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Question about direct buy... (18)
03-01-2013 04:46 PM
#1
rclair45 (Member)
Question about direct buy...
Hey guys - Quick question about negotiating a direct buy on a site I've been doing placements on through SiteScout. On SiteScout, I've been paying around $.88 CPM for a placement on this particular site.
When I talk to the ad rep to do a direct buy on the site, I'm being quoted at $2.25 CPM for the same placement that I'm getting through SiteScout. Does that make any sense that I'm quoted for so much more? If I understand correctly, the remnant inventory through SiteScout should be less than buying premium inventory on the site. What I'm not getting is why there is such a difference in price between the $.88 CPM through SiteScout and $2.25 CPM direct. If anyone can explain why the publisher might have such a big difference in CPM cost and also has any thoughts on whether I should continue advertising through SiteScout or buy direct, I'd really appreciate it.
03-01-2013 10:24 PM
#2
nickster (Member)
Test direct. Sometimes the first impressions convert that much better that you can pay a lot more and still make more money. If it doesn't back out for you then just try to negotiate down to a level that works for you and them.
03-03-2013 12:53 AM
#3
rclair45 (Member)
Thanks, that makes sense. If anyone else has thoughts, feel free to chime in.
03-03-2013 01:14 AM
#4
mattaw ()
With SiteScout you may not be getting shown as the first impression to the visitor or may just be getting sold what the website can't sell itself (remnant inventory). Why don't you try doing a 2 stage deal, one at the higher price (sometimes premium far outperforms remnant inventory) and one for that same remnant and see if you can't get it at a bit cheaper of a price... Just specify what you want.
03-03-2013 03:15 PM
#5
rclair45 (Member)
Originally Posted by
mattaw
With SiteScout you may not be getting shown as the first impression to the visitor or may just be getting sold what the website can't sell itself (remnant inventory). Why don't you try doing a 2 stage deal, one at the higher price (sometimes premium far outperforms remnant inventory) and one for that same remnant and see if you can't get it at a bit cheaper of a price... Just specify what you want.
Thanks man. That sounds like a good plan. What's interesting is the ad rep would barely budge on price. Only willing to go down to $2.25, which doesn't make sense because if they are selling the remnant inventory to me for $.88 and I offered them anything greater than $.88, is it logical to think that they would have no problem taking it?
03-03-2013 03:25 PM
#6
nickster (Member)
Originally Posted by
rclair45
Thanks man. That sounds like a good plan. What's interesting is the ad rep would barely budge on price. Only willing to go down to $2.25, which doesn't make sense because if they are selling the remnant inventory to me for $.88 and I offered them anything greater than $.88, is it logical to think that they would have no problem taking it?
Yes but you're now buying premium inventory which has a completely different mindset.
03-04-2013 05:14 AM
#7
rclair45 (Member)
Originally Posted by
nickster
Yes but you're now buying premium inventory which has a completely different mindset.
Did some research and I see what you mean. Thanks.
03-07-2013 09:31 AM
#8
supernova (Member)
You can ask for their remnant inventory rate too.
03-07-2013 08:07 PM
#9
rclair45 (Member)
I was thinking the same thing and asked them that. They wouldn't budge on the rate, despite the fact that I've been buying a ton of impressions per day on SiteScout. If my eCPM is about $1.40 and they want $2.25 CPM for the premium inventory, is it worth it to test direct? I know that have the first impressions rather than the last will help, but I'm wondering if there is too big of a difference between the eCPM and the CPM to try? I know the only way to really know is to test, but figured I'd ask if anyone has had a similar experience before dropping a significant amount of money (for me at least) into a direct buy just yet.
03-08-2013 03:10 AM
#10
mattaw ()
Premium vs remnant is different. Everyone will always budge - just have to phrase things right. Have you explained you're buying their remnant for say 80 cents 
Max
03-08-2013 05:40 AM
#11
rclair45 (Member)
Gotcha. Didn't know if I should say that I was getting it for 80 cents, but that makes sense. Thanks for letting me know.
03-08-2013 07:37 PM
#12
mattaw ()
I would lowball it - that way if they say we'll match it....
