[quote style=”boxed”]Having status report meetings. I have made this a ritual since I first read about them in a book called the One Minute Manager many, many years ago. I believe so much in status reports that I’ve built them as custom reports into our CRM system so that they are automatically generated for each team member. [/quote]
Dave Newmark created Bid4Spots in 2005 to enable businesses to buy prime radio airtime at greatly discounted rates and to help radio stations from across the nation monetize their unsold prime inventory each week. Seeing an opportunity in the nationwide supply of unsold commercial ad units, Newmark, who had been running a successful ad agency with his wife, Patty, devised a “reverse auction” in which radio stations bid for advertisers’ spots (hence the name, Bid4Spots), driving down the price that the advertisers pay per ad unit. Savings from this process generally range from 60 to 90% off regular rates. Newmark developed this reverse auction ad exchange in such a way that radio stations are able to preserve the integrity of their regular ad rates, while allowing advertisers to take advantage of discounted last-minute prices. By launching Bid4Spots, Newmark created a win-win national radio advertising marketplace, where both advertisers and radio stations benefit from the exchange.
Newmark started his professional career at his father’s full-service agency, Newmark Advertising. He worked to master the craft of marketing and advertising for radio, television and print media. As vice president of the firm, he supervised the planning and buying for all media. Newmark analyzed the craft of endorsement radio, in which influential DJs acted as spokespeople for local businesses. Together with his wife, Patty, who now leads that company and is also a Stanford graduate in psychology, he developed the first national catalog of the top influencers in regional markets and rebranded Newmark Advertising to specialize in endorsement radio. Newmark also invented Newmark Advertising’s proprietary software, AirChecks Online, a system which allows stations to transfer spots to a database shortly after the spots air, for advertisers’ records and monitoring/guidance purposes.
In addition, Newmark created the CBS Radio Marketing Partnership, a program which is still used in the radio industry.
Newmark received a Bachelor of Arts in Human Biology from Stanford University in 1979. He was nominated for Ernst & Young’s Entrepreneur of the Year award in 2006. He lives in the Greater Los Angeles area with his wife, Patty. They are parents to two children, Michael and Elizabeth. Newmark is an active and involved alumnus of Stanford University, having co-led one of the university’s first $1 billion-plus fund-raising campaigns. He lectures throughout the country on radio advertising and business.
Bid4Spots, headquartered outside Los Angeles in Encino, CA, enables a win-win advertising buying experience for businesses of all sizes and selling experience for radio stations. By flipping the traditional auction model, Bid4Spots has become the premier radio marketplace for unsold advertising inventory in the United States and the United Kingdom. Bid4Spots allows American businesses to take promote their products, services or organizations on stations throughout the country more easily and cost-effectively than had been possible before. For more information, visit www.Bid4Spots.com
Where did the idea for Bid4Spots come from?
Back in 2004, one of our ad agency clients (it happened to be The Sharper Image) asked me whether there was an easy, scalable way to access last-minute, unsold radio commercial inventory at deep discounts. There was not. One night, I was watching my son buy something on eBay and the idea of doing an online auction for radio airtime came to me. But further research uncovered that ad exchanges for TV or Radio had failed in the dot-com boom/bust of 1999-2001. I realized that the reason they had failed was that they had the auction formula backwards. In this situation, the radio stations hold the high supply (of commercial inventory) and the demand from regular advertisers is low at the last minute, so sellers should be doing the bidding and the lowest rates win. This reverse auction concept became the foundation of Bid4Spots.
What does your typical day look like?
I wake up at 4:30 every morning and either do a treadmill run or head to a nearby gym. I’m usually out of the house by 6:30 in the morning. Half of our staff works from home around the country, so the first thing I do is check in with them. I spend about 15-30 minutes scanning industry news from various newsletters, blogs and e-mails. That I tackle the most difficult and complex projects first thing (when I’m fresh). The bulk of my day is comprised of strategizing with my team members about auction structures and making a few calls myself on the front line of sales. I almost never take lunch out – it’s just a 15 minute break. Once a week I meet with my staff one-on-one (by phone) to review every single advertiser they have in the auctions to make sure we’ve thought of every way we can help them. I usually leave the office that about 6 PM, so it’s typically about a 12-hour day.
How do you bring ideas to life?
The first thing I do is to talk about them with as many colleagues as I can to see what may be wrong about them. I work with really smart people so I respect their opinions but ultimately trust my instinct the most. Then I find the right people to execute those ideas. Sometimes they are internal people; sometimes external. While having internal staff may seem like the least expensive way to bring an idea to life, it can also have the negative effect of taking focus off of the core business activities.
What’s one trend that really excites you?
The fragmentation and diversity of media. The more fragmentation there is, the better it is for us because our platform brings all the media together into one place so that advertisers don’t have to spend any time finding or negotiating with them.
What is one habit of yours that makes you more productive as an entrepreneur?
Having status report meetings. I have made this a ritual since I first read about them in a book called the One Minute Manager many, many years ago. I believe so much in status reports that I’ve built them as custom reports into our CRM system so that they are automatically generated for each team member. I can pull up these status reports at any time but in my weekly one-on-one meetings with those team members, we review their status report line by line. Detailed status reports, dynamically created through the CRM, is a quick, efficient way for me to stay in touch with the details of my business without losing sight of the high-level role I play.
