I remember one Saturday morning when my young daughter asked, Daddy, where do advertising agency clients come from? Of course, I blushed and said, ask your Mother. And then I realized, what a great question.
Some say it’s the stork. Others, the Lead Fairy. And a few claim everywhere and anywhere. The source of leads is one of the most confounding and perplexing challenges for many agencies and yet is vital for survival. As a business owner, you and or your staff must be experts on lead sources for the survival of your agency and for your Daughter, should she ask. Knowing what your best sources are will allow you to maximize your limited time and effort on business development, increase your success rate and put more money in your pocket.
So, where do new client leads come from? My experience in agency business development has been consistent over the last 15+ years. About a third comes from prospecting, a third from agency networking and referrals and a third from organic growth. Of course, there are plenty of exceptions and wide variances. However, the point is, if an agency isn’t looking at all three sources they are leaving opportunity on the table.
I recently fielded a survey among 156 small, medium and large agency owners and business development pros. About 83% reported to be full-service, and 61% handled both B2C and B2B. One of the questions in the survey was this very subject. It certainly isn’t scientific but interesting nonetheless. In full disclosure, there are other better sources of data like the Agency Management Institute and RSW/US that you should look up as well. I fielded this survey in October to gauge current practices and plans for 2106.
The survey has a variety of questions. However, this one question alone offers a wealth of insight for agency owners. First, who wouldn’t want to be these agencies?
- 2% get ALL of their leads from outbound prospecting
- 1.5% get ALL their leads from referrals
I can only imagine a new business engine that drives 100% of leads through prospecting or referrals. For the rest of the agencies, the answers are closer to my experience.
- 40% get only about a tenth of their leads from outbound prospecting, 28% get about 1/4 and 17% get none. 15% of agencies get half to all of their leads from outbound prospecting.
- Almost half get a tenth to a quarter of their leads from inbound sources, 44% get half to three-quarters. That is an awesome number and proof of the effectiveness of inbound marketing. Content, content, content!
- It is important to note that almost no agency (except the two percenters) is getting leads from prospecting alone.
- 68% find about one-tenth to one-quarter of their leads from referrals and 31% get half or more. I’ll bet you wish you worked those referrals harder.
- 72% of agencies get one-tenth to one-quarter of leads from networking, and 21% get half or more. We all hate those social events with rubber chicken lunches, but it appears the torture pays off.
- 70% get one-tenth to one-quarter of leads from organic growth, and 27% get half or more. Surprisingly, many agencies don’t have a comprehensive or consistent organic growth strategy in place.
Where do you fall in the mix? In and outbound marketing is the most talked-about area of agency growth. There are so many resources dedicated to this channel – consultants, cold callers, appointment setters, and more focused on finding a lead and exploiting it. But prospecting isn’t the only channel that agency owners should be tending to. If you follow my rule-of-thumb, 1/3 of your growth will come from in and outbound prospecting, that means 2/3 of your growth may be ignored or worse, lost to other agencies.
I authored this survey because I help agencies grow. I have over 15 years of experience as an agency new business pro and chief marketing officer but want to benchmark my experience with other agency leaders. If you are not happy with the success of your new business efforts or if you feel like you are leaving new business revenue on the table, I would enjoy learning about your experience and sharing mine. After all, new business is the future of every agency. #LetsGrow!
Download the Survey Results
I’ve got a lot of advice on how to make your business development efforts more effective and would enjoy sharing what I know. If you like this post, click the thumbs up, so I’ll know and then sign up for my new business newsletter. Find me on Twitter and LinkedIn for daily tips, tricks, and insights. And, please share your new business advice, successes, and failures. #LetsGrow!