TB 121
Future of Media Sales
Purpose: To present different options for future management of media sales
Recommendation:That the Board notes the report and advises which option is most appropriate
Summary:To keep the Board informed of activity in and by the Union against our objectives
Financial impact:Impact is discussed under each section of the report
Student impact:Discussed within each section if appropriate
Risk:Discussed within each section if appropriate
Contact:Caroline Bates, General Manager
Context
Media sales relates to any external organisation who would like to use our channels of communication i.e. website, buildings, publicity, events to promote their business or services to Liverpool Hope students. For a fee, they can come on site to distribute promotional materials and/or promote themselves, place an advert in our publicity or sponsor an event.
BAM Student Media currently have exclusive rights to our media sales and have done this on our behalf since 2009. They take around 32-34% commission from the total income. A breakdown of the income levels is detailed below for information
Media Sales figures
Total Income / Liverpool Hope SU Income / BAM commission2009-10 / 12,447 / 8,468 / 3,979 – 32%
2010-11 / 9,990 / 6,993 / 2,997 – 30%
2011-12 / 10,656 / 7,394 / 3,262 – 31%
2012-13 / 19,374 / 12,624 / 6,750 – 35%
2013-14 / 19,950 / 12,970 / 6,980 – 35%
2014-15 (to date) / 21,045 / 13,847 / 7,198 – 34%
A large and increasing proportion of our media revenue, 63% last year, is generated over the Fresher’s period, see table below.
Year / Fresher’s Fair income2011-12 / 7,575
2012-13 / 8,650
2013-14 / 8,250
2014-15 / 7,650
Many of these bookings are repeat business which has attended the fair for the past three years. There is the argument that BAM do not have to invest a great deal of resource in generating this income. Despite numerous discussions they have failed to significantly increase revenues outside this period.
In addition two exclusivity deals with Dominos and Alpha Taxis have been in place for the past three years and are worth £6,000. Initial conversations with Dominoes have indicated they are keen to protect this market and would therefore renew this contract. Alpha Taxis are also keen to begin discussion for next year and are keen to renew. It has come to light that there is the opportunity, particularly with the pizza exclusivity to increase the value of any exclusivity arrangement and to see if this makes financial sense given the competitive nature of the market.
NUS Media have approached us with a counter off to BAM (details in table below).
This paper outlines all the options available to us and The Board are asked to express which option is the most appropriate.
Decision Required: Board to advise on which option the union should move forward with.
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TB 121
Key options going forward
Option / Notes / Pros / Risk/Cons / Resource implications- Remain as is – BAM exclusive
- Low risk, income levels have remained constant
- No additional resource required
- Strong National client base relationships
- Static growth over last 3 years
- NUS Media Partnership
- The would employ a Regional Sales Manager to develop local business
- National Media Sales expertise in the staff team
- Not yet at a point to be attractive to National Clients so these would still come via BAM or another agency
- Approx. 30% commission rate
- Unsure as to if any other unions are likely to want to join – given time of year don’t think scheme is at a point I am confident to commit to.
- End exclusivity with BAM and use Liverpool SU (JMU) and agencies to drive revenue. Focus on LiverpoolSU relationship.
- 10% commission paid on long standing agreements i.e. Dominos and Alpha – handled by LiverpoolSU
- Continue to take bookings via BAM but also other agencies
- Significantly reduced agency commission rates at 10% - from 34%
- LivSU already 2 years ahead of us in terms of relationships & processes and have had a positive income results. Currently at 120k this financial year
- LivSU very keen to develop this relationship and want to make it work. Their board have already agreed the partnership and happy with SLA. We are in a strong place to begin this partnership from June 2015 – in time for Welcome bookings.
- Potential to target local companies although unlikely to result in huge incomes but would diversify our offer to students.
- All income would be kept in the movement
- NUS Media haven’t brought lots of opportunities to date so we would be heavily reliant on LivSU to drive sales. We would not be their priority
- Potential impact on relationship with BAM; would need to manage this carefully as they would still bring bookings to us.
- Additional staff admin resource required to support the set up and development of this new venture. Investment in LivSU relationship required.
- Additional workload for finance in terms of invoicing. Currently invoice BAM three times a year. There would be significant number of individual bookings across the year. New finance system works smoothly and the additional workload would be manageable if we can recruit 3rd yr accounting students on placement to assist General Manager.
The relationship would be directly managed by the General Manager to begin with to ensure processes are established and resource implications assessed.
There is potential for this additional income to be used to expand services or increase surplus target.
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