By Category: New Business for CEOs
Identify the best talent
by Todd Knutson | published on May 05, 2011
Most CEOs agree that one of their most most important jobs is to identify talent. When I think about talent I often recall a "Corner Office" interview in the New York Times with Kip Tindell, CEO of the Container Store.
Here's the paragraph that's stuck with me:
One great person could easily be as productive as three good people. So we try to pay 50 to 100 percent above industry average. That's good for the employee, and that's good for the customer, but it's good for the company, too, because you get three times the productivity for only two times the labor cost.
I can easily see how this applies in a retail environment, particularly if you're talking about the difference between a minimum wage employee and one paid double that. My question is, does this apply to ad agency new business?
I think it can, if you - the CEO - focus on identifying the best talent.
- Let's say you're thinking about creating a new business team out of existing account service personnel. They're all likable and gregarious; everyone thinks they'll do great. Their all-in cost is $50,000 each, including salary and benefits. They don't know much about sales, but have some knowledge of the various industries you have expertise in. They're young and eager, and relatively inexpensive, so you're okay giving them a chance to show what they can do.
- On the other hand, you have a prospective external candidate who will cost you $100,000 a year. She has worked at two different agencies over the last ten years, and has demonstrated her ability to work in related industries, has good sales skills, and can orchestrate a pitch.
Who do you hire?
Sure the external candidate is twice as expensive as any one individual candidate, but will she be three times as productive? I'd say she will, and perhaps in ways that you wouldn't even think of.
For example, many less experienced new business people will spend inordinate amounts of time researching a long-shot prospect. They'll argue that they need this information so they can relate to them once they get them on the phone. On the other hand, the more experienced person will quickly and efficiently do the research to identify potential business issues they're facing, and will then pick up the phone, engage the prospect with relevant questions and concise insights that reflect your agency's capabilities.
Good sales people are hard to find: most employers I know tell me that their success rate on new sales hires is 1:2 (best case) and 1:4 (worst case). So, if you go the "hire three" route, you're most likely to end up with one who's good. So, your decision really is between promoting one good person (but you don't know which one), versus hiring one proven, great person.
I'd go with experience and proven results and productivity every time.
What do you think? Do you believe in Mr. Tindell's approach?
Growth, incentives, accountability
by Todd Knutson | published on May 04, 2011
It's not every day that you get to see John Wren, Michael Roth, and Sir Martin Sorrell on stage together. At least I don't. One thing's for certain, when you do see them together you'll realize there's no shortage of ego on stage!
These three are smart guys, and as I expected, after listening to them recently I came away with ideas that apply to most ad agencies. And, as new business is always tied to the strength of the agency, if you implement their recommendations, you'll impact your new business effort.
Recommendations for agencies from The Big Three:
Keep pace with new technology and new media
Spend more on attracting and retaining talent
Use data and analytics to generate consumer insights
Focus on your people
Reflect your market in the diversity of your team
Implement a compensation model that reflects where the growth (new business) is, with financial incentives to match, and accountability
As you can imagine, when asked about agency-client relationships, they had lots of opinions. I thought the best were four things clients can do better:
Praise more, express appreciation
Encourage your agency to take more risks
Don't try to take the last $5 out of my pocket
If you kick your agency like a dog, you won't get good work
I'm sure you can add a few more to this list, but this is a good start.
Are you training?
by Todd Knutson | published on April 27, 2011
McKinsey & Co. managers spend thirty days per year training and evaluating their people. In contrast, agency managers spend two. Given that consulting companies like McKinsey are encroaching on turf that has historically been the purview of ad agencies, what does that say about the future...?
We use the excuse that we don't have time.
The reality is, we aren't taking our own advice - the advice we give to clients every day, said Andrew Benett, Global CEO of Arnold Worldwide at the recent 4As Transformation conference. He conducted a survey of 3,000 people at all levels in all types of agencies. This is what he found:
- 30% of employees said they'll be gone in 12 months
- 70% will call a recruiter back
- 96% are confident that they could easily get a new job
"We accept that an employee will be with us for just a few years."
