NAB reports (Jan-Dec 1937)

Hale Bondurant of WHO, Des Moines, Iowa, as chairman of the committee, then presented the recommendations for standardization of units of sale and frequency or quantity discounts. After an ex¬ tended discussion, the following recommendations were adopted and referred to Chairman H. K. Carpenter of the Commercial Section: Recommendation No. 1: “The Sales Managers Division of the Commercial Section of NAB registered its approval of the purpose of the resolution passed by the NAB in convention at Cincinnati in 1934, which proposed a standardized scale of units of time for sale and quantity discounts. “Since that time considerable progress has been made by the broadcasting industry and there is now a definite attitude on the part of the broadcasters, as well as an expressed desire by many advertising agencies, to standardize even more definitely the matter of units for sale and quantity discounts. “Therefore, the Sales Managers Division in meeting in Chicago, January 18 and 19, 1937, respectfully submits to the Commercial Section of NAB for early consideration the following units of time for sale and quantity discounts: a — Units of time for sale b — quantity discounts 1 hr. 13 times — 5% y2 hr. 26 times — 10% J4 hr. 52 times — 15% 5 min. 100 times — 20% 300 times — 25% “Regarding announcements, we believe that further consideration should be given toward standardization. “We further believe that all rate cards should be printed to show the actual rate or cost after application of the above quantity discounts.” Recommendation No. 2: “The Sales Managers Division in meet¬ ing in Chicago, January 18 and 91, 1937, respectfully directs to the attention of the Commercial Section of the NAB that considerable confusion exists in the broadcasting industry with respect to whether announcements or spots should be combined with program units of time of five minutes or longer in the matter of figuring discounts. “It is our recommendation that announcements or spots of less than five minutes’ duration should not be combined with units of time of five minutes or longer in the matter of figuring discounts. “We propose that announcements or spots of less than five minutes’ duration should be combined in figuring discounts and that units of time of five minutes or longer should be combined in figuring discounts.” Every sales manager is conversant with creative selling. He may not be able to define the term but he is practicing the principles if he is selling commercial programs. He knows that creative selling, like patriotism, has had many a crime committed in its name. While he is the first to admit that the present system of national repre¬ sentation is not 100% effective, nevertheless he believes that it is the best method so far developed. He, therefore, condemns the grant of 15%, 7j4% or any commission at all to any organization other than the representative with which the station has an agree¬ ment. He believes that this practice will set back the development of sound business principles in our industry. This is no 5-to-4 de¬ cision. It is the unanimous verdict of the eighty-two sales man¬ agers assembled at the First Annual Convention of the Sales Man¬ agers Division. During the past two days the Sales Managers Division has held two business meetings. Many of you have attended these meetings so that no review now seems necessary. However, at the Tuesday afternoon session of this Division, considerable discussion developed about the practice of some transcription, program and announce¬ ment production companies in calling on prospects in various com¬ munities without first contacting the radio station or stations in those communities. In many instances this practice has very definitely proved detrimental to our medium and our clients. Often these services have been sold at exorbitant prices, which, when the cost of station time was added, made the total cost of the advertis¬ ing so high that it could never pay out. We urge all stations to watch and guard against this situation. In the same breath we commend those transcription, program and announcement produc¬ tion companies which first check with the radio station or stations in the communities in which they hope to sell their services. The group also unanimously commended J. Buryi Lottridge for his un¬ tiring and constructive efforts in the creation and building of the Sales Managers Division and voted Mr. Lottridge an award of permanent appreciation. We believe, in closing, that our enthusiasm, both individual and collective, for these meetings of groups of sales managers, coupled with the objectives and attainments so far recorded merits a con¬ tinuation of the Sales Managers Division of the Commercial Section. Thank you. CHAIRMAN CARPENTER: Thank you, Avery, and all the men who worked with you. Where are Bill Clark and Les Fox? I have some work for them up here. Will you pass out these blue sheets? Now, while they are passing out that material, we will have the report of the* Com¬ mittee on National Sales Methods and Costs, by Carl Everson of WHKC, Columbus, Ohio. CARL EVERSON (WHKC, Columbus) : Mr. Chairman, ladies and gentlemen, it was the duty of the National Sales Methods and Costs Committee to determine the best methods to be used in secur¬ ing national spot business, also to study the cost of same. I wish to state here, before going into the body of the report, that in the opinion of the committee members further study of these subjects should be made before definite recommendations are sent to the Board. The reason for this is that some of us were brought into the picture at quite a late date — this through no fault of the General Chairman, I assure you. Therefore, the following members recommend a further study: Dale Robertson, Father Wagner, Tim Goodman, William Gillespie, Dick Mason and J. H. Ryan. We do feel, however, that enough was accomplished to jus¬ tify the time given us on this program to acquaint you with what has been done. The title, “National Sales Methods and Costs,” suggested the following subjects which will be taken up in the order named: 1. National Representatives and Branch Offices. 2. Organizing Local Media Groups. 3. Recognition of Obscure National Agencies. 4. Centralized Agency Recognition Bureau. 5. Bulk Sales. 6. Per Inquiry and Contingent Business. Going back to number one, “National Representatives and Branch Offices,” we feel that national representation, either through an established firm or branch offices, is essential for the successful selling of any station which serves a market of sufficient proportions to justify the interest of national advertisers. In the case of highpowered stations, strategically located in major markets, the idea of establishing independent branch offices might be entirely prac¬ tical and perhaps more profitable than dependence upon an estab¬ lished representative firm ; however, in the case of regional stations in particular and stations in general, which do not enjoy sufficient national spot billing to justify the maintenance of independent branch offices, national representatives are, in our opinion, the answer to sales problems in this field. The percentage charged for securing national business by a representative should be based on the popularity enjoyed in the national field by the station or sta¬ tions involved. In no case should it exceed 15% of the net after the deduction of the advertising agency commission. “Organization of Local Media Groups” — this, we believe, would go a long way in any city or market toward stabilizing and pro¬ moting the business of advertising. The idea of a media recogni¬ tion bureau has been before NAB conventions for the past few years. Many suggestions have been made but little was accom¬ plished. However, a year or so ago in Cleveland there was organ¬ ized a media group. This local media group has worked out so successfully and has brought about such a perfect understanding between all media that we believe a recognition bureau patterned after the Cleveland group would be very desirable. To go into detail regarding this group would take more time than allotted here. However, so that you may become familiar with its work¬ ings, copies of the rules and regulations are available and are being passed out at the present time. Be sure to get a copy ; read it care¬ fully. “Recognition of Obscure National Agencies” — recognition of obscure national agencies and a centralized agency recognition bureau are so closely related to a media recognition bureau that in our opinion, an NAB media recognition bureau would solve the whole problem. We are all aware that the need of a national agency recognition bureau has been felt for several years. You all know of the discussions on this question which have taken place at each convention for the last two or three years — and hardly any¬ thing has been done in the matter. Probably the reason for this failure is that we have attempted to start at the wrong end of the problem, trying to build entire national organization before various localities were ready for it. Since a number of cities have already formed local media groups modeled on the Cleveland plan, it is the recommendation of your committeemen that this expansion con¬ tinue and be encouraged. Undoubtedly, in a short time a national clearing house may be established for each of these local media 2461