03-08-2013 10:39 PM
#13
rclair45 (Member)
Originally Posted by
mattaw
I would lowball it - that way if they say we'll match it....
Ok cool, thanks.
03-09-2013 03:44 AM
#14
fourchars (Member)
Dealing with pub sales teams for media buys is an art in and of itself. There are a number of reasons that may come into play on why they did not budge on price.
1. They are a lazy 9-5 employee, the rate card says 2.25 so that's what they are gonna tell you.
2. You come across as someone that is not going to spend enough money long term. They have no desire to set up a small test for you at a good price so you can leave after.
3. Maintaining a certain rate is very important for publishers. Plenty sell inventory for $15 CPMs to retarded agencies while selling the same impressions for $.75 else where. The inventory they have follows the 80/20 rule usually. They get 80% of revenue from selling 20% of the inventory. Some of this has to do with quality but it has quite a bit to do with agencies just plain paying to much.
This is not to say all agencies are stupid because of this. They sometimes even know they are paying to much and do not care as long as the client is happy. They often work on a transparent agency fee to some extent so they cannot buy cheaper and mark it up more.
4. Many other minor factors that could be written about for days.
Many people write and talk about direct buys but have obviously never done them. You can always tell when they skim over the actual part about contacting the site and setting up the buy like that's the easy part of the entire process. These people just figure that because they have never done it and are talking out of their ass.
There are a bunch of things you can do to get over this, here are a few:
1. You have to seem like you come from a large agency. If you are a 1 man operation sure as hell do not contact them with "CEO" or "President" in your email sig - it makes you look like a joke to them. Humble yourself a bit and give yourself the title "Media Buyer" and front that you are part of a larger agency as an employee.
2. Bribe them - $20 gifts go a long way with working with a 9-5 employee.
3. Do not ask for "test buys" come in with a HUGE IO amount. If it's a big site I'm talking 7 figures or more. Sales reps will get a huge hard on for an IO that size regardless of the small print terms. You can cover your ass completely by having with the small print saying the daily impressions are capped per your direction. You do not even need to have an out clause if you phrase that single part correctly. Just tell them you want "0" impressions a day and that's all they can charge you for if that's how the IO is written. This tactic is pretty damn good at getting some insanely cheap rates.
The key tip here is keep away from phrases like "test buy" - no rep is gonna want to go below the rate card on just a test buy. You can write an IO with a large dollar amount that is still a "test buy" if the small print is done right.
03-09-2013 04:50 AM
#15
tical (Member)
^ i like this guy
03-13-2013 12:07 AM
#16
rclair45 (Member)
Originally Posted by
fourchars
Dealing with pub sales teams for media buys is an art in and of itself. There are a number of reasons that may come into play on why they did not budge on price.
1. They are a lazy 9-5 employee, the rate card says 2.25 so that's what they are gonna tell you.
2. You come across as someone that is not going to spend enough money long term. They have no desire to set up a small test for you at a good price so you can leave after.
3. Maintaining a certain rate is very important for publishers. Plenty sell inventory for $15 CPMs to retarded agencies while selling the same impressions for $.75 else where. The inventory they have follows the 80/20 rule usually. They get 80% of revenue from selling 20% of the inventory. Some of this has to do with quality but it has quite a bit to do with agencies just plain paying to much.
This is not to say all agencies are stupid because of this. They sometimes even know they are paying to much and do not care as long as the client is happy. They often work on a transparent agency fee to some extent so they cannot buy cheaper and mark it up more.
4. Many other minor factors that could be written about for days.
Many people write and talk about direct buys but have obviously never done them. You can always tell when they skim over the actual part about contacting the site and setting up the buy like that's the easy part of the entire process. These people just figure that because they have never done it and are talking out of their ass.
There are a bunch of things you can do to get over this, here are a few:
1. You have to seem like you come from a large agency. If you are a 1 man operation sure as hell do not contact them with "CEO" or "President" in your email sig - it makes you look like a joke to them. Humble yourself a bit and give yourself the title "Media Buyer" and front that you are part of a larger agency as an employee.