- 30% think they'll be with your agency for < 1 year
- 37% think for between 1-5 years
- 35% for > 5 years
Other alarming statistics:
- 70% believe they need to take care of their own careers
- 60% would leave for better compensation
- 43% answered that "employees" are most important in their agency.
- 50% feel there is no career path
This latter point is critical. Employees want the ability to learn, and the ability to be creative. If your agency can't give them this, they will move on.
It's not a factory, it's a garden. Adjust your paradigm.
Less than 10% of new employees come from referrals. In other industries, it's 50-60%. Bottom line, says Benett, the ad industry is not promoting itself. For example, "We are no-shows on college campuses."
Five steps to get the ad industry moving on talent:
1. Go back to school.
- Commit senior management time to train
- Partner with universities; go beyond career services
2. Promote cross-training
- Share training sessions
- Encourage reverse mentoring
- Offer employee exchanges
3. Introduce new incentives
- Offer paid sabbaticals; education reimbursement; relocation
- Offer support to families
4. Fix performance management
5. Engage employees in the conversation
- Solicit ideas; listen
- In the decision-making process
What do you think? Will these ideas work?
by Todd Knutson | published on March 23, 2011
With Salesforce.com's acquisition of Jigsaw, you can now easily export contacts from Salesforce.com to Jigsaw. (For more on crowd-sourced data sources like Jigsaw, click here.)
However, ad agencies, as well as any other Salesforce.com user, must now recognize the significant intellectual property issues presented by this merger. Most importantly:
Whose contacts are in your current Salesforce.com account, or your internal database?
Do you have the right to export these contacts to a third party? If so, under what circumstances?
May that third party sell them?
This is important as your agency may be opening itself up to potential legal liability. Consider:
If you export contacts, purchased from a third party, into Jigsaw, what is your potential liability for violating the third party's license agreement?
If you import contacts from Jigsaw that belong to a third party, what is your legal liability for doing so?
Here are extracts from the license agreements of popular providers of new business prospecting information to ad agencies:
You are specifically prohibited from: (a) using or permitting the use of Information to prepare an original database or a comparison of the Software to other databases that are sold, rented, published, or furnished in any manner by or to a third party; (b) using or permitting the use of Information for the purpose of compiling, enhancing, verifying, supplementing, adding to, or deleting from any mailing list, business directory, or other compilation of information that is sold, rented, published or furnished in any manner to a third party.
The Content on this Web site is for use by the Subscriber and its Users only and not for commercial exploitation. A User may not decompile, reverse engineer, disassemble, rent, lease, loan, sell, sublicense, or create derivative works from either this Web site or its Content. A User may not use any network monitoring or discovery software to determine the site architecture or extract information about usage, individual entities or users. A User may not use any robot, spider, other automatic software and/or devices or manual processes to monitor or copy this Web site or its Content without the Provider’s written consent. A User may not copy, modify, reproduce, republish, distribute, display, or transmit to third parties outside the User’s agency network for commercial, non-profit or public purposes any or all portions of this Web site without the Provider’s written consent. A User may not use or otherwise export, or re-export, this Web site or its Content pursuant to the export control laws and regulations of the United States of America. Any unauthorized use of this Web site or its Content is expressly prohibited.
Redbooks (Lexis Nexis):
The Content on the Site is provided solely for your personal use and not for commercial exploitation. You may not decompile, reverse engineer, disassemble, rent, lease, loan, sell, sublicense, or create derivative works from the Site or the Content. Nor may you use any network monitoring or discovery software to determine the site architecture, or extract information about usage, individual identities or users. You may not use any robot, spider, other automatic software or device, or manual process to monitor or copy our Site or the Content without our prior written permission. You may not copy, modify, reproduce, republish, distribute, display, or transmit for commercial, non-profit or public purposes all or any portion of the Site, except to the extent permitted above. You may not use or otherwise export or re-export the Site or any portion thereof, the Content or any software available on or through the Site in violation of the export control laws and regulations of the United States of America. Any unauthorized use of the Site or its Content is expressly prohibited.
