Yes, the year is over and it's time to reflect on how we all did. It’s time for everyone to turn their gaze to the new business warrior and ask those piercing questions. Is new client revenue up? Did you hit your forecast? Did we get the hourly rates you promised? Do we meet our strategic goals? Are you excited about your annual review? Will you even have an annual review? A bonus check? A pat on the back or a pink slip? Yes, once again, it's year-end in Adland.
Was this year average
Every year we ask ourselves the same questions about new business, and it seems like every next year history repeats itself. The average ad agency win rate of 25% - 30% has not changed much over the last 10 years. But who wants to be average? New business should be a combination of doing, reviewing and evolving, not just the doing. Hitting the numbers is dependent on many factors across the agency, some, of course, specific to the process and others related to what the agency is and does, and doesn’t do. All too often, we only focus on the results, and that is short-changing agency growth.
Don't rely on a personality
Having an overall framework to measure the macro and micro factors is important. Each event along the way should be recorded and analyzed as a scorecard for the new business process. But then what? Agencies often rely only on a person and a personality to achieve results. I hear this kind of feedback often, she is very good on the phone, he is great at striking up a conversation, she knows the right questions to ask, he is very friendly and engaging. Ok, these are all good qualities but not the most important aspects of new business success. If the food doesn’t meet the diner’s expectations, it doesn’t matter how good the waiter is.
It is easy to count wins and loses
It is hard to understand why one is a win and the other a loss. All too often we don’t put in the effort to understand why but rather conclude it must be the new business person’s fault and end up firing them. Industry statistics prove that new business people last only 18 months on average. That fact alone shows that many agencies believe new business is a personality game. If the results aren’t as expected, get another person. When I ask marketers why they did not choose an agency, I never hear them blame it on the new business person. In my experience, over 75% of the potential new revenue is lost for reasons other than a new business person’s performance.
Understanding the “why” is hard
It takes honest retrospection, deep analysis, and objective scrutiny to get to the why. It’s much easier to ignore the underlying issues and push for more calls, more meetings, and more prospects. It takes far less time and effort to add up the calls and say, it’s not enough. But really, how do you know it wasn’t enough? Conventional wisdom says more is better. There is a whole industry of resources to do more calling and more spamming. There are situations where this methodology works, like timeshares and used car warranties, but not in the agency business, not today, not if you want a growing portfolio of great, profitable agency-client relationships. If you think to throw more bodies, more hours, and more activities into the battle are the answer, you will only end up with more casualties in the end.
Numbers are important, but
Don’t get me wrong. Numbers are an important aspect of a successful new business plan. But not the same numbers you would expect when selling a Chop-o-Matic on QVC. In fact, ask any agency leader with a great new business record and they will tell you that having fewer numbers but more meaningful interactions are the key to more business. Getting to the “why” in order to have fewer high-quality conversations is a far better solution than doing the same thing over and over, swapping out new people every 18 months just to find little has changed.
So how do you get to the why?
Here are seven things you must do next year.
1. Always schedule a postmortem with the prospect. Never accept no. Your agency invested an incredible amount of time, money and passion in the pitch and the prospect owes you a meaningful conversation in return. And don’t let them be polite. Get to the real issues and keep digging until they come clean. You are defending your $10,000 - $100,000 investment in their process. You should be relentless at getting that much value back through meaningful feedback.
2. Always schedule a postmortem with your agency. Everyone needs to know what went well and what didn’t in an open and honest way without being personal. Don’t walk away without an action plan to make the next one better. Eliminate internal process issues from the why.
3. In every new business conversation, phone call, meeting, email exchange, always ask the prospect what you are missing that they are seeking, what doesn’t fit with their need, and how you compare with the others they are talking with.
4. Analyze your site traffic. 90% of interested prospects visit your site first. What content are they looking at and where do they leave. Test simple ways to get them to the next page or give them something to linger on. And don’t just look at the raw numbers. Devise ways to separate prospects from 90% of your traffic that is looking for a job or looking to sell you something. Don’t get caught analyzing people and things that will skew your data so you can focus on why they stayed to learn more.
5. Constantly rehearse your elevator speech, your positioning framework, your value proposition and your presentation with people outside your walls. It may sometimes be hard to hear negative comments, but I’ve gotten immense value by suffering through feedback from the most unlikely sources. Be humble and learn. Be confident your offer is understandable and makes sense so that when it doesn’t connect you know why.
6. Look carefully at your timing. Time of year, month and day to be most effective. Look at your prospect’s timing, budget cycles, market events, and agency longevity. And look closely at your time between contacts. Statistics show that a follow up within 30 minutes is far more effective and memorable. After one day, you are long forgotten and a dozen other agencies have stepped in. Make sure your timing is right to eliminate it as a source for why.
7. Always arm yourself with value and relevance before a conversation. Presenting your agency as the one who can solve their problem is not much value. Do your homework and know specifics such as last quarter’s results and how you might turn things around. Or, discover that the prospect is on the board at the children’s hospital, and your agency does pro bono work for children’s cancer research. Do your research and make the conversation relevant and valuable and in return, you will understand if it is a good fit or not by the quality of the conversation.
Remember in Adland, NO is just the beginning of a conversation. Don’t stop until you find out why you did not win, share it with the team and then work on ways to fix the problems or decide that you shouldn’t be going after that kind of prospect and pivot. When the NO turns out to be right, move on. You are 75% more likely to win the right ones and only 30% likely to win just anyone.
Count the numbers, all of them. But also do the hard work, the things that really make the difference in your success next year. "Change before you have to." - Jack Welch.
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!