2. Bribe them - $20 gifts go a long way with working with a 9-5 employee.
3. Do not ask for "test buys" come in with a HUGE IO amount. If it's a big site I'm talking 7 figures or more. Sales reps will get a huge hard on for an IO that size regardless of the small print terms. You can cover your ass completely by having with the small print saying the daily impressions are capped per your direction. You do not even need to have an out clause if you phrase that single part correctly. Just tell them you want "0" impressions a day and that's all they can charge you for if that's how the IO is written. This tactic is pretty damn good at getting some insanely cheap rates.
The key tip here is keep away from phrases like "test buy" - no rep is gonna want to go below the rate card on just a test buy. You can write an IO with a large dollar amount that is still a "test buy" if the small print is done right.
This is a phenomenal post. I really appreciate your input. I've already implemented this advice with direct buys since I've read it. Thank you so much.
03-13-2013 12:43 PM
#17
caleb (Senior Member)
Originally Posted by
tical
^ i like this guy
agreed
03-13-2013 03:39 PM
#18
mattaw ()
Originally Posted by
fourchars
Dealing with pub sales teams for media buys is an art in and of itself. There are a number of reasons that may come into play on why they did not budge on price.
1. They are a lazy 9-5 employee, the rate card says 2.25 so that's what they are gonna tell you.
2. You come across as someone that is not going to spend enough money long term. They have no desire to set up a small test for you at a good price so you can leave after.
3. Maintaining a certain rate is very important for publishers. Plenty sell inventory for $15 CPMs to retarded agencies while selling the same impressions for $.75 else where. The inventory they have follows the 80/20 rule usually. They get 80% of revenue from selling 20% of the inventory. Some of this has to do with quality but it has quite a bit to do with agencies just plain paying to much.
This is not to say all agencies are stupid because of this. They sometimes even know they are paying to much and do not care as long as the client is happy. They often work on a transparent agency fee to some extent so they cannot buy cheaper and mark it up more.
4. Many other minor factors that could be written about for days.
Many people write and talk about direct buys but have obviously never done them. You can always tell when they skim over the actual part about contacting the site and setting up the buy like that's the easy part of the entire process. These people just figure that because they have never done it and are talking out of their ass.
There are a bunch of things you can do to get over this, here are a few:
1. You have to seem like you come from a large agency. If you are a 1 man operation sure as hell do not contact them with "CEO" or "President" in your email sig - it makes you look like a joke to them. Humble yourself a bit and give yourself the title "Media Buyer" and front that you are part of a larger agency as an employee.
2. Bribe them - $20 gifts go a long way with working with a 9-5 employee.
3. Do not ask for "test buys" come in with a HUGE IO amount. If it's a big site I'm talking 7 figures or more. Sales reps will get a huge hard on for an IO that size regardless of the small print terms. You can cover your ass completely by having with the small print saying the daily impressions are capped per your direction. You do not even need to have an out clause if you phrase that single part correctly. Just tell them you want "0" impressions a day and that's all they can charge you for if that's how the IO is written. This tactic is pretty damn good at getting some insanely cheap rates.
The key tip here is keep away from phrases like "test buy" - no rep is gonna want to go below the rate card on just a test buy. You can write an IO with a large dollar amount that is still a "test buy" if the small print is done right.
Fantastic advice. There are a ton of other factors that go into rates as well, such as dumping budget at the end of a quarter to meet budget and make margin (you'll see rates go up and remnant down towards the end of a quarter).
Sometimes overpaying is about exposure on the right type of website, they may pay an arm and a leg, but if Tide shows up on MSNBC they are happy (as you alluded to)
Your contact there is valuable, a rep is often commissioned, so they want to make the sale, but have structure - your IO tip is golden here, ever seen a car salesman when you come in and want a expensive car.. drooling
NEVER say you are an affiliate when you go do large IOs, as stated, you run a performance agency (you all really do). Agency =/= affiliate, and looks a lot better.
At the end of the day it all comes down to your relationship. Think about how you'd build any other business relationship, you have to do the same here. I can tell you that personally some of my reps and I talked every day for my larger buys. Not necessarily about business, but just about whatever, it's about maintaining a good relationship.
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