The Services are licensed for Customer's internal use only and subject to any restrictions set forth in the Order. Customer will not provide Information, or other Services to others, whether directly in any media or indirectly through incorporation in a database, marketing list, report or otherwise, or use or permit the use of Information to generate any statistical or other information that is or will be provided to third parties (including as the basis for providing recommendations to others); use or permit the use of Information to prepare any comparison to other information databases that is or will be provided to third parties.
As you can see, if you've purchased information from one of these third parties, and have exported or plan to export it to Jigsaw, you are clearly violating their license agreement(s). For these third parties, the natural next step is legal proceedings. It remains to be seen if it's against Salesforce.com, their clients, or both.
My recommendation is to go back and re-read the applicable license agreements - your legal obligations - if you've purchased data from a third party anytime in the last few years. And then, be very careful to document what you export to Jigsaw, if anything.
Better yet, just don't do it.
From classroom to workplace
by Todd Knutson | published on September 21, 2010
How do you build team players? Is "team play" something that people are born with, or is it a learned behavior? How do we create it in this Millennial age, when our youngest employees have grown up hearing that 'everyone is a winner', even though in business there are winners and losers?
I recently read Randy Pausch's The Last Lecture. At one point he talks about a feedback system that helped the students in his "Building Virtual Worlds" class at Carnegie Mellon University learn how to operate effectively in teams. It occurred to me that this might work for creative, account, and perhaps even new business teams.
Here's how he did it:
First, he created four-person teams. Each person was dependent on the work of the other three members of the team, and their grades reflected it.
Next, he would ask each team member to evaluate the other three members of the team three different ways:
- How hard did this person work? Exactly how many hours do you think this person devoted to the project?
- How creative was his contribution?
- Was he easy or difficult to work with? Was he a team player?
There were five projects each semester, so each student ended up with 15 data points. He always found the answer to number three the most compelling:
What your peers think is, by definition, an accurate assessment of how easy you are to work with.
Randy then stack-ranked the results in a horizontal bar chart showing each student's scores. The results were hard to ignore.
He also asked for free-form suggestions for improvement for each student. When coupled with the chart, each student had numerous examples of their behavior in action, with suggestions on how to perform better in a team.
How might such a simple system work within your creative department? Account service teams? New business or pitch teams?
Most important things entrepreneurs have learned
by Todd Knutson | published on September 14, 2010
Readers of this blog will recognize that I'm curious about how to improve new business, and business in general. I believe you can learn from the experience of others, particularly when you think of "experience" as the lessons learned from mistakes. This post shares 17 "words of wisdom" from the 2010 Inc. 500. (Find this list and those quoted here.)
- Get in over your head.
- Before you build the product, write the ad.
- Focus on simple things like profitability and execution. You don't need to come up with the next Facebook to create a successful business.
- Keep the main thing the main thing.
- You will be remembered for how you deal with the ups and downs.
- Failing gracefully is much more important than succeeding.
- Surround yourself with great partners and share the rewards.
- Hire slow; fire fast.
- It's a lot harder to repair a train while it's rolling down the tracks, so get everything set up before you build momentum.
- Systems run the company; people run the systems.
- It will take four times as much work as you expect but be 10 times more rewarding that you can imagine.
- There is always a solution.
- You cannot do everything yourself.
- Without knowing where you are at all times financially, you are destined to fail.
- Never confuse a consultant with a partner.
- At its founding, a business is victim to what you don't know; at adolescence, it's victim to what you think you know; and as it matures, it's victim to how willing you are to hand the reins to those more qualified.
- You don't lose until you give up.
Which ones resonate with you?
