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!
