1. Session: Setting Long Term Goals Kirk Nelson, VP Public Radio Partners

2. The nicest thing about not planning is that failure comes as a complete surprise rather than being preceded by a period of worry and depression. John Harvey-Jones

3. Setting Long Term Goals Setting Long Term Goals 1. What’s long term? 2. Establishing long-term revenue projections 3. Creating an annual plan

4. What’s Long Term? Station philosophy Station philosophy Where are you are at?Where are you are at? Where are you going?Where are you going? Where station want’s to go?Where station want’s to go?

5. Long-Term Revenue Projections Where’s the money? Where’s the money? How do you project long-term revenue growth for department? How do you project long-term revenue growth for department?

6. Value of Inventory Broadcast Web Events E-Newsletter Challenge Grants Values in thousands

7. Project Long-Term Revenue Growth Converting broadcast ratings into revenue Converting broadcast ratings into revenue Conversion RatioConversion Ratio Market revenue projection Market revenue projection X stations P12+ AQH Share (4 book avg) = 1:1 ratio X stations P12+ AQH Share (4 book avg) = 1:1 ratio Station revenue ÷ 1:1 ratio = Conversion Ratio Station revenue ÷ 1:1 ratio = Conversion Ratio

8. Evaluating Station Product Potential Projecting revenue from current ratings Projecting revenue from current ratings Calculate 4-book avg Calculate 4-book avg Market revenue projection x P12 AQH Share x 50% Market revenue projection x P12 AQH Share x 50% 50% conversion represents the highest performing average 50% conversion represents the highest performing average

9. Conversion Ratio Graph

10. Evaluating Station Revenue Potential Conversion Variables Conversion Variables Higher averageHigher average NPR/News formats NPR/News formats Market dominance Market dominance Large sales staff Large sales staff Lower averageLower average Classical, Jazz and AAA formats Classical, Jazz and AAA formats Major market agency dependence Major market agency dependence

11. Market Revenue Resource Investing in Radio BIA Financial Investing in Radio BIA Financial J.C. Patrick NPR Station Development Manager 1.800.329.5380, ext. 2736 stations 281.494.6577 direct 281.494.6578 fax jcpatrick@npr.org J.C. Patrick NPR Station Development Manager 1.800.329.5380, ext. 2736 stations 281.494.6577 direct 281.494.6578 fax jcpatrick@npr.org

12. Revenue Levers Performance comes from Performance comes from PeoplePeople InventoryInventory SystemsSystems

13. Creating an Annual Plan Creating an Annual Plan Create Operating Plan Create Operating Plan Annual Business Plan for departmentAnnual Business Plan for department Focused, planned, deliberate & benchmarked Focused, planned, deliberate & benchmarked Communicates objectivesCommunicates objectives Sales Reps, GM, Development, Accounting, Traffic, Production Sales Reps, GM, Development, Accounting, Traffic, Production Helps you make adjustmentsHelps you make adjustments Monthly, Quarterly Monthly, Quarterly

14. Creating an Operating Plan Creating an Operating Plan Survey historical performance Survey historical performance Benchmarking revenue pacingBenchmarking revenue pacing By rep By rep By department By department Inventory snapshotInventory snapshot Three scenarios Three scenarios 100% at rate card100% at rate card At AUR & projected selloutAt AUR & projected sellout One for planning purposesOne for planning purposes

15. Benchmarking Revenue Pacing

16. Objective PRP Operating Plan Annual action planAnnual action plan Focus on those few thingsFocus on those few things People People Inventory Inventory Department Initiatives Department Initiatives Greatest resultsGreatest results Reviewed monthlyReviewed monthly Operationally automaticOperationally automatic

17. Getting Started Your City Market Operating Plan FY ____ Department Goal  Revenue:$  Growth:%  Revenue goal in dollars and percentage growth  (Attach Annual Budget Projection)

18. Two Steps to Projecting Revenue 1. Understand your inventory Scenario 1Scenario 1 Total available at rate card Total available at rate card Scenario 2Scenario 2 Inventory at average unit rate Inventory at average unit rate Or for planning purposes Or for planning purposes Scenario 3Scenario 3 Assumption usage/AUR prior year Assumption usage/AUR prior year Or use for planning purposes Or use for planning purposes

21. Two Steps to Projecting Revenue 1. Understand your inventory Total available at rate cardTotal available at rate card At average unit rateAt average unit rate Assumption usage/AUR prior yearAssumption usage/AUR prior year 2. Build your budget revenue By repBy rep By monthBy month QuarterQuarter Average weeklyAverage weekly Total growthTotal growth