Execute well for growth
by Todd Knutson | published on August 11, 2010
Jason Fried and David Heinemeier Hansson, authors of REWORK, write: "The original pitch idea is such a small part of business that it's almost negligible. The real question is how you execute."
How you execute your business is critical to new business.
Think about it: How successful will your new business machine be if you have an account management team that continually fails to meet client expectations? If they're missing deadlines, promising one thing and delivering another, dealing with situations poorly, or communicating ineffectively, you're in trouble. I'm sure you've experienced all of these, and can add to the list of ways to cripple a client relationship.
Equally threatening - what if your creative work is weak, off-target, or doesn't meet expectations? Let's say you really need a win to avoid agency layoffs. So, your new business team dusts off work done by a prior creative director. It was award-winning work, "done by the agency", so you're okay with it. However, deep down, you know your creative team isn't as strong as it was. The good news: you win the business. The bad news: you can't deliver on the creative expectation you've set, so you lose the client in six months, trashing your reputation along the way.
In both scenarios, you failed to execute and consequently lost the opportunity to generate new business.
The opposite will be true if your agency is a "well-oiled machine". This represents good execution.
- Your new business efforts portray your agency as it really is.
- Your account management team continually exceeds client expectations.
- Your creative team regularly delivers work with "stopping power".
- Communication up and down the two organizations is consistent and effective.
What happens? Most likely, you'll be rewarded with organic growth on existing accounts. That growth will create confidence - that "swagger in the step" that non-verbally communicates to prospects that you're an agency to consider.
And they should, because you back it up with results. You execute your business well.
Sparkfly personalizes offers to influence shopper behavior and drive maximum margins
by Todd Knutson | published on July 14, 2010
One of the "if only we could" wishes of B2C Chief Marketing Offers is delivering highly personalized, one-to-one offers to customers - offers that result in increased brand loyalty and higher profit margins. I've come across a company that now delivers on that wish.
This is a way for your advertising agency to bring new technology and significant value to your current clients.
Here are some of the technological innovations now taking place in the sales promotion industry:
- Personalization is now possible in real-time - while customers are present in-store.
- Retailers are focused on customer loyalty and retention more than ever before.
- Personalization tools and processes are being integrated at the Point of Sale (POS).
- Post-promotion analysis can now be done in hours, not months.
Technologies that integrate real-time promotions into the POS deliver:
- Much better customer targeting
- Much higher redemption
- Tighter segmentation
- Greater market share
- Reduced traditional media spend
- Revenue gains
According to a white paper published by Retail TouchPoints,
The new paradigm makes possible a 1:1 relationship between seller and buyer that was inconceivable a few short years ago.
Besides new technology, what makes all this possible is that "the consumer is absolutely willing to sign up for personalized loyalty and rewards programs on the Web", says Sahir Anand of Aberdeen Group.
According to Retail TouchPoints, Sparkfly has "emerged as a leader in the transformation of existing POS systems, smarter CRM data integration, and a vastly improved consumer experience."
Sparkfly CEO Catherine Tabor adds this tantalizing summary of her company's solution:
Imagine a world where you know exactly which of your products an individual consumer is purchasing; when and where they're purchasing; and based on that behavioral purchase history, you can then communicate a very tailored and personalized offer to the individual consumer that will drive them back into the store, the restaurant, or to your product, at no incremental cost.
Without mentioning the Fortune 100 companies that Sparkly is now working with, after visiting the company's offices and seeing their clients' results, this may be a technology you want your clients to implement. It can and will benefit them, their customers, and further solidify your relationship.
It's tough to improve if you don't know how you're doing
by Todd Knutson | published on June 29, 2010
How do you measure the performance of your new business team? Is it just number of wins and revenue generated? If those numbers are good, do you know what they're doing well? If those numbers aren't good, do you know where they're falling short?
If you consistently measure the right things, you'll have all the information you need to hire, fire, train, and retain a high performance advertising agency new business person or team.
