By Category: New Business During a Recession
Laurie Coots on growing your agency
Published on May 18, 2010
Laurie Coots is the global CMO for TBWA/Chiat Day. She's one of the smartest ad agency new business execs you'll ever meet. When she speaks, people listen. Laurie shared her thoughts on how to grow your agency at this year's New Business Conference.
I took away four simple and compelling points:
- Pick up a crumb and run with it. Pursue clients you want to work with. Incubate the small projects, as well as any other small clients you attract. Do great work. Great work will lead to more work. Crumbs Laurie pursued and grew last year created $11M in new revenue for TBWA.
- "Productize". Take what you're doing and put a price on it. Avoid charging by the hour. Consulting firm McKinsey and Co. does it this way; why not your agency?
- Learn to Sell. Quantify the opportunity. Get the decision makers in the room. [I'd add: ask smart questions, listen carefully, propose a solution, ask for the business.]
- Reinvent your behavior. Decide how you want to be, not how you think you should be.
Nurturing your crumbs is a perfect strategy to generate consistent revenue growth. In good economic times and in bad, focusing on smaller projects with growth potential gets you in the door early.
One of the great differentiators between agencies and their new business leaders is their ability to sell. If you really learn to sell, you'll stand out from the thousands that don't do it well.
I learned the power of "productizing" as a teenager. I had an odd-jobs business with two employees. When I charged by the hour, I knew how much money I'd make. However, once I created a product, I was able to charge my customers a flat fee and make much more. The technological capabilities of many agencies position them perfectly to charge a flat rate for certain services, and generate significant profits.
My last post about Alex Bogusky echoes Laurie's call for reinvention. Alex referred to it as "breaking the rules". However you choose to think about it, clients are looking for agencies that stand for something. You have the ability to choose who you want to be.
Case Study: Cinquino & Co.
Published on May 05, 2010
Was your agency able to win new business from 71% of your first meetings in 2008? How about 60% in 2009? That's what one small agency in New Jersey accomplished after being on the brink of closing its doors in 2007.
Crisis often creates opportunity, which is what happened for John Cinquino. His agency won zero accounts after 34 first meetings in 2006-07. As he and his team faced the possibility of losing their agency, they decided to things differently.
They made a pact to put the quality of first meetings before quantity. And they vowed to learn how to win.
Here's what they learned:
- Start with a hard target list that's focused on specific categories.
- Develop key case studies for each category.
- Hire a strong new business hunter.
- Your new business hunter is responsible to prospect and set up first meetings.
- Your new business hunter also preps the prospect for a "10-minute qualification call"with one of the ad agency's principals, who will be the only person at the first meeting.
- The agency principal uses the qualification call to identify the prospect's pain points and needs. When it goes well, this call may last 20-30 minutes (and the prospect will NOT be looking to get off the phone).This call:
- Establishes rapport between principal and prospect.
- Helps the principal understand, "What hurts?"
- Provides specific areas for the agency to research to prep for the first meeting.
John's recommended questions to ask the prospect:
- What did you do in the last year that didn't work?
- What issues are you having with your competition?
- What issues are you having with your brand?
The key is that you identify their pain points quickly, and then move on to the next question. You want to get just enough information to be able to connect the dots. This will enable you to do your research on the prospect's competitors, distributors, and the brand itself prior to the first meeting.
- Conduct meaningful research based on what the agency principal learned on the qualification call. Keep top-of-mind that every prospect wants to know more about:
- Their customers
- Their competitors
- The agency principal goes to the meeting prepared to take charge. Share your research and talk about the prospect's business. Try not to let them ask about you; when they do, answer briefly and then move on to something else you learned, or ask them another question.
- The agency principal leaves the meeting with very clear next steps. By now you should have a very good idea what the prospect needs. Before you leave the meeting, agree on a date for you to return to present a proposal to solve one or more of their issues three (3) weeks later.
With this approach, Cinquino & Co. closed 71% of their first meetings in 2008 and 60% in 2009. They now have three new business hunters instead of just one...out of a total staff of eighteen people.
John has proven that these nine steps work and is now in rapid-growth mode - and did so right through the recession.
