stations have Outsourced Greater revenue Accelerated department performance Create stability Professional sales management Improved relationship with sales team Improved department performance without need to focus on underwriting Transfer risk of growth

Station Benefits Beyond Expectations Morale improved beyond expectations Growth was higher than expected More conservative on copy guidelines than expected Transition to outsourced organization easier than expected Less HR to manage Brings new ideas in from other markets Working with folks who "get it"

Considerations In Your Decision Revenue Performance People – Investment in People People – Talent of Underwriting Team Inventory

Revenue Performance How does the station’s underwriting performance compare to: Industry Market Station needs

Investment in People New rep guarantees The Big Risk – high hidden cost of turnover The cost of staff turnover in underwriting –New rep minimum $20,000 –Experienced rep – attrition in accounts could be more

Talent of the Underwriting Team Does the Underwriting Manager have experience and track record of underwriting management success? –Recruiting –Managing salespeople –Inventory management –Team revenue growth If not, can I hire a person with this experience?

Inventory Your second greatest resource in underwriting is: –Inventory Radio and television, being intangible mediums, requires expertise in proper yield management

Yield Management Price forecasting process –Maximize revenue and yield from inventory –Provide predictive strategic information Goal –Max number of customers –Max price levels

Considerations In Your Decision Revenue Performance People – Investment in People People – Talent of Underwriting Team Inventory

How It Works Alignment PRP approach

Integration of Underwriting Dept. Goal: Build trust and understanding –Programming »Inventory »Copy »News –Business »Traffic system utilization »Collections process –Development »Joint effort »Leads generation

PRP Systems and Tools Process Sales Sales Management Recruiting New Hire Start Plan Tools Training Intranet Sales Database Underwriter Appreciation Program

Elements of an Outsourced Agreement Exclusive agent for all local and national underwriting Clearly defined underwriting inventory Outsourced organization provides –Underwriting sales manager and staff Station provides –Ratings and Qualitative data –Traffic and billing functions

Elements of an Outsourced Agreement Commission only - paid on billing Agreed upon annual billing budgets Special promotions Station approves underwriting copy Indemnification 5 year agreement Spirit of the agreement

Questions?