Measuring how you're doing is only effective if you're measuring against something. You first need to set an annual goal for each item. Then, break the goal down into monthly increments, and if appropriate, weekly and daily. With the goal, you can then measure your performance against your target. In addition, you want to measure yourself against how you did for the same period last year, and perhaps last quarter.
Social media: On your blog, measure followers against your goal. Review posts that get the most reads (and be sure to write more of them). Identify which ones don't get read and adjust accordingly. Track how many reads you get per day and per week against your goal. Identify steps to improve reads based on how they're trending (up or down). Measure traffic sources - where does your traffic come from - and track it against plan.
Events you host: How many guests do you expect to attend; how many show - that's the show rate, which you need to predict future attendance. How much did the event cost? What's the event's cost per attendee? How many new business meetings do you get from each event? What's the event's cost per new business meeting held? How many pieces of new business do you win as a result of an event? What's the cost per new account landed? Over time you'll have enough numbers to evaluate whether to continue hosting events or perhaps to increase the number of events, and it'll be based on a true ROI.
Events that you attend: What's your cost to attend? How many new business meetings do you secure from each one? What's the event's cost per meeting held? How many pieces of new business do you win as a result of each event? What's the cost per new business account landed? Over time you will have enough numbers to evaluate whether to continue attending certain events and perhaps if you should increase the number of events you attend. That decision will also be based on a true ROI.
Branding Email: If you use email as a branding vehicle - measure how many emails you send with each blast. What's the overall cost per blast, and per email? How many opens do you get? What's the cost per open? How many inquiries do you receive? What the total cost per inquiry? What new business do you win from emails? What's the email cost per new business account landed?
Branding/direct mail: If you use direct mail as a branding vehicle - measure how many pieces you send with each mailing, and the mailing's total cost. What's the cost per piece? How many inquiries do you receive (if any)? What's the cost per new business inquiry received? What new business do you win from direct mail? What's the direct mail cost per new account landed?
As you can see, if you measure all of your marketing activities, you'll soon have metrics on the marketing cost per new business inquiry, per new business meeting, and per new account win. This is incredibly valuable information for your future planning.
Networking / referral program: If you employ a networking and/or referral strategy, how many meetings or requests does it take for you to get one referral? How many new business meetings do you get for every 10 referrals? How many of these turn into new clients? You want to know these ratios so that you can determine how many referrals it takes to generate one new piece of business. Then, you can extrapolate and plan for the future.
Search consultants: If part of your new business strategy is to keep in touch with various search consultants, I encourage you to track your efforts and the ROI. How many consultants do you keep in touch with? How often do you do so? What does it cost (in terms of time, travel expense, mailings, etc.) to stay on their radar? How many RFPs do you get from them? How many do you respond to? How many do you win?
RFPs: How many RFPs do you receive (separate from search consultants)? From whom? Be sure to track the source of each RFP (i.e. how did they hear about your agency) so that you can better target your future marketing efforts. Track the cost (in terms of time, out-of-pocket expense, mailings, etc.) to submit an RFP. How many RFPs do you get from each source? How many do you respond to? How many do you win? What's the cost per submission? What's the cost per new account won?
Directories: Many agencies submit their creative work and other information to websites that cater to corporate marketers. You should measure these sources as well. Capture the cost of each directory, the number of times your profile is viewed by a corporate marketer, and the conversations, meetings held, and new client wins from each directory. Then, calculate the cost per profile viewed, per new business conversation or meeting held, per account won, etc. This way you'll be able to evaluate whether the particular directory you choose is providing you ROI. [Note: some of these sites may be considered "branding sites" - i.e. the cost is relatively minimal and you just need to be there. That may influence your decision to maintain a presence on the site.]
The most important metrics with outreach activities is the cost per win and the cost per source. You need to be able to answer the questions, "What does it cost us to land a new piece of business? And, "What are the least (and most) expensive sources of our new business wins?" One of the best ways to do this over time is to rank your sources by the number of accounts won from each.
