It's time to admit it: You’re bad at new business.
There is good news though. Most of your competitors are bad at new business, too. The bar is low because agencies often fall into the same traps, and they exhaust their efforts looking for that elusive “silver bullet.”
“Agencies need to stop buying into their own excuses,” said Drew McLellan, owner of Agency Management Institute, an agency association/network that consults with small- to mid-sized agencies.
New business needs to be priority -- that’s rule #1. No amount of tips, tricks, and tools will save your flailing business if you don’t adhere to this decree. “The magic bullet to new business is to do it every day," McLellan said.
In addition, agencies need to be realistic. “The other thing that agencies lose sight of is they build these big, grandiose plans that they can never really actually sustain,” McLellan said.
If an agency can commit to doing a few key things consistently well, they can land the right type of clients -- ones that are profitable, loyal, and good for case studies for future business opportunities. And you don’t need a million of these to find yourself running a profitable and productive agency.
5 Mistakes Derailing Your New Business Program
So what should agency owners focus on? And what mistakes should they avoid in the process of building a sustainable new business program?
McLellan works with agencies on the consulting side and he runs his own marketing agency, so he’s well aware of the challenges facing owners. Here’s his advice on why your new business program is failing and what you can implement to turn things around:
1) It’s Always Feast or Famine
Which would motivate you to act more quickly? The fire engulfing your house or the termites chomping their way through the foundation of your home?
There’s always an emergency, a “situation,” or a crisis that needs your immediate attention.
“Most owners are still too entrenched in working in the business rather than on the business,” McLellan said.
This typically leads to panic once you realize that that your client list has slowly eroded and you need new accounts yesterday because tomorrow you will have to fire people.
Agencies that fail to commit to ongoing new business efforts struggle because the sales process in our industry is long. AMI’s latest research report found that more than 50% of marketers take more than three months to choose an agency even when they are actively searching for a new firm.
In addition, they discovered that 85% of decision-makers are finding the agencies they want to work with, not the other way around. So low-touch, ongoing marketing activities, such as content marketing, email marketing, and social media, should be a priority. Remaining top of mind by producing smart, helpful content for your prospects means you will be top of mind and on the list of agencies to call when a client finally decides to switch firms.
McLellan, who run his own agency -- McLellan Marketing Group – gave this example: He spoke at a conference more than four years ago. A year later, the marketing manager of a bank who had attended reached out to him asking for a proposal for a rebranding project. She went silent after he sent the contract, but she was subscribed to his firm’s monthly newsletter and followed his blog. Just this past month, she reach out again about the same project. McLellan simply updated the date on the proposal, sent it back to her, and now he has a signed agreement.
2) You Want the Mythical New Business Guy
“If I could get every agency what they want for Christmas, it's someone else to do new business,” McLellan said.
Most agency owners are do not come from a sales background. They haven’t been trained in sales. In fact, they are repelled by the word sales -- hence new business.
And while an agency can hire a new business director, the owner still needs to be involved in the sales process. Clients only care about marketing if it helps them achieve their goals so they can ultimately keep their jobs. Clients want to talk metrics and business, not marketing and creative. And most likely, the agency owner is the only person who can really speak on this level.
That’s not to say that you shouldn’t hire a sales person – someone who can hunt for new business, cold call, and organize people around a pitch or proposal. McLellan also suggests that this person track the 10 or 20 “dream” accounts your agency really, really wants. This person should be actively pursuing these accounts. After all, if you get just one of those accounts, that’s a good year. In addition, this person can be trained to have those more business-focused conversations, but that takes time and resources. Until then, the agency owner will be the only one who can actually close deals.
3) Your Agency Looks and Sounds the Same
McLellan conducts multiple workshops per year for AMI, bringing together agency owners on topics such as finance, positioning, trends, and more.
Typically he starts with a simple prompt: Tell me about your agency.
The problem is that the 39th agency owner lists off the same words used by the previous 38 -- full-service, integrated, proprietary process, partner, experience, etc.
Don’t cling to the idea that being a specialist will limit your agency.
“When I look at the financials I can separate agencies into two groups: Those that are rocking it, and the agencies that are really struggling to make payroll. The difference is the ones that have differentiated themselves in some way are more profitable than the generalists,” McLellan said. “The generalists have to commoditize their rates and the work they do to compete.”
Because when generalists go up against other generalists, there’s nothing to set one agency apart from another. Most likely, any of the agencies in the running could do the work. So at that point, the only differentiation between the agencies is how much the work is going cost.
However, as an expert in a specific industry or tactic, you can place a premium price on your services.
4) You’ve Lost Your Swagger
“Agencies have gotten used to begging for work,” said McLellan.
This may be due to the recession and the broken down attitude from those that actually survived, but it’s time for agency owners to adjust their perspective. You need to enter a conversation with a prospect with the approach that you are vetting them and their fit as a client, just as they are vetting you.
One way to establish your authority and confidence is by asking tough qualifying questions, such as: How quickly do you pay your bills? If I need to get a hold of you, what are three ways that I can track you down to make sure that we get something approved?
Agencies need to believe in their expertise and their work. They need to be excited to compete because they are confident in their ability to win.
"Swagger attracts the people who are going to love your product, spend a lot of money, and rave about it,” McLellan said. “It also tells your current customers who you are and what you're about. It reinforces their buying decision.”
And there’s another even more important reason why swagger matters. It helps you keep bad clients out of your agency and away from your most important assets -- your team members. Competition for talented creatives and marketers is increasing. It’s unlikely that your most valued team members will stay in a position where hours are long, pay is less than on the corporate or even tech side, the creative work is client-driven, and they get bullied by clients on a daily basis.
5) You Violate the Client’s Secret Rules
There isn’t a course on how to pick an agency. So marketers go on their gut feelings, they talk to their marketing friends and ask for advice, and they develop their own systems for weeding out candidates.
AMI’s research found that many marketers have their own system for rewarding and weeding out agencies. In fact, 51% of marketers said they have a “secret sauce” that helps them vet agencies, and 46% said they have automatic disqualifiers.
And example of one of these disqualifiers is offering to discount your rates. If you are discounting before you’ve even won the business, the client is going to question how business-savvy and confident you are in your product and how well thought out your pricing is.
To combat this, just ask. Ask why the client would disqualify an agency? What do they value? What are the deal breakers?
Then, list your own. Tell them what you look for in a client, the type of relationship you want, and what would cause your agency to walk away.
Originally published Oct 26, 2015 9:00:00 AM, updated February 01 2017