Successful Agencies Listen Better

One of the most common mistakes that agencies make in new business prospecting is to develop a messaging strategy that is focused on what they want to say, not what the client or customer needs to hear. Even when the agency thinks they know what the client is looking for, they may still miss the mark, if they don't truly understand how the prospective client defines the issue.

This point was driven home today when I attended a luncheon presentation on healthcare marketing entitled "Messages that Resonate on Quality". The speaker asked each table to discuss how to define quality in healthcare, and then proceeded to show us research that showed we had all missed the correct answer.

Our table quickly defined quality as a positive outcome. When you are sick, the doctor diagnoses your problem and prescribes a cure that works. Problem solved. Except neither the patients nor the healthcare professionals who responded to a national study by the Robert Wood Johnson Foundation defined quality as a positive outcome.

To the patient, quality is about the relationship and the personal experience during the entire process of setting the appointment, visiting the doctor's office, spending time with the doctor (or nurse practitioner), and the billing experience with the insurance provider. Of course, they want a positive outcome, but if the experience is sub-par, so is the perception of the quality of the healthcare provider. To the healthcare professsional, quality is about the efficiency and mechanics of the process. How difficult is it to schedule an operating room? What is the availability of specialty nurses?

So how does this relate to business development for an agency? Simple. We need to listen better to what the client says and then try to understand what they really mean.

How many agencies continue to focus their sales presentation on creative execution when the client really wants to know how effective the campaign was in generating sales and profits? How many agencies try to make a big splash by showcasing their award-winning television, when the client's need is print and outdoor, or when their customer base is 18-24 males who are infrequent television viewers?

When the RFP asks you to describe the "efficiency of your media department" are they asking about the planning and buying process or about the relative cpm vs. SQAD data?

Agencies that succeed in new business listen better. They ask questions. They try to understand what the client really means. They build a relationship to make sure they focus their selling message on what the client needs to hear, not what they want to say.

A Look at the Ad Agency of Tomorrow

If you do nothing else today, read the lead article in the newly released Razorfish Digital Outlook Report titled "A New Role for Agencies. From Breaking Campaigns to Building Client Businesses". Follow this link to the complete report http://digitaloutlook.razorfish.com/publication/xml/4837/13617/13617.pdf
This year's DOR is filled with many excellent articles, but for anyone involved with new business, the most thought-provoking is the introductory one by CEO Clark Kokich.

Clark explains that his primary role as an agency head used to focus on talking to clients about how to say the right things, e.g. what do we need to say to persuade people to buy our product or service? He says that today he spends more time talking to clients about how to build relationships with their customers -- what do customers need to know to make smart decisions? how do we reach customers on the go? how do we help customers share their experiences with their peers?

This is not a new message from a digital agency. Every advertising conference for the past few years has predicted that the future is in building customer experiences, not just in producing great advertising. Clark takes this message a step further by pointing out the impact this change is having on the role all advertising agencies can, and should, play within client organizations.

As I have noted in previous posts, many clients are simply overwhelmed by the plethora of new digital tools and how to use them to their advantage. In today's challenging marketplace, clients are not saying to their agencies, "How can you help us make ads or a new web site," they're saying, "how much do you understand about our business in order to help us build a bridge between our brand and our customers." The question is not just how to effectively use email, blogs, podcasts, mobile marketing, viral marketing, pay-per-click, user-generated content, Twitter, etc., but how to mix them with traditional media to create the most impact.

There is no question that the new digital environment opens opportunities to redefine and expand the role agencies can play with their clients. Clients are dealing with a laundry list of challenges – a struggling economy, competition from companies and places that they never dreamed would impact their business, a continued drive for lower costs, and perhaps, most frightening of all, a growing realization of the power that a connected consumer has over their business strategy and success.

Clark's essay concludes that clients need ideas that will transform their business and that now is the time for agencies to step in as a partner in setting business strategy, designing products and services to meet changing customer needs and wants, and creating new revenue models for their client and for themselves.

