With Q1 well in hand, business development pros continue to see and feel the effects of covid on their ad agency prospecting process. I spoke with an agency BD leader the other day who lamented that since the pandemic, she was connecting with only about 1% of the prospects she calls compared to 25% - 30% pre-pandemic. She said that change is likely the result of the time pressures that marketers have to deal with today because of staff cutbacks, hiring challenges, additional responsibilities, and shrinking budgets. And the same issues also impact the people (internal and external) and companies they rely on for other services. As a result, they must spend more time following up and juggling overbooked schedules, the time they didn't have to begin with.
She's not wrong about calling prospects. According to various 2021 and 2022 research, the success rate for cold calling is 1% - 3%, likely closer to 1%.
She's not wrong about hiring challenges. According to HBR, 2/22, …the talent issue will likely be the most vexing challenge in 2022.
She's not wrong about budgets. According to Gartner, marketing budgets as a percentage of company revenue fell to 6.4% in 2021 from 11% in 2020. We all know it takes more time to figure out how to do more with less or what to cut back on and the impact that has on everything else.
And if that isn't enough, a recent Salesforce survey says marketers expect a 40% YoY increase in the number of data sources they use, causing marketers to spend more time trying to make sense of all that data.
These are all actual cross-industry conditions impacting prospecting success today compared to last year and pre-pandemic. What can BD pros do in this kind of environment? If you are taking a business-as-usual approach, chances are you will see results declining despite having good success in the past. I see three trends worth paying attention to when considering how to approach the ever-evolving post-pandemic environment. If 2022 has not started out as expected, try these three things to calibrate your outreach and prospect journey efforts with an evolving, time-stressed target audience.
Time of day and day of week
Cold outreach, email, and phone have traditionally followed similar timing trends, peaking on Tuesdays, with Wednesday and Thursdays very close behind. Monday and Friday have performed significantly worse. Recent data indicates a shift from Tuesday to Wednesday as the peak day. I haven't seen any explanation as to why. When you consider the increased time demands and responsibilities that today's marketing decision-maker has, it now takes them until Wednesday to get through all the Monday fire drills, freeing up a little bit of time to respond to things that aren't the highest priority.
Past data suggested that Tuesday 7 am – 8 am was the ideal time to reach a prospect. New data suggests that has changed to Wednesday 4 pm – 5 pm, followed by 11 am – 12 pm. The worst time to call has been Monday morning between 7 am and 11 am. A recent survey shows that cold outreach success rates are 46% higher on Wednesdays than on Mondays.
Again, this is primarily anecdotal, and further testing and analysis need to be done. Agency BD leaders should adjust outreach schedules and monitor the results to find the most effective time and day. With so much changing and new data trickling in, it's best to take a test and learn approach and see if you can improve your results.
Virtual and self-serve tools
The B2B market saw significant changes during the pandemic across industries. There are good survey data about the evolving behavior of B2B buyers that BD leaders should pay attention to and consider how they might apply to agency prospecting.
McKinsey found that 70% - 80% of B2B decision-makers prefer remote human interactions or digital self-serve. The main reasons are ease of scheduling (time pressures), savings on travel expenses (budget cuts), and safety (covid impact).
Bain & Company says that 92% of B2B buyers prefer virtual sales interactions, up 17 percentage points from May 2020. 79% of B2B sellers agree, compared to 54% in 2020. Sellers say that virtual selling can yield three big benefits: faster and more frequent communication with prospects, more cost-effective interactions, and the ability to scale interaction with more opportunities.
It is also important to note that the buyer journey is evolving. Bain points out that 19% of B2B buyers have determined their vendor selection criteria, 43% know which vendors they want to talk to, and 38% have a preference or have made a vendor decision in mind before contacting a company. Buyers spend more time exploring, shortlisting, and vetting potential new vendors before they raise their hand. The same is true in my experience for marketers looking for a new agency. Buyers don't want to talk to anyone until they have done their homework.
According to Tom Spitale in Forbes Agency Council, Pfizer is cutting its US sales force despite record sales. Pfizer's cuts are driven by the most important data in business: evolving customer needs. The company "expects doctors and other healthcare providers to want fewer face-to-face interactions with salespeople." Not fewer interactions overall, but fewer face-to-face interactions as meetings move to a virtual format.
As we watch this trend play out in all other areas of B2B sales, agency leaders should consider ways to adjust their approach and content to the changing behaviors of their prospects. The customer journey plays an increasingly important part in the agency search process. In that journey, self-serve content that satisfies the marketer's needs in their early research, not just capabilities and case studies, can serve a beneficial and differentiating role. Interactive and AI-driven content that can reduce guesswork and subjective interpretation during the research process could enhance the experience. Simple navigation to more content and curating the right content based on needs will help ensure that the marketer gets the fullest, most complete understanding of the agency before any personal interaction occurs.
Video and yes, Chat
According to McKinsey, B2B organizations have increased their use of video conferencing from 38% to 51% and online chat from 40% to 49% in 2021. I'm sure these numbers have increased as 2022 rolls along. Survey data shows that 77% of B2B buyers who meet new suppliers and vendors prefer video conferencing over phone calls. Every agency I've talked to agrees; however, not every agency has or is taking steps to optimize the prospect experience in that conference. Agencies should seek training and do critical postmortems to improve their on-camera storytelling skills to make the best impression.
Live chat has also emerged as a valuable tool. Recent surveys indicate that more B2B Customers prefer to interact via chat. Is it appropriate for agencies? In B2B, live chat is now the number one rated channel businesses use when researching suppliers. Interaction with a sales representative through live online chat is up 23% since the start of the pandemic. It makes sense for products or services that are more technical or differentiated by product-feature decisions. Does it make sense for agencies, or could it make sense if executed right?
The benefit has merit considering the convenience of self-service and self-directed research to alleviate the challenges of scheduling a call or meeting. When you consider AI, machine learning, and natural language processing methods to interact with website visitors any time, day or night. A few simple questions can direct visitors to key content and web pages and qualify prospects without involving anyone. It is tricky because agencies want personal interactions believing that they do best when building one-on-one relationships. But do marketers feel the same? Do they want to invest in a relationship before they have decided if the agency is a possible fit, especially in the very early stages? Some may, but the trends suggest others don't. Can agencies have it both ways?
In this period of rapid change, agencies also need to consider ways to utilize more video conferencing and video content in the customer journey and investigate how live chat can be a helpful tool in the customer journey. This is as much a creative challenge as it is a technical one, just the kind of thing agencies are built to solve.
What hasn't changed
High-growth agencies don't rely on prospecting alone to grow. In fact, during the pandemic, many shifted more time into networking for referrals and organic growth while maintaining a consistent level of cold prospecting. These three channels each contribute about 1/3 of new revenue every year in normal times. That percentage varies from agency to agency and year to year but are consistent revenue sources.
Activating your referral network and the networks of your leadership takes time and follow-up. You should consistently stay in touch regularly to remind and reinforce your agency's expertise and capabilities so that your network can clearly communicate to their contacts when appropriate. Remember, one of the first steps a marketer takes when investigating new agency resources is their network. Encourage yours to reach out and strategize with them about specific people they know who may be open to a new agency recommendation. And by all means, don't forget to ask how you can help them. The best networking is a two-way relationship. As some version of normal returns, agencies should recommit to aggressively working all three channels.
If you'd like help resetting your agency for new business success, let's talk. There's no better time than now to rethink and reset your business development program. I am always open to discussing your challenges and offering my opinion on possible solutions. If you like this post, sign up for my new business newsletter. Find me on LinkedIn for daily tips and insights. Feel free to reach out at any time. #LetsGrow!