Using a CRM system, I recommend that you track all the outbound activities between your new business person and potential clients, which are typically the following:
- Emails Sent
- Emails Received
- Quick Chat (example, "I'm sorry I've caught you at a bad time, I'll call you tomorrow.")
- Good Conversations (this is a substantive conversation that moves the prospect down the sales funnel)
- VM (left voicemail message)
- DNLVM (did not leave voicemail)
- Received VM (received a voicemail from a prospect)
- Meeting Set (set up a meeting with a potential prospect)
- Meeting Held (meeting was held with a potential prospect)
- Business Won
With these activity measurements, you can create metrics that will allow you to determine what's working and what's not. Here are those I find to be the most valuable:
Total outbound activities = emails sent + quick chat + conversations + VM + DNLVM. You should use this daily, weekly, monthly, etc. to measure and ensure that activity is taking place.
Activities per day = total outbound activities for the month / # work days in the month (or week, quarter, etc.). How much is enough? Someone in new business who's charged with outbound prospecting to a significant number of potential clients should make at least 30 outbound calls per day.
Calls : conversations = total activities / total conversations. This is a measure of how many total activities it takes to have a good conversation with a prospect. These days, having one substantive conversation out of every five or six calls is good.
Meetings per conversation: Total meetings set / total conversations. This tells you how many conversations it takes to secure an initial meeting. The lower the number the better your new business person is able to establish rapport, ask relevant questions, and establish a reason to meet. I think you should aim for a 1:2 ratio, or one meeting from every two good conversations. If you find that the ratio is higher, I recommend doing role practice to improve your new business person's skills.
Meetings held % = meetings held / meetings set. This is a measure of the quality of the meetings that are set. Over time, you should aim for nearly 100%, as this will mean that your new business person is doing an excellent job of identifying a need and establishing your agency's relevance to satisfy it. If meetings regularly don't take place, then they weren't quality meetings in the first place.
Business won% from meetings held = business won / meetings held. This will tell you how well you convert initial meetings generated from proactive outreach. Recall that in the above funnel, we used 10%. You should be able to do better. However, a note of caution: I can't tell you how many agency CEOs have told me over the years, "Put me in front of a prospect and I'll close the business." The exact same number have been terrible at moving an initial meeting along the process to actually winning. The objective of a first meeting is...a second meeting. Don't try to win on the first meeting. For more on this, read here.
With the information discussed in this post, you'll have all the information you need to allocate your resources to the sources and activities that drive the most new business for your agency.
Build your plan
by Todd Knutson | published on June 24, 2010
Creating an advertising agency new business plan is a step-by-step process. With the outline of ingredients necessary to create a new business plan provided in this post, you'll be able to make the decisions necessary to put your plan together in a matter of days or weeks.
Important note: Many "new business initiatives" are unsuccessful because management isn't fully committed to the effort. To avoid this common result, I encourage you to read the prior post (Step 1) and then "take a time out". Think about what it says. Discuss it with your management team. Together, determine if you have the collective will to change your agency's new business culture. Without this commitment, implementing the suggestions in this post will only guarantee mediocre success (at best) or failure (more likely).
Step 2: Build Your Plan
Before we begin, I'd like you to put yourself in the right mindset. Creating a new business plan is creating a marketing and sales plan for your agency. You know how to do this for your clients; now you need to do it for yourself. Perhaps rename your new business plan 'New Business, Inc.' - this might help you give it the client-oriented importance it deserves.
Who Are You; How Are You Different?
Every agency thinks they're unique, while clients think most agencies are alike. Everyone in your agency needs to know who you are, and how you're different. If you say, "We're a retail agency that delivers our big-box retail clients 15% annual year-over-year growth", you'll probably get a number of potential clients to meet with you pretty quickly. On the other hand if you say, "We're a full-service agency" and you only have 10 employees, there's going to be a disconnect.
What's your most effective approach?
Every agency needs to choose how they want to get noticed. What has worked best for you in the past, or how do you want to go about it in the future?