This is, indeed, a new role for agencies. It will not only require new skills, it will demand that agencies expand their definition of what it takes to be a great agency. The agency of tomorrow will truly understand how to help their clients find the ideal marketing mix of "creative, technology, media, user experience and analytics."

It's a new role for agencies. Frightening to some. A great opportunity for all who embrace it to its fullest extent.

New Rules for New Business - Part 3 of 3

In Parts One and Two of this series on New Rules for Pitching and Winning New Business , I focused on how to approach new business today and how to build a sales story for your agency. To recap, the first six rules for a successful new business program are:

Rule #1 - Project work is the name of the game. Most clients don’t want or feel they need an Agency of Record (AOR) relationship.
Rule #2 - In today’s world of fragmented media and extreme audience segmentation, you must own a niche, or even a niche within a niche to differentiate your agency.
Rule #3 - Creative expertise is yesterday’s discriminator. It’s still important, but ROI is the most desirable characteristic today.
Rule #4 - Agencies need to build an ROI story into every case study.
Rule #5 - Your website is the “front door to your brand”. Make sure it is tells a powerful brand story or prospects won’t even bother to knock.
Rule #6 - Give them a new insight on their business that will grow their sales and profits.

In today's post, we will focus on a couple of practical strategies to be more efficient in your new business program and finish off with the one thing every agency must be doing to grow their business.

7. Be very specific in building a prospect target list. You can’t afford to waste time, effort and dollars on long shots.
New business has always been a numbers game. The more clients you can effectively network with, the more clients you can potentially gain. For many years, new business plans have organized prospects into three buckets – short term prospects (the proverbial low-hanging fruit that you have already built some level of relationship with), developmental prospects (those who need to be developed but are still well within the agency’s reach), and long shot prospects (the clients that can redefine an agency). As a new business consultant for several agencies, I used to promote this strategy in building a new business plan. Today, however, I counsel agencies to focus on short term prospects with some effort against developmental prospects and to be very cautious about investing in long shot prospects. This is especially true in today's cautious business environment or if the prospect’s business category or audience is outside the agencies’ general niche of expertise or size.

When building a prospect list, an agency should ask themselves how difficult it will be for the CMO to choose their agency for the assignment. Is your agency the right size for the client? Does your agency personality and style match, or closely resemble, that of the client? Do you have the right category experience? Does your agency have solid case histories that prove you have been successful for similar clients with similar needs?

If your answers are no or maybe, there may be too many hurdles to overcome for a client to choose your agency. In my experience, today CMO is not only looking for an agency that can do the job, but also for an agency that is defensible to their management.

I’m not putting client marketing directors down. I’m simply stating a fact. They can’t afford to make a mistake – their job depends on making a good choice in selecting an agency partner. So they are more likely to opt for the logical choice, whether that is the best one or not. The challenge for the agency is to pursue prospects that can more easily defend their selection as the best choice the CMO could make.

8. Look first at your current clients for new business opportunities and actively seek to build a more solid trust relationship.
Everyone in business knows that it is much more costly to attract a new client than it is to retain a current client. Yet too many agencies don’t devote enough time or effort to client retention even though the level and intensity of competitive activity in the agency community is mind-boggling. According to a 4-A’s study, the average client-agency relationship tenure in 1984 was 7.2 years. By 1997, that number had declined 25% to 5.3 years and today is thought to be less than three years.

That means that for most agencies, one-third of their business needs to be replaced each year. Now, more than ever, an agency needs to find a way to continue to build their relationship with their client. Performing at a high level on today’s assignment is no longer a guarantee of a successful, long-term relationship. The marketplace is changing too rapidly to expect next year’s marketing program to have the same marketing mix or line item budget than this year’s plan.

Agencies should be constantly looking for new ways to help their clients. And the key phrase here is “to help their clients”, not to help their agency. For too many years, agencies have failed to grasp the erosion in trust that comes from self-promoting recommendations to increase television spending or to use the super-expensive director or photographer. In a world that is increasingly dominated by specialists, virtual agencies and free-lancers with lower overhead, clients can be swayed by the genuineness of your efforts to control costs as much as the quality of your work product.