Change can be just another thing that you do
Published on January 29, 2010
In our company, we constantly push ourselves to figure out how to change and improve in order to grow. Part of the pushing comes from an external source (the executive coach I mention in a recent post), but increasingly it's our own recognition that if we're going to achieve the goals we set for ourselves, it's up to us to figure out how to do it.
Setting goals is fun. Achieving them is where the proverbial rubber hits the road. The hard part of it is that it's...hard.
Hitting your goals, assuming they're challenging ones, requires that you do things differently. And, as we all know, changing even the smallest habits can be really hard. In business, changing habits means changing how we work - our processes.
Changing processes is quite challenging, particularly if the process involves multiple people and responsibilities. Each person who's involved has to change what they do and how they do it, which is where you're likely to run into difficulties.
This brings us to "Today's Word", to borrow Stephen Colbert's phrase:
mis-o-ne-ism [mis-oh-nee-iz-uhm]: Hatred or dislike of what is new or represents change
We all know that most people dislike change, and some truly hate it - and will do everything in their power to keep the status quo (just look at your typical bureaucrat for evidence of that). In our company, over the years, we've done many things to avoid change. Let me know if any of these sound familiar:
- Form a committee to investigate a particular subject; the committee report ends up on a bookshelf.
- Report on progress for a period of time, and then gradually stop doing so.
- Run into roadblocks that appear to be insurmountable, and then give up.
- See initial benefit and results from the energy of one "true believer", but then their enthusiasm is gradually worn down by the misoneists.
I'm sure you've never seen anything like this in your company!
To be successful in new business, we have to change and adapt. This means that as new business leaders, we have to be comfortable with change and need to make those upon whom we rely to get things done similarly comfortable with change. That's hard.
Here are a few of the things that we've learned about change, which may be of use to you if you're going to be a change agent in your agency:
- Set goals with the key people who will help you be successful.
- Break each goal down into all the steps that you can think of. For example, we recently had a brainstorming session to identify information we needed to know and have at our fingertips in order to create a series of projects that would, together, allow us to achieve one part of one goal.
- Set milestones for each of the steps along the way to achieving each goal.
- Assign responsibilities to each step or process or project.
- Assign due dates for each.
- Set a series of weekly meetings, when each team member is responsible to give a status report to the group. Meet immediately afterwards to resolve or bring resources to bear on significant issues.
By embracing this type of process, which breaks change down into small pieces and makes it a normal part of every day, change is becoming just another thing that we do.
Hopefully you'll find this to be a useful technique to use with your new business team.
How Justin is turning around an almost-lost client
Published on October 08, 2009
Customer retention, let alone organic growth, usually comes down to people delivering on promises. Missed deadlines, less than acceptable quality, and poor communication all naturally lead to lost accounts.
So it was invigorating to hear how Justin, a high-potential junior account manager I meet with a few times a year, yesterday described how he's being called upon to revive an account on the verge of being lost.
Over coffee, I first asked Justin what he discovered upon receiving his new assignment last spring. He described:
- Missed deadlines. Initial deliverables that were days late. They weren't weeks late, but it was a bad precedent.
- Poor communication. The higher ups at both agency and client had no idea what was going on in the trenches.
But, as he started digging into the depths of the relationship, he found that the situation was much worse that it appeared:
- Deadlines meant nothing. Future deliverables would be weeks late and there was no sense of urgency to meet promised delivery dates.
- Communication was broken. It had completely broken down between client and agency and within the agency itself.
- Personality mismatches. Certain members of the agency's team were oil and water with their client counterparts.
As it was now October, I asked what progress he'd made in the last six months. He said that he was not yet out of the woods, but had made significant progress by focusing on four things:
- Management involvement. He made sure that a key manager was present from both sides at key meetings.
- Communicating reality. He made sure everyone knew the problems, and more importantly what was being done to address them. He did not put the problems on the key managers' shoulders; he let them how they were being handled and if he needed help overcoming an obstacle he asked for specific help.
- A new team. He removed two toxic members of his team and replaced them with people who better meshed with the client.
- Hitting deadlines. The new team was setting realistic deadlines and had hit all milestones since July.
I'd like to focus for a moment on one of the things that Justin did that is really important when communicating with your boss. It's best summarized by two words: No Surprises.
