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Published on: 5/26/2007
Last Visited: 5/26/2007
Wachovia Equity Research Vice President Marci Ryvicker held a client conference call this week with Eric Mastel Of Max Media.
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Mastel is Radio Division president of Max Media, and he provided information related to his positive experience with Google/dMarc.Mastel is responsible for 37 radio stations in seven markets.
Mastel, a client of Google/dMarc since March 2005, commented that "Google provides more flexibility than we had imagined."Mastel said that Max Media's first contract, signed in March '05 (and renewed in March '06), covered a 12 month period with no automatic renewal and granted Max Media the ability to cancel at anytime with 180-day advance written notice.The financial terms include a 50/50 split of all sales as well as a minimum CPM guarantee for all spots.Mastel commented that at Max Media, "Google has typically paid 3-4 times the minimum guarantee and its rates are more than Max Media would get had it not used Google" (since inventory that goes unsold generates no revenue).
Inventory control appears to be a non-issue since Mastel points out that "on a nightly basis, Google/dMarc is allowed access to the radio stations' sales log and is provided access to sell all inventory that has not been sold by Max Media's sales force for the next day's airing."However, Max Media can review all potential sales prior to broadcast through an administrator system and if they deem particular spots undesirable (due to content and/or rate), it can immediately reject them and therefore cancel the sale without penalty.Max Media also has the ability to allocate more (or less) inventory to Google/dMarc, which could, in effect, heighten demand for other spots and increase rate.To date, Google/dMarc only accounts for ~5% of Max Media's inventory sales although the company would look to do a larger deal (similar to Clear Channel) at some point down the line.
The agreement with Google/dMarc, Mastel continues, "has introduced numerous new advertisers to Max Media's radio stations.