9. The confusion and uncertainty of how to use social media and other digital marketing tools are a great opportunity for new business growth.
To say that the Internet has changed the way people interact and communicate with each other is only half of the story. It has profoundly influenced how brands go to market, and the effect can be overwhelming to marketers. As noted earlier, clients are looking for ideas and insights. An agency that can give information, understanding and guidance on how to use the new marketing tools presents a great opportunity for agency new business efforts.

The question for many advertisers is not just how to effectively use email, blogs, podcasts, mobile marketing, viral marketing, pay-per-click, user-generated content, Twitter, etc., but how to mix them with traditional media to create the most impact. The concept of “above the line” and “below the line” is no longer valid, if in fact it ever was. It’s all important. It’s all potentially valuable. And, most importantly, it’s a great opportunity for an agency to attract new customers. Or build a stronger relationship with your current clients.

I'm a fan of David Meerman Scott and his book, The New Rules of Marketing and PR. His ideas on the convergence of marketing and public relations on the web and on the futility of continuing to embrace the old rules of marketing in an online world make a lot of sense to me. When a buyer uses a search engine to research a company or category, it doesn't matter whether his first impression came from a television or magazine ad, a PR release, a hit on the client's web site, or a link from a Tweet. The only criteria is that a company has a consistent branding message across all access points. Clients are hungry for an agency partner that can help them utilize the new tools that are available.

So there you have it. Nine new rules to add to all the others. Understanding and adapting to these new rules can mean the difference between life and death for your new business efforts. And that can mean the difference in life and death for your agency!

Good hunting!

New Rules for New Business - Part 2 of 3

Part One of this series on New Rules for Pitching and Winning New Business focused on the positioning aspects of your agency sales story and discussed these three key ingredients of a successful new business program today:

• Rule #1 - Project work is the name of the game. Most clients don’t want or feel they need an Agency of Record (AOR) relationship.
• Rule #2 - In today’s world of fragmented media and extreme audience segmentation, you must own a niche, or even a niche within a niche to differentiate your agency.
• Rule #3 - Creative expertise is yesterday’s discriminator. It’s still important, but ROI is the most desirable characteristic today.

In today's post, the focus is on how to strengthen your sales story. Two things are important to keep in mind. The first is that most client's don't really trust agencies. It's our own fault, really. For years, we spent a lot of time recommending they beef up their ad budgets so that we could make more commission. Our recommendations were all about us, not them. And that brings us to the second thing to keep in mind. If you don't add value to the client's business, you will soon be replaced. Adding value can come in many forms, but it starts with truly looking for ways to help your client, not your agency. You must believe that in the long run you will win.

As an account manager, I was able to build a trust relationship with my clients because they knew that I was passionate about their business. I have ridden on a bread truck at 3 a.m., made store checks at all hours of the day and night, made pizza with the founder of the company, flipped hamburgers, toured chicken processing plants, and a bunch of other things I never thought I would do in order to understand the client’s business better. I would subscribe to all trade journals, and always be on the look out for articles of interest that I could send to them. I would call the client every day to make sure they knew I was thinking about their business all the time. Because I was.

Here are some new rules you can follow to give prospects "permission to believe" that you can help them grow their business.

4. Agencies need to build a strong ROI story into every case study.
A good case study has always been an effective way to give a client prospect “permission to believe” that the agency can help them grow their business. But agencies need to re-evaluate their approach to writing case studies. In the past, case studies were too often simply a device to show off their creativity or versatility. Today, a good case study should highlight the business problem, the strategic as well as the creative solution, and the results. If your client can’t or won’t offer specific results of a program, be general but give them something to indicate its success. You must give the client prospect a logical reason to transfer its credibility to their specific need.

One tool that is often overlooked is a client testimonial statement touting the effectiveness of the solution or the quality of the agency’s effort for their brand. A prominently placed affirmation from the client can lend credibility and power to your case study.