Particularly when things aren't going well, it's critically important that you don't surprise your boss with bad news. As you learn things or have a "gut feeling" that things are changing for the worse, tell your boss. You don't want to make the problem theirs, so go to their office prepared with an action plan to correct the problem.
Never let your boss discover the problem by asking you questions. If you do, he or she will likely conclude that either:
- You aren't on top of what's going on; or,
- You're trying to keep bad news from them; or,
- You're trying to fix the problem so they never know there was one.
Once your boss does find out what's going on, which they will, they'll be surprised. Surprises are almost never good. (Even good news, if it's kept hidden for very long.)
The best news that came out of my meeting with Justin was hearing him say that his client had started talking about future projects. Six months ago it was how his firm was likely to be replaced; now he has a chance to create organic growth and earn a bonus.
That's the mark of a good account manager. And as we all know, account managers like him are an essential ingredient for organic new business growth.
Signs of a turnaround
Published on October 01, 2009
Dave Currie, President of Catapult New Business sits in a fairly unique seat. Catapult gets meetings with corporate marketers for its agency clients. While Dave speaks with dozens of agencies a week, his new business team talks with hundreds of corporate marketers. He quickly feels changes in the new business climate, so its in that capacity that I asked him to give us an update on the recession.
So what are you seeing out there in terms of a recovery, asked an eager new business director at a Chicago-based agency earlier this morning? Are some categories showing more promise than others?
These questions have become the norm in recent months while talking with a wide variety of business development people across the country.
I'm happy to report that, yes, we're seeing significant signs of an initial recovery in all our key indicators. There are also several categories that are showing more promise than others.
Three Quantitative and Qualitative Key Indicators We're Watching
1. Internal New Business Metrics
- In the past 12 weeks Catapult has noted a 20+% increase in conversion ratios within our clients' new business funnels.
- In the last 6 months, initial interactions with prospective clients, quality conversations, and qualified meetings have all steadily increased.
2. Reported New Business Wins
Quantitatively reviewing our clients results as well as information provided by MediaPost's "Accounts on the Move" (subscribe here), reveals that in the last three months there's been a 12% lift in awarded new business.
From a qualitative perspective, on each call and email exchange I have with agencies, I ask how they're doing. Increasingly, the response is positive. This morning, for example, I received an email from a large, full-service agency in New England whose principal said, "We're seeing things pick up a bit, let's hope the trend continues!"
We also speak with hundreds of corporate marketers each day. From these conversations we've identified that marketers are:
- Increasing their spend over the same period in 2008.
- Looking to invest their remaining 2009 budget so they don't lose it in 2010.
- Open to conversations around proven results and ROI.
- Seeking better value through alternative compensation models.
- Open to innovation.
3. Traditional Market Analysis
Here are three indicators, among others, that continue to provide good insights into market (and mood) shifts:
- Wall Street Journal's daily economic data
- The U.S. Leading Indicator at Econtrends
- The S&P 500 snapshot at CNN
The general consensus seems to be that, although a broad-based recovery may be 12 months ahead, it looks like we have a relatively stable foundation for growth.
On the new business front, some markets are showing signs of recovery faster than others. If you can take advantage of opportunities earlier than your competitors you may be able to capitalize on a changing market.
Some of the positive changes that we're seeing now and expect to continue into 2010 include:
- Big-box retailers. The upcoming holiday season / seasonal influence is helping.
- Regional finance and banking. This sector is experiencing positive changes, though some banks are still in trouble.
- Consumer OTC and health care. Seasonality is impacting the sector (cough / cold / flu and consistent spending through the downturn).
- Consumer package goods. In particular, the healthy snacks category.
- Quick-serve restaurants and casual dining. We've seen a 45% increase in opportunities in the last six weeks.
What can you do to take advantage of this opportunity?
Agencies that have undertaken the following are seeing improved new business results:
- Having a clear, unified vision and brand.
- Differentiating themselves in a saturated market.
- Positioning themselves as experts to their prospects.
- Investing in self-marketing.
- Communicating with prospects throughout the economic downturn.
- Addressing a known or assumed business challenge.
- Carefully targeting the right prospects.
- Sending specific messages to specific job titles.
- Utilizing a mixed-media approach in their outreach, including social media, and employing multiple prospect touch-points (up to 15 in many cases).
