Guest Post: Repairing the Ad Agency New Business Highway
Signs of a turnaround
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).