Despite Their Challenges, Yield Management Solutions Will Become More Critical in 2023

There39s another matter to contend with reduced linear ad sales as marketers reallocate a greater share of their budgets to digital eMarketer projects that digital ad spending will increase 129 in 2023 Growth for broadcast radio and TV pale in comparison Radio is only expected to have a 19 CAGR compound annual growth rate from 2022 to 2028 globally according to Grand View Research Broadcast TV in the US has a projected 3 drop in 2023 according to eMarketerIn lieu of adding more inventory or hiking rates for priceconscious clients where can you turn to improve revenue Yield management also known as dynamic pricing could be the solution that keeps them on track It39s a proven strategy but broadcasters haven39t widely adopted it Before suggesting a path toward using yield management let me explain some of the issuesClearly there are reasons to believe it can work Airlines hospitality retail and live entertainment see the case of the 5000 Bruce Springsteen tickets are great examples of industries that successfully use dynamic pricing Broadcasters have dipped their toes into the practice using various technologies and methods to offer up the quotrightquot price However many express concerns that it39s too complex too expensive or too hard to scale Other issues relate to accurate data granularity and lack of parametersThen there39s the issue of technology Often yieldmanagement platforms aren39t as userfriendly as they need to be for salespeople Some systems keep accessibility out of reach with clunky user interfaces and the need to get ad avail and other data from traffic systems which have never been salesfriendly platformsAnother challenge relates to the lack of granularity Some tools don39t price at a block level of for example 30 minutes So are you getting the best price for inventory Demand fluctuates considerably around timeslots and programming so having the ability to get granular mattersIn addition ceilings floors and discount tolerances need to be in place Ultimately you don39t want to leave money on the table nor do you want to miss sellouts because once inventory is gone it39s gone Setting ceilings and floors is possible with tailored rate curve algorithms Regarding discount tolerances you should be able to apply those at the seller level to avoid overdiscounting something that happens too often in pricing even with yield management deployedEven if you remedy these implementation challenges you may still have a problem that relates to data which fuels spotrate optimization You need realtime avails delivered from traffic systems and historical data Ratings data is critical as well as is data related to timelines It may be difficult to integrate all this information into legacy traffic systems Rarely do they play nicely with other systems In some cases exporting the data isn39t possible without significant expense and integrationThese barriers put broadcasters in a position of being datapoor If algorithms can39t ingest realtime avails and ratings information you39re back to manual options for pricing based more on intuition and complicated spreadsheets rather than clean dataFew of the yield management tools available were designed for the media industry Even some that were fall short for several datarelated reasons So it39s important to ensure that the system you choose allows for a clean integration between traffic and the revenue management tool for spot optimization Also confirm that you won39t have to pay exorbitant costs to access your own data which some vendors requireYou39ll need to ensure you have easy access to data and that will require integration Your yield management platform should be trafficsystem agnostic otherwise you39ll need to adopt a new one which comes with migration costs and learning curvesIn the end it comes down to selecting the most robust platform that fits your needs doesn39t hinder data access and has the features necessary for yield management to deliver the right spots every timeNo matter how far along you are in adopting yieldmanagement solutions chances are you can streamline it further to improve revenue with the right technology and data access Granularity ease of use and scalability will impact your success If and when you master those elements your revenue prospects for 2023 will become much brighterRenee Ingenito is Vice President of Enterprise Sales at Marketron Her division helps power the future of all media sales with strategies and solutions that deliver more scalable predictable and reliable revenueClick the social buttons to share this story with colleagues and friendsThe opinions expressed here are the author39s views and do not necessarily represent the views of MediaVillagecomMyersBizNet

SUBSCRIBE FOR FREE MEDIAVILLAGE CONTENT | BECOME A THOUGHT LEADERSHIP CONTRIBUTOR

Despite Their Challenges, Yield Management Solutions Will Become More Critical in 2023

Publish date

Channel

SUBSCRIBE FOR FREE MEDIAVILLAGE CONTENT | BECOME A THOUGHT LEADERSHIP CONTRIBUTOR

Despite Their Challenges, Yield Management Solutions Will Become More Critical in 2023

Enjoying This Commentary? There's More to Love

Stay in the know with more from MediaVillage

TAGS:

Cookies