Agencies need new clients to survive and better clients to thrive. That's it. No need to read further unless you aren't sure what the right approach is for your agency.
There are two general approaches for ad agency growth. The first and most common is to prospect the highest number of potential leads as possible to find the few who are looking to buy at that moment. This method is survival mode. The second is to prospect the least number of potential leads to win the few new clients you really want. This is thrival mode. Wait, did I just invent a new word? Either has vastly different implications for the agency and require different strategies, processes, people, and resources. If you get it, move along.
Greatest number of potential leads
The critical requirement for this approach is to work with a big list. Getting that list is a challenge and maintaining it is an even more significant challenge. You can buy or rent lists or compile your own. List quality makes a big difference in the time spent on bad leads, incomplete data, and additional research. Don't underestimate the effort needed. Regardless of how you get your list, it's crucial to select prospects who fall within your agency F.I.T. criteria to be sure you spend time on the right opportunities.
The second difference is staffing requirements. A single BD person with mid-level experience can efficiently work a finite number of prospects a week. Your mileage will vary, but you'll want a high energy hunter for this approach who will spend as little time possible on as many leads she or he can manage. The variables of capacity include what the person is capable of, research and preparation time, development of collateral or other support, and analytics and reporting, and the many other agency distractions that sideline their work. A marketing automation platform helps, and I've got some recommendations if you are interested. But don't expect this tool to drive the process. It is only a tool, not a solution.
The pros and cons of this approach, you'll need to spend a lot of time developing and maintaining a large enough list to make the formula work. You'll need more bodies to achieve the numbers (emailing, calling) necessary to make the percentages work. If you have the people and capacity, you will see new business results. It's a lot like playing Whac-A-Mole. If you can keep up, you will score.
As time passes, keeping a large enough pool of prospects will become increasingly more challenging, and you'll likely have to evolve and shift your prospect criteria. Statistically, the numbers can work in your favor and do work for many companies across industries. The key is the disciplined management; x many calls per day, x many emails per week, x many meetings per month equals x many new clients. As time passes, you'll get reasonably predictable results but only if you stick to it. Consistency is the key.
Sales statistics from a variety of sources show that this methodology is declining in effectiveness. Response rates across the board are falling. Prospects are employing better techniques to shield themselves from an increasing number of solicitors. Despite the trends, this approach remains the most common practice because it has proven to be successful and is the most tangible way to correlate your actions to results.
Least number of potential leads
The defining element of this approach is a smaller list of strategically targeted and more desirable prospects. Compiling a high-quality list requires extensive research using precise criteria about which companies and which prospects match the best with the agency. Maintaining the list is less challenging because the requirements are well-defined. You aren't likely to buy or rent such list because the conditions are unique to your agency unless you spend a lot of money on a custom list.
The objective is to define the companies and brands that you want to work with, those that will move the agency toward its long-term goals, and of course, have the highest potential for profit. The list is what makes all the difference. Most, regardless of what approach they take, will tell you they use strategic criteria for the right prospects. In truth, the lists I see are not very good. The time and effort spent on research are critical at the start. The right agency F.I.T. criteria is also essential to ensure precious time spent on the best prospects. And, it is equally important to have the courage to say no to opportunities that don't fit the criteria.
Staffing requirements are also a factor. Like the previous approach, a single BD person with mid-level experience can efficiently work a finite number of prospects in a week. You'll want a strategy-minded hunter-gatherer, someone with patience and perseverance who can spend adequate time on each prospect. Capacity depends on the person, the extent of time spent on both professional and personal research, collateral and other support, analytics and reporting. A marketing automation platform helps, but it is only a tool, not a solution.
The pros and cons of this approach, it will take longer to develop, nurture, and see results. When you consider that the average agency-client relationship lasts about three years, the time required to engage, build a relationship, and position the agency successfully occurs within a potentially long sales cycle. Over time the right opportunities will become more frequent and predictable as your efforts become synchronized with the need cycles of each prospect. While this approach is measured in the same way, it is less dependent on quantity since the quality of each metric drives the process.
The hardest part is staying disciplined and focused on the goal. It requires a commitment to the long game and the ability to pass on those attractive opportunities that aren't within your precise criteria. And, it needs a steady, consistent and patient work ethic, something that is difficult to maintain throughout the ebb and flow of agency business.
Why not do both
In my opinion, a combination of both is best. An agency should dedicate about thirty percent of BD time to capture desirable opportunity in the moment and the rest pursuing those targeted clients that are strategically aligned with the agency's long-term vision. You could start out with the percentages flipped and work toward the right balance however a blend of automation and highly targeted prospecting can enable you to do both. The extent to which you can depends on how much you invest in people, technology, and time. Agency leaders have to decide the right blend to keep the lights on while moving toward their long-term goals.
Prospecting is just one channel. The healthiest agencies gain new clients and new revenue from three sources – prospecting, referrals, and organic. Surprisingly, too many focus all their time and attention on prospecting, which is the toughest channel of all.
I’ve got a lot more advice on how to make 2018 a better year for your agency and would enjoy talking about your specific needs and goals. If you like this post, click the thumbs up, so I’ll know and then sign up for my new business newsletter. Follow me on Twitter and LinkedIn for daily tips, tricks, and insights. #LetsGrow!