A rhetorical question. What isn't a barrier? The pandemic's impact has reverberated through all aspects of the agency. From people to partners, payment to profit, and everything in between, the results are devastating. Many have eliminated or cut back on new business staff and budgets and have reduced other staff leaving little time or support for any new business efforts. It's counterintuitive, but what isn't in this current crisis.
That said, agencies are still winning new accounts. According to the latest reporting from Winmo, in the last couple of weeks, Main Event, Consumers Energy, Burton Snowboards, SalesForce, Canva, Binske, Coyote Outdoor Living, ShopRite, Gun Lake Casino, Aruba Tourism Authority, Shoe Station, Inspire Brands' Arby's, Sonic, Buffalo Wild Wings, and Jimmy John's, Coca-Cola, have hired new agencies. Not everyone is standing still.
These are the anomalies—the few lucky ones. For every win, thousands of companies and brands aren't spending, aren't changing, aren't taking meetings, aren't sure what the future holds. The companies who aren't doing anything far outnumber those who are, impacting at least five times as many agencies and vendors (pre-covid, companies worked with five agency resources on average). I spoke to one marketing executive last month who said she had reduced her agencies from five to two, and those two are hanging on project by project.
The good news is that brand spending is creeping back. At the pandemic's peak, 81% of large advertisers were deferring ad spend, 57% said they had decreased budgets significantly, while only 19% said they made no change. And these are the large ones. Medium and small advertisers and the agency ecosystem that supports them have had an even tougher time. Those who have digital expertise and capabilities have fared a little better. The latest data shows that digital spending is increasing and will continue as ecommerce outperforms everything else.
For agencies who haven't been on the equation's winning side, the near term is challenging. Although many CEOs, CMOs, sales, and marketing executives say that the fourth quarter and 2021 will be better, the impact will continue. Why? Because today the single most significant barrier to agency new business is the proliferation of companies and marketers who don't know what to do or have leadership, a board, or investors who won't approve what they need to do to bring customers back. "I can't think about restarting my marketing. I can't plan for tomorrow. All I can do is react hour by hour," said a marketing executive on a Zoom introductory call last week.
Business development pros have faced every barrier imaginable, but this one is particularly vexing. What's clear is that we have to double-down on adding value in the most basic ways. Marketers who can't see past the next hour are losing credibility in their organization, eroding trust, and diminishing their leadership role. In fact, there has been an unprecedented turnover in marketing over the past couple of months, likely a contributing factor. In good times and bad, marketers must champion the organization's mission and vision and promote it internally and externally to impact business success. Today, marketers must have a plan to contribute to the recovery, a strategy to regain momentum and solutions to solve even the toughest problems; otherwise, why have them around at all. "I can't even get time on my boss's schedule to talk about what's next. She's too busy going from the C-suite to the stores and back to operations and logistics trying to stop the bleeding." Marketers need help selling their ideas to panicked executives, but first, they need help developing those ideas.
Today's added value is that voice inside their head reorienting them back to the role they used to occupy – a champion of problem-solving. They need the courage and fresh thinking to go to management with a plan, with alternative ideas, what-ifs, and contingencies within their current resources' constraints to move the business forward, even inch by inch. Agencies willing to help, even without compensation, will be much better positioned when things turn around. A small investment of time and expertise can give the marketer a renewed sense of purpose, increase confidence, and show initiative. Helping them be the hero of the day could pay big dividends in the future.
Some brands are far ahead of the curve, but many more are struggling, caught up in reaction mode, uncertainty, lack of strategy, vision, and leadership. "Just keep doing what you can until management figures this out," is another marketing executive's mantra. And every week, a revised forecast comes out chronicling the downward trajectory. Too many marketers, rightfully so, are worried about being laid off or losing more staff and budget. They haven't the time, interest, or energy to consider a new agency, but they should. They need a voice of confidence – we know your business and your customer and how to triage your marketing plan to get back on the road to recovery. We are skilled at standing beside you to help sell your ideas across the organization, negotiate with any detractors, and get all stakeholders on the same page. We've got this and we've got your back.
Thanks to Winmo's Vulnerable Account Index, we also know which brands are more likely in panic or reaction mode, those who need a voice of confidence. The sheer number of big brands on the list means exponentially more smaller brands are vulnerable too. Brands such as, General Motors, shuffled executive marketing team, Humm Kombucha, named first CMO, HempFusion, named first CMO, NutriStyle, added first CMO, Everest, promoted first CMO, Remy Cointreau, searching for new CMO, Nutraceutical, CMO left shortly after new CEO hire, Subway, added chief operating, insights officer role shortly after naming new CMO, Pizza Hut, hired CMO, CBO, CEO, Kellogg, named global CMO, Dominos, promoted marketing head, Q Link Wireless, added CMO, UMass Boston, named new CMO, Infiniti, announced a creative review, Dashlane, named CMO and other marketing leaders, closed Series D funding, to name just a few of over 100 on the VAI list and growing. If you aren't a Winmo subscriber, click here.
The biggest barrier to new business today is uncertainty. The opportunity is pretty clear for brands who are struggling, changing marketing leadership, hiring new CEOs, and vanishing from the advertising radar. The challenge is to break through and get them to listen. And, that is a tough challenge. With the right approach and right message, you can. Others have. I have. In this environment, industry experience, audience experience, business experience, and confidence are needed most. Identify the ones who line up best with your agency and go get them. They need your help.
Good luck, and stay resilient!
These are uncertain times, yet no better time to rethink and reset your business development program. I am always open to discussing my favorite subject – ad agency business development. If you like this post, sign up for my new business newsletter. Find me on Twitter and LinkedIn for daily tips, observations, and insights. Feel free to reach out at any time. #LetsGrow!