22. Rep Growth Rates  First Year 100K – 150K  Year Two 250K  + 50 – 100 % prior year  Year Three + 25 – 50%  Year Four + 20%  Senior Rep +10%  AE Billing Performance  Research and benchmark yours

23. New Rep Growth Expectations $0 - 1,500Month 1 $2.5 - 5,000Month 2 $5 - 10,000 Month 3 $7.5 - 10,000 Month 4 $8 - 12,000Month 5 $8 - 12,000 Month 6 $10 - 15,000 Month 7 $10 - 15,000 Month 8 $10 - 15,000 Month 9 $12 - 20,000Month 10 $12 - 20,000 Month 11 $12 - 20,000 Month 12

24. Two Steps to Projecting Revenue 1. Understand your inventory Total available at rate cardTotal available at rate card At average unit rateAt average unit rate Assumption usage/AUR prior yearAssumption usage/AUR prior year 2. Build your budget revenue By repBy rep By monthBy month QuarterQuarter Average weeklyAverage weekly Total growthTotal growth

30. Plan Overview Few sentence overview of the market goal and initiatives to achieve your goal Include last year’s revenue Include last year’s revenue Incremental revenue to achieve goal Incremental revenue to achieve goal Summarize revenue impact of initiatives Summarize revenue impact of initiatives

31. Plan Overview - Example KKWW sales will be reaching a level of maturity with the current sales staff being in place for over 4 years and in its available inventory that will yield a 15.6% growth over 2004 fiscal year. We have two continuing initiatives in 2006 that will help us in meeting our goal including selling out our traffic sponsorships and continuing to increase our AUR against available inventory. New initiatives include a “large account” initiative, adding a fourth salesperson, and attaching a revenue stream to KKWW’s newly created New Media

32. Individual Salesperson Goals  List each salesperson’s revenue goal and growth percentage individually

33. Individual Salesperson Goals Example Johnny to grow 20% to 560,000 Johnny to grow 20% to 560,000 Paul to grow 15% to $483,000 Paul to grow 15% to $483,000 George to grow 35% to $395,500 George to grow 35% to $395,500 Ringo to grow 60% to $230,000 Ringo to grow 60% to $230,000 Pete to bill $95,000 in new revenue Pete to bill $95,000 in new revenue Brian (SM) to grow 10% to $200,000 Brian (SM) to grow 10% to $200,000

34. Initiatives and Action Plans  Please include the following for each initiative: Description of the initiativeDescription of the initiative Specific goalSpecific goal Key actions and corresponding dates to accomplish initiativeKey actions and corresponding dates to accomplish initiative

35. Initiatives and Action Plans  Please include the following for each initiative: Description of the initiativeDescription of the initiative Specific goalSpecific goal Key actions and corresponding dates to accomplish initiativeKey actions and corresponding dates to accomplish initiative Adding one new sales rep in order to insure revenue growth and to increased pressure on underwriting inventory

36. Initiatives and Action Plans  Please include the following for each initiative: Description of the initiativeDescription of the initiative Specific goalSpecific goal Key actions and corresponding dates to accomplish initiativeKey actions and corresponding dates to accomplish initiative New rep will add $95,000 in new business during the upcoming fiscal year and help increase pressure on station inventory to 84%

37. Initiatives and Action Plans  Please include the following for each initiative: Description of the initiativeDescription of the initiative Specific goalSpecific goal Key actions and corresponding dates to accomplish initiativeKey actions and corresponding dates to accomplish initiative Posting week of June 9 Interviews week of June 23 Finalists and referral calls week of June 30 Offer letter week of July 7 with two week start Average billing $5-10K by month three and $8- 12K by month six

38. Initiatives and Action Plans Description: Adding one new sales rep in order to insure revenue growth and to increased pressure on underwriting inventory Specific Goal: New rep will add $95,000 in new business during the upcoming fiscal year Key Actions and Corresponding Dates: Posting week of June 9 Interviews week of June 23 Finalists and referral calls week of June 30 Offer letter week of July 7 with two week start Average billing $5-10K by month three and $8-12K by month six

39. Monthly Department Update

40. 1-Year Operating Plan Now your department has a plan that’s: Focused Focused Planned Planned Deliberate Deliberate Benchmarked Benchmarked Measurable Measurable

41. One More Thought… 60 Minute Strategic Plan 60 Minute Strategic Plan 13 steps process for establishing long term goals13 steps process for establishing long term goals John E. Johnson John E. Johnson 530-758-0203530-758-0203 http://www.60msp.com/http://www.60msp.com/http://www.60msp.com/ Email: JohnE57@AOL.comEmail: JohnE57@AOL.com

42. Setting Long Term Goals Questions?

43. Says Thanks to its 2008 PRDMC Platinum Sponsors