Hot job: Selling Web ads
A shortage of online advertising sales reps has led to bidding wars, lavish perks, and fat salaries, reports Fortune's Jessi Hempel.
(Fortune Magazine) -- In the 1967 classic The Graduate, the Mr. McGuire distilled his career advice for the young Benjamin Braddock into one word: Plastics. Were he to corner young Ben in New York City today, he'd probably use three words: online ad sales.
A shortage of salespeople in Silicon Alley and beyond has led to bidding wars, perks, and salaries not seen since the feeding frenzy over Silicon Valley engineers first began in 1999.
Why the huge demand? For one thing, even as the outlook for the broader economy appears shaky, web companies are aggressively expanding their ad operations to New York.
Google (Charts, Fortune 500) recently announced plans to add an in-house ad operation to its fast-growing Manhattan offices, while AOL (like Fortune, owned by Time Warner (Charts, Fortune 500)) will move its headquarters to New York from Dulles, Va., next spring. Traditional media companies, meanwhile, have been beefing up their digital presence. (Witness CBS's (Charts, Fortune 500) recent purchases of Wallstrip.com and Last.fm.)
But there's a greater shift happening too - a Web 2.0 epiphany that the money to be made online is not in selling content and subscriptions but in advertising. Rupert Murdoch conceded as much when he said recently he's considering dropping the Wall Street Journal's web-subscription model.
As a result, old-world media companies, large-cap web firms and startups alike are migrating to Madison Avenue.
Hiring a sales director "is the single biggest challenge that we have faced," says Dina Kaplan, co-founder of Blip.tv, a video-sharing site. Kaplan says she spends as much as six hours a day searching for the right person. She's close to a hire - "We're trying to steal someone from a TV network," she says - and may offer twice her own salary.
Kaplan still might have trouble. Head-hunters say media companies are paying big bucks to hold on to their salespeople. Salaries plus commission at those firms can stretch beyond $400,000, according to Todd Zangrillo of technology executive search firm Barlow Group.
And counteroffers are a given. Zangrillo tells of a candidate at a big TV network making more than $500,000: "He basically said, 'Don't approach me unless you have an offer north of $600,000.'"
Recruiters are profiting from the demand too. Blip.tv's Kaplan hired a recruiter for a standard rate - 15% of the new employee's salary. But after getting one subpar résumé in two months, she is considering switching to a recruiter who promises better finds but for a hefty price: a monthly retainer of $10,000 and 33% of the employee's first-year salary.
Meanwhile, anyone with experience now spends part of the workday fielding calls from those recruiters.
Chris Batty, VP of sales for Gawker Media, says he sometimes gets three calls a day. Jeff Zaretsky, who left a sales job at AOL last year for KickApps, a social-networking software startup, says he's approached several times a week by phone and on LinkedIn.com. (While reporting, this writer was offered a "mid-six-figure" salary by a CEO to defect.)
And while it might seem as if any college grad should be able to sell space online, recruiters say it's not that simple: In addition to bringing the right relationships, reps have to be conversant in tech-speak like RSS feeds and Ajax, and capable of conceiving new ideas that make creative use of widgets, gadgets, and a myriad of other online tools.
Still, not everyone is buying into the mania.
Jake Dobkin, publisher of Gothamist.com, has interviewed several candidates for a sales director job but says instead of engaging in bidding wars he might train a young person - or just do the job himself while he waits out market conditions.
"I've seen the ups and I've seen the downs," says Dobkin, who founded Gothamist in 2003, right after the dot-com bust, when no one was interested in online advertising. Things may look good now, but he's not taking any chances.