- Are you best when you do your own category research, and offer it as "bait" to a prospect?
- Are you most successful when you purchase research from 3rd parties and draw insights and conclusions from it?
- Or, are you best when you lead with your create work?
If you need help or are unsure about the most effective apporach, or the approach you're considering, you might ask an expert who works with agencies every day. People to consider include a friendly agency search consultant, consultants like Ignition Group, Robb High Consulting, Michael Gass, or Mirren Business Development, or one of the outsourcing companies like Linkergy or Catapult New Business.
Define Your Objectives
- How much new revenue do you want this year? Write it down.
- How much do you want to come from organic growth? From proactive new business? From passive new business (e.g. relationships with consultants, RFPs that "just show up")? Break down your revenue growth into these categories, and others if you have them.
- Now, turn your revenue growth numbers into a discreet number of wins by category. For example, how many clients do you need to land to hit your proactive new business number? Your revenue from review consultants or RFPs?
Turn Your Objectives Into Achievable Goals
Once you have your top-line numbers for each of your categories, determine how you're going to hit each of them.
- Proactive new business: using metrics from your recent past, create your sales funnel. This will show you how many prospects you need to target to have the meetings you need in order to win a new client. Extrapolate these numbers based on how many wins you want this year. These become your new business team's proactive sales goals, to which you will hold them accountable monthly, quarterly, and annually.
- Organic growth: using metrics from last year, determine the rate at which you win new business from current clients. Determine what you've done to achieve this growth. Ask yourself how you can do better this year. Assign revenue growth goals to each account team, communicate those goals to them, and incorporate them into their monthly, quarterly and annual goals, and hold them accountable to hit them.
- Passive new business: Your agency may have a "nurturing strategy" with various search consultants, or, "friends and family", among other groups that you keep in regular touch with. Set goals for each of these channels, communicate them to your new business team, and hold them accountable to hit them.
Note about accountability: we've all heard the expression, "What gets measured gets done". The great thing about this one is that it's true. If you don't know what you want to achieve, you won't achieve what you want. So, set goals ahead of time, and then make your team responsible to hit them.
Too many ad agency new business plans fail because the agency doesn't have a 100% dedicated, talented new business person who is regularly measured, and held accountable to the effort.
The challenge for many advertising agency CEOs is that dedication means the new business person can't work on client business, and won't be billable. I encourage you to look at this situation as you would one of your clients: do they have billable sales reps? Or, are those sales reps 100% dedicated to revenue generation? You know the answer to the question.
So, the decision you need to make is either:
- Will you appoint an internal person to be responsible for new business (if so, who?)?
- Will you hire someone from the outside?
- Or, will you outsource to a 3rd party expert, who will focus on proactive new business (only).
Whichever option you choose, your next step is to define the job description, how you're going to find them, and when you want them to start. Then, initiate the search. As an aside, if you're considering a recruiter, you might want to speak with Mirren Talent.
Target criteria and segmentation: Decide on the criteria you want to use to target prospective clients.
- Are there specific companies you plan to pursue?
- If not, what industries, company size (by revenue and/or media spend) are best for you?
- In what geographical area?
- What are the titles of the decision makers you're best talking to?
- Are there particular brands you want to work with?
- Or, are there particular brand demographics that are best - e.g. brands targeting seniors or Gen X?
Data: Once you know who you want to target, you need to choose a new business database that will provide what you need. Be sure that the one you choose provides everything you need. There are a range of services available at various price points, starting with "free" and going up from there.
One thing I regularly hear from clients is this: "You get what you pay for". So, think before you go for the lowest price.
Five or ten years ago, direct mail was useful as a branding vehicle. Today, it may take doing things a bit differently to get noticed. However you do it, think about what you can do yourself, as well the leverage you can get from others. For example, there are websites on which you can post your work, testimonials, clients (and much more), that will essentially market your agency to prospective clients at an affordable monthly cost (one example is Marketing Mine - full disclosure, this is a sister company to The List).