5. Your website is the “front door to your brand”. Make sure it is tells a powerful brand story or prospects won’t even bother to knock.
A colleague recently described the website as your brand’s front door, and his description is right on target. Your website speaks for you, and it is the first place that client prospects will go to begin the conversation. So it had better be good.

Every agency will promote the value of an effective web presence to their clients, but too many don’t practice what they preach. We have all heard the story of the cobbler’s children. That the cobbler was too busy to make shoes for his own family. An agency can have an effective new business program without expensive 4-color brochures or fancy three-dimensional mailers, but without a well-designed website they are toast.

The key phrase here is “well-designed” site. Agencies must be careful to avoid the temptation to be so creative in the site design and content that it is difficult to navigate or confusing in its message. Too many agencies think that an out-of-the-box approach to creativity that is loved and admired by the agency creative community is the way to build their web site. That may work for some clients, but for most, they want to view your site to learn your values, your brand focus, your work process and your successes . . . not your off-beat sense of creativity.

6. Give them a new insight on their business that will grow their sales and profits.
Now, more than ever, clients are looking for help. Many are confused about how to build and maintain customer loyalty. They are unsure of how to use all of the new digital marketing tools available to them and many are simply overwhelmed by the enormity of the marketing task. CMO’s know they have a limited life span, so they are desperate for an agency that can do something to help them grow their business and make them a hero to their management. And the best way to do that is with new ideas and new insights that can grow their business.


In a recent study published by Reardon Smith Whittaker titled "A Client's Perspective on Agencies", 81% of respondents cited "understanding of your market" as a critical factor in their agency selection. As noted earlier, the quality of the creative product is still important (69% said so in the RSW study), but if you don't understand the client's business, then the greatest creative in the world won't win the account. Here is a link to that study: http://rswus.com/documents/Final2008AgencyClientSurvey_000.pdf.

A few years ago, I spoke with Stan Richards, founder of The Richards Group, on what he considered the key ingredient in a new business pitch. Without hesitation, he replied that the ability to give the prospective client a new insight on their company or category was the key factor in winning new business. His business development team worked hard to find that insight, and then spent the majority of their presentation supporting that insight and its potential to grow the client's business.

In today's challenging marketplace, I would add the ability to help a client expand their marketing efforts into new digital media is also a key factor in choosing one agency over another. Clients are not saying to their agencies, "How can you help us make ads or a new web site," they're saying, "how much do you understand about our business in order to help us build a bridge between our brand and our customers."

New business prospecting is about building a relationship with the prospect before you get the business, not during the pitch. If you can create an expectation of the value you will add to their company, you've just shot up the ladder and moved closer to an assignment.

Stay tuned for more!

New Rules for New Business - Part 1 of 3

In his best-selling book, The New Rules of Marketing and PR, David Meerman Scott exposes the futility of continuing to embrace the old rules of marketing in an online world. The same conclusion can be drawn for agencies who continue to execute their new business prospecting and pitching the way they always have. Marketing has changed. Marketers have changed. Understanding and adapting to these new rules can mean the difference between life and death for your new business efforts. And that can mean the difference in life and death for your agency!

In a previous post, I identified nine new rules for pitching and winning new business. In this series of posts, I will discuss these new rules in more detail. As always, you can do everything right and still not win the business, but I firmly believe that if you adapt your program to embrace these new rules, you will dramatically increase your chances for new business success.

Rule #1 - Project work is the name of the game. Most clients don’t want or feel they need an Agency of Record (AOR) relationship.
A few years ago, agencies tried to make a case for providing all marketing communications services under a single agency roof. Large conglomerates like Omnicom and WPP added media buying services, public relations, direct marketing, research, digital services, etc. but the true benefits for the client were hard to identify and justify. A recent survey by American Association of Advertising Agencies (4-A’s) confirms that unbundling is accelerating across the country. Marketing directors cite several reasons for this trend, ranging from lower costs to specialty expertise to an attempt to keep agencies “on their toes”. Regardless of the reasons, and no matter how much agency heads protest that fragmenting service providers can greatly reduce the singularity of the brand message and personality, the classic AOR relationship is a thing of the past.