It's a bit like cutting off your nose to spite your face
published on September 30, 2009
It's my birthday (it's not divisible by five, just another on the short march towards the big five-oh), and I've given myself permission to rant after hearing this comment one too many times from
Study reveals execs prefer face-to-face
published on September 23, 2009
According to a recent Forbes Insights study, business executives prefer face-to-face meetings and conferences over virtual meetings, and overwhelmingly agree that they're necessary to build
The lifeblood of most agencies
published on September 21, 2009
When you analyze the cost of acquiring a new client, generating new business from referrals is usually the least expensive. Realizing this, the natural question to ask is, "How do I get more?"
Resist pressure to reduce your fees
published on August 24, 2009
A recession is a scary time for the person trying to maintain the financial health of the agency.
I got into a conversation with a fellow CEO the other day about the pressure agencies are under to
The skills of your hunters and farmers are critcial to landing and retaining clients
published on August 14, 2009
Tight client budgets, hungry competitors, and aggressive new business hunters make for a tricky new business environment. That's what we're all experiencing now, and probably will for some time -
Why shouldn't ad agencies or design firms launch their own brands?
published on July 17, 2009
In a recent post I mention the opportunity to partner with upstart technology companies as a new business play. This month's Fast Company article titled "Selling Soap. Literally" shows how some
Reports point to continued decline, with opportunity on the horizon
published on July 14, 2009
It feels so good to wake up to a headline like this: ...during a presentation this morning Brian Wiesner of Interpublic Group of Cos' Magna, said that the U.S. advertising economy will drop 14.5%
Think twice, then act decisively in pursuit of new business
published on June 19, 2009
Chi Wan thought three times before taking action. When the Master was informed of it, he said, "Twice will do."
Shaun Rein writes about "Confucius' Three Keys to Successful Leadership" in a
Recession success proves the power of a well executed strategy
published on June 09, 2009
Amid stories about client losses, staff cuts and reduced spending are powerful reminders that a well-executed organic growth strategy can be a powerful revenue-generator in good times as well as
Take a page from Jack Welch's playbook
published on May 29, 2009
Ad agencies must drive new business to grow. But then there's growth through acquisition. Or, perhaps "stealing" your way to growth. If you missed this from today's Vanity Fair/Bloomberg Panel,
Facing lack of new business growth? Loss of clients? This is what a recession feels like, so now's the time to rally your troops
published on May 26, 2009
Ad agencies and other marketing services firms are perfectly positioned to get creative and inspire their marketing talent on behalf of the firm. reminds us that,
But in any economy, clever entrepreneurs find opportunity where others see only problems
published on May 25, 2009
Imagine running your agency while fearing imminent kidnapping of a family member.
I spent the Memorial Day weekend with family. We are quite a crew of different nationalities and cultures. One of
Push responsibility for new business throughout your entire agency
published on May 04, 2009
I'm talking to more agencies and marketing services companies that are trying to enlist everyone in their companies to drive new business. Miriam Marcus wrote an article in Forbes magazine the
Create an agency culture that believes in and thrives on opportunity
published on April 30, 2009
Karen Albritton's comments in AdAge's Small Agency Diary were right on the mark and are key to agency growth in any market, and particularly today.
Karen identifies 4 ways to maintain opportunity
It's okay to hunker down during a violent storm, but not as the economy contracts
published on April 21, 2009
Last fall, as we all started feeling the effects of the economic slow-down, agency CFOs started tightening controls over new business spending.
- Individual employee spending limits were reduced or
For most ad agencies, successful proactive new business begins with identifying a group of likely clients
published on April 10, 2009
To get started, first identity the size of your funnel. The next step is to build your prospect list - the types of companies and corporate marketers who are most likely to hire your ad agency.
Starting an agency any time is difficult; succeeding today is even more challenging. Tips for success from a venture capitalist
published on March 27, 2009
I stumbled upon a post by Paul Graham, venture capitalist, titled "How Not to Die". It's the notes from a talk he gave at a dinner for the leaders of companies his firm had invested in. As someone
Right-size your agency instead of eliminating your sales and marketing effort
published on March 17, 2009
The day before yesterday a Midwest agency CEO called and told us that they cut all new business spending at their 40-person full-service agency. I cringed when I heard the story.
What would you