Many agencies also utilize their CEO's blog to get noticed. This is a very powerful form of social networking. For more information about creating an agency blog, call Michael Gass.
How do you want your agency to reach out to clients? For example, do you like the idea of someone making cold calls, or not? Decide, as a management team, what type of outreach you want to take place before you finalize the new business person's job description. Questions to consider include:
- Do you want them to make cold calls?
- Do they need to be an email expert?
- Will they network with search consultants?
- Will they interact with current clients to help drive organic growth?
- Do you want them to be a pitch specialist? (Are you willing to pay top dollar for this expertise?)
- Will they attend initial prospect meetings? If so, on their own or with someone else? Or, do you want them to stay focused on new business while others attend meetings?
- Or, do you plan to outsource your proactive outreach, and if so, what skills and responsibilities will be needed on the inside?
Once you define how you want your new business person or team to do outreach, you'll need to define the touch points they'll employ and goals you expect them to hit:
- If you use email, will you follow up with telephone calls? If so, what frequency do you expect? Do you want someone who sends a few targeted emails a day, or 50?
- If you're cold-calling, do you want someone to make 5 calls per day or 40? (Hint: not everyone who's comfortable making 5 a day will be able to consistently make 40.)
- What's your plan to use voicemail? Do you have a voicemail strategy?
- If networking is your preferred tactic, how do you plan to pursue it? How many connections do you expect per week, month and year?
- Or, perhaps you're best when you have a referral. How many referrals do you expect per week, month, year?
No matter your tactic(s), be sure that the person you appoint or hire is good at the approach you want them to use. If not, you'll experience a big disconnect and subsequent employee turnover.
Metrics and reporting
You also need to decide the following ahead of time:
- How are you going to measure the effectiveness of your efforts? What reports do you have to do so, or do you need to develop?
- Who's responsible to create them? Who's responsible to run them?
- Who will review them, and when? (I recommend at least monthly.)
As you think about metrics and reports, I encourage you to measure as many aspects of your new business performance as possible. Here are a few posts that may be of assistance: a simple call-tracking system; converting leads to opportunities; and, measuring your new business activity. There are quite a few others within this site. You might try using the search option on the home page. If you get stuck, don't hesitate to get in touch with me directly.
Filter Your Opportunities
What's your process going to be to review leads that you receive, as well as RFPs? Not every lead is a good one, and you probably don't want to pursue every RFP that comes in the door. Decide what you want to pursue ahead of time. Set the rules for your team so they know how you want them to respond when the moment arrives.
Here are three ways you might categorize opportunities:
- Core criteria: fits your pre-determined size, geography, category, discipline(s), etc.
- Strategic opportunity: Gives you the opportunity to move into a new category, geography, discipline, etc.
- Opportunistic: falls in your lap; represents something quick and easy to do; or, is a good source of cash.
When you've made your decisions about each of these new business plan ingredients, it's time to put your plan on paper. You now have a choice: do you want to create a document than sits on a shelf, or one that's a living, breathing guide to your agency's new business future? The former will probably become a binder and get distributed to key players throughout the agency, and end up on their bookshelf. The latter might be a one-page plan printed on colored paper that people bring with them to weekly new business meetings.
My favorite plan is the short version - overall objectives, specific numerical goals and tactics on one page. How you go about pursing outreach, marketing, job description(s), opportunity categories, etc. might become your "standard operating procedures". They should be written down, printed and distributed, but the team won't have to refer to them very often (once they understand them). Your metrics/reports will be a work in progress; as long as they're reviewed weekly or monthly, they'll become part of how you do business in no time at all.
A final thought...
The Little Things Really Matter
We sometimes forget the little things that make a big impact on a prospective client. Things like hand-written notes and welcome gifts. For best results, these should be thought-through ahead of time, included in your new business plan and made part of your agency culture. Little things like those noted in these posts, as well as the ideas you and your team come up with, are an easy way to differentiate your agency.