There is a proliferation of small consulting firms that are making a comfortable living through one-off projects that help a client set up and use tools like search engine optimization, email, Facebook, MySpace, Twitter, etc. Then they show the client how to run and maintain this on-line portfolio of communication and move on. They don't make a whole lot of money on a particular client assignment, but they have plenty of projects to work on. And without high overhead, this business strategy can be very profitable.

Importantly, they are creating an expectation and setting a precedent that traditional agencies cannot afford to ignore. Agencies must recognize and accept this new rule and identify the type of project your agency can use as an entry point for new clients. A careful evaluation of your prospect's current effort can usually identify a conversation starting point for a project that will grow or enhance their business. After you successfully complete that project, you can use the results and the relationship to garner additional projects. Hopefully, over time, you can build enough trust and relationship equity to warrant special, automatic consideration for new work, even if you never become agency of record.

Rule #2 - In today’s world of fragmented media and extreme audience segmentation, you must own a niche, or even a niche within a niche to differentiate your agency.
For many agencies, their new business focus has been to be seen as experts in a given category – e.g. healthcare, financial services, hospitality, digital marketing, etc. Or they have positioned themselves as having a unique understanding of a particular audience segment – teens, tweens, seniors, working women, etc.

Changing customer dynamics and new technology tools make it difficult for a generalist agency or category specialist to compete today. Understanding hospital customers and marketing strategies does not necessarily mean you know how to market local specialty clinics. And it certainly won't give you an inside track on how to help healthcare insurance providers optimize their marketing communication efforts.

Being a good website designer doesn’t automatically qualify you to be an expert in search engine optimization. And being an SEO expert doesn’t make you an SEM expert.

With the explosion in new media channels and digital marketing tools, clients need to be very precise in developing messaging to build small audience niches. Agencies can differentiate themselves by understanding and adapting their positioning strategy and new business efforts to take advantage of this trend.

Chris Anderson’s insightful book, The Long Tail, was about a new model for business in a world of near limitless choice for consumers. In many ways, that same “long tail” applies to the marketing communications environment. Simply being an expert in a general category or audience segment or media channel isn’t enough. The more specific you can build your expertise, the better story you will have to a client base that is increasingly hesitant to take a chance on an agency that hasn’t already proven its value in their market niche.

As marketers become more focused and precise in segmenting their audiences and media channels, agencies will need to become more targeted to be successful.

Rule #3 - Creative expertise is yesterday’s discriminator. It’s still important, but ROI is the most desirable characteristic today.
The power of a strong creative story in new business can never be discounted or eliminated. Creativity is the most exciting aspect of our business, and a well conceived idea that is presented in a unique and memorable way will always gather praise and admiration from clients.

But the most desirable characteristic an agency can offer to a prospect today is return on investment. Budget-strapped marketers are desperately seeking ways to break through the marketing clutter to reach new customers and sustain the attention of profitable customers through messages delivered at the right place, time and through the right channel. Agencies that demonstrate an understanding and a process for how to analyze and use customer information more effectively will have a much higher success rate than agencies who continue to market themselves as creative experts. Marketing analytics are not the cure-all for marketers’ woes, but they are the next big thing for agency new business prospecting.

The question for many advertisers is not just how to effectively use email, blogs, podcasts, mobile marketing, viral marketing, pay-per-click, user-generated content, Twitter, etc., but how to mix them with traditional media to create the most impact. The concept of “above the line” and “below the line” is no longer valid, if in fact it ever was.

It’s all important. It’s all potentially valuable. And metrics now give us the ability to support a recommendation beyond the traditional "trust us" concept of yesterday. The old saw that "half of my advertising is wasted, I just don't know which half" is no longer accepted by CMO's who know that there is a better way.

Being able (and willing) to apply a sound evaluation of the return on the investment is a great opportunity for an agency to attract new customers. Or build a stronger relationship with your current clients.

Stay tuned for more!