What was the worst job you ever had and what did you learn from it?
Bank teller. My strengths are conceptualization of ideas and selling/teaching but that job (which I had during my college years) tapped neither of those skill sets. I was one of the worst if not the worst bank teller on the line – almost always being a few pennies out of balance. This did not endear me to the supervisors who had to stay late to find my mistakes!
If you were to start again, what would you do differently?
I would have outsourced our technology development sooner rather than we did. I discovered that what outsourced developers (here in the U.S., by the way) may not have in the way of subject matter expertise, they more than make up for in speed to market and being able to bring as many people and resources to get the job done as is necessary. Moreover, outsourced firms have to stay totally current in technology trends; they can’t rest on past laurels as might happen with in-house developers. Finally, unlike in-house developers who may be afraid to confront “the boss” for fear of losing their jobs, outside companies succeed most when they speak the truth most clearly to power.
As an entrepreneur, what is the one thing you do over and over and recommend everyone else do?
I like to say that a problem unknown is a problem unsolved. So, I have formal meetings (my status report meetings) on a regular basis to unearth and then solve problems. When there are relatively few employees, it may seem superfluous but meetings held on a daily, weekly or other basis that are in the calendar give you and the other person a chance to communicate about issues that may be not get addressed in normal, daily conversation. I am always so surprised to hear about other entrepreneurs gripe about their managers or staff when having formal status report meetings on a regular basis where all the issues get addressed could solve so many problems.
What is one strategy that has helped you grow your business? Please explain how.
In contrast to the lesson we learned about closing our in-house development team and outsourcing it (described above), we found that bringing our Google Adwords buying in-house was the best approach. Search advertising can be a powerful way to bring in new customers but we found over the years that outside firms just measured success on cost-per-click or cost-per-thousand impressions. Neither of those two metrics have anything to do with ROI. So now we manage everything in house such as constantly testing every aspect of the chain – the landing page design, the text ad, the key words and tie them back to advertiser spending. This end-to-end analysis, which only we could do since we have all the data, is what has made our Search advertising through Google incredibly productive.
What is one failure you had as an entrepreneur, and how did you overcome it?
Expansion into marketplaces where we did not have a complete understanding of how they work. In mid-2009 we launched a TV marketplace. Just as we do with radio stations bidding against one another in a live, reverse auction, we created a marketplace where cable systems would bid against each other. The main problem was that while radio stations do play by the rules and do not preempt our spots (do not bump them), the cable TV systems did bump the winning spots almost all of the time! We spent an expensive year trying to fix this problem and after 12 months of frustration I pulled the plug on it.
What is one business idea that you’re willing to give away to our readers?
Lead aggregation is common on a B2C basis in a number of industry verticals. If I had the time, I would build a business of lead aggregation for B2B for products and services that businesses would buy from other businesses.
What software and web services do you use? What do you love about them?
For task management, I love the simple interface of the App called “Things”. Someone who used to work at Apple computer told me that employees at Apple use it all the time and he turned me on to it. For CRM, I know that Salesforce is the most popular but I’m partial to Microsoft CRM. It’s easy to use, integrates well with Outlook and offers a way to build custom reports that are extremely useful to us. For keeping track of ideas, web links and other assorted items, I like e and Springpad. For collaboration and web-forms, I like a product from Citrix called Podio. And we use another Citrix product called GoToMeeting all the time. I just discovered another app from a New York Times review called Scanner Pro. It’s $7 but very cool.
What is the one book that you recommend our community should read and why?
There is no doubt in my mind: Washington’s Crossing by David Hackett Fischer. When you read this book about General Washington (before he was our nation’s first president), you have to admire his stunning amount of fortitude. How on earth did he manage to vanquish an enemy that was far better funded and had much more experience? Through bloody, freezing marches to cross the Delaware River with hungry, tired, vastly-underpaid volunteer soldiers whose boots were mostly worn through, Washington led an enterprise that leveraged the true motivation of his troops. To quote Fischer: “Their (the Americans) greatest advantage was the moral strength of a just cause. They were fighting on their own ground, in defense of homes and families, for ideas of liberty and freedom. They had a different test of success. Their opponents had to conquer; the Americans needed only to survive.” Any entrepreneur can relate to that and draw inspiration from this most am azing man.
What people have influenced your thinking and might be of interest to others?
There are so many, I have trouble limiting the list but here are the top ones:
• My father who, like the first two I mentioned, has always taught me to put the customer first
• My wife, Patty, who amazes me with her brilliance, dedication to excellence and integrity
• Patty’s father, Marvin Kroner (now deceased), who showed me that huge financial success and humility could co-exist
• Jim and Chris McCann of 1-800-Flowers who I’ve come to know personally (they are a client of my wife’s agency, Newmark Advertising) because no matter how large the company becomes, they have a relentless focus on making sure customers get the most beautiful flowers at the lowest prices. These people started out in the flower business and never forgot it.
• Steve Jobs for his vision, imagination and singular focus on quality execution of that vision
• Jeff Bezos for being able to express his outsized ambition and fear at the same time
• Sam Walton who demonstrated that one of the keys to success in business is recruiting the best people. I was surprised to find in a biography I once read about him how much time he spent in the early years flying around in his little plane all over the country to woo managers from other stores (mainly JC Penny) to come work for him. He was the most relentless and incredible recruiter I’ve ever read about.