How Many New Business Leads are Out There?

New Business Math | The Foundation of New Business

New Business Math

Math tells us HOW many clients will change agencies every year? And what, exactly, are you doing about THAT?

One of the big problems marketing firms face when thinking about new business is trying to understand the math.

Have you ever wondered just how many clients are satisfied with their current agency at present? Or just how many clients will look around at other firms during the next 12 months? Who in your market is going to invite another agency to stop by? Or perhaps go and visit another agency? Perhaps start a search? Or even worse, engage a search consultant? Is your perfect “client” writing an RFP right now that you don’t know about?
Just how many clients will actually change agencies during the next 12 months?

The Rate of Change is Accelerating

I was there when Budweiser ended a 79-year relationship with DMB&B. And how many of us remember when Harley Davidson parted ways with Carmichael Lynch after 31 years? Or when Dr Pepper broke up with Y&R after 40 years? How about when MetLife, after 83 years, cut Y&R? The list goes on and on… We all understand the client-agency relationship has changed. But how many of us have thought about that from the new business side: the math of all this change for new business hunters?
AAR now reckons that the average life of a relationship between agency and client lasts between three and four years. A study of US-based CMOs, commissioned by Adweek early in 2008, asked how many of them planned to change one or more of their agencies in the coming year. Forty-five percent of those surveyed said they intended to fire at least one of their agencies.

“Relationships are fraying and turnover is accelerating. Agency tenure has been declining steadily…”

This means that if you have 100 prospects in your target-list, around 30 of them will be hiring a new agency this year. And what if you have 200 prospects in your pool? How about 500?

The Famous No-System New Business System

Yet even with all this turnover, we are always amazed at how many agencies have no new business system in place. All of their leads are generated from infrequent activity and casual referrals. There is NO system in place to generate leads or referrals. Most firms don’t even have a centralized prospect list!
I recommend that you have between 500-600 strong prospects that you’ve targeted as a good match for your firm, and that you have an active program to reach out and touch base with them every other month or so.
That means around 180 prospects could offer you a chance to win their business in the next 12 months. That is if you have any type of system to reach out, build awareness, foster relationships, and just connect with those prospects.

New Business Is Too Important Not To Be Your Agency’s Top Priority!

  1. There are many, many lead opportunities out there.
  2. There are so many good lead opportunities out there that agencies should not pioneer by trying to win clients who have never had agencies.
  3. Agencies shouldn’t waste time trying to convince firms with in-house agencies to go outside.
  4. Waiting for leads to come in is a luxury few agencies can afford.
  5. Waiting for leads to come in also means letting the market define who you are. And that definition might be wrong, out of date, and not reflective of the “new you” or the “new you” you want to be.
If you’re serious about growing your firm, then hire an account executive for new business called the New Business Spark. The Spark is responsible for building agency awareness and creating large numbers of relationships with key prospects.
The Spark System is a European way of doing business. European agencies work to establish relationships so they will be invited in when there is a good opportunity.
Most agencies need a new business system that generates a steady stream of leads into the agency. If you don’t have a steady stream of leads, you need a Spark. New business is too complicated, too important and too competitive.

Twist Image President, Mitch Joel, brings a very stark point of view on these numbers here. And as they say, read the whole thing.

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Winning The Pitch Advice From The Experts

In the pitch are you showcasing the work or showcasing your people? And why?

Truly outstanding marketing firms understand that their presentation must be well structured, and the importance of “theatre” throughout the presentation is well understood. This is a chance to create that “magic” that so many clients have been looking for since the days of Samantha and Darrin in Bewitched, where the agency comes in with that little something special and wins the day. How can a truly great marketing firm mess up an opportunity to do something that should be natural for most advertising agencies?

Easy enough it seems. Over at Australia’s media, marketing & entertainment umbrella site mUmBRELLA Nathan Hodges listed some great pointers for those seeking to really lose a new business pitch! His list, and some of the comments, are outstanding and well worth a read!

My personal favorite on his list is number nine:

“Spend at least ten minutes messing around unsuccessfully with the presentation equipment. Preferably over a laptop in a huddle of two or three with puzzled expressions. If you’re really brave – and this is the showstopper – disappear under the table and try to re-connect stuff with your backside in the air. Unbeatable for destroying confidence. If you can’t show a simple presentation, they’re not going to trust you with a million bucks of production budget are they? (This is gold, you know. Gold.)”

You have no idea how many times I’ve seen a marketing firm fail to practice the set-up, then watch as they crash and burn in the presentation. Lucky for us, it’s the competition as our firm knows better.

A Thousand Winning Pitches

Now as many of you know we help many marketing firms behind the scenes win new business pitches. One of the reasons we’ve been so successful is we have seen every one of those mistakes, and more. In fact, we’ve written many posts on the topic of how to pitch, how to win, and what the pitch process is really about. I’ve collected a few of them below in one handy list for you to review the next time you have a pitch you really want to win.

We also have a day-long training session that outlines the “best practices” and sets up your firm for long-term success.

Pitches are “once in a lifetime” opportunities. Your presentation will make the difference between winning and losing. A truly great presentation will make great thinking and great ideas even better. And it can, sometimes, compensate for average ideas and performance.

Having someone who lives and breathes pitching, whose pitched thousands of products and services, with some of the best marketing firms in the world, in your corner seems like a winning idea. So the next time you have a pitch you really want to win give us a call.

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Win More New Business More Often

Bring in the experts! Learn how to fix new business forever and celebrate new business wins all the time.

There are always winners and losers… which one will you be?

Growing your firm these days is more important than ever. You need to learn how the new business rules have changed without wasting time. Bringing us in is a low one-time cost but the ROI is very high. You get a new business manual to keep the learning fresh for years. And just one good new business idea that you use to win an important client in the next month makes it all worthwhile.

Competition is getting harder and clients are getting tougher so you need every advantage. Your firm’s new business program is probably out of date and badly needs this tune up. Below are 6 issues we know you must master to win more new business more often.

Learn How To Grow Your Firm Faster

Issue #1: Master Your Strategic Issues

Where is the business going? What’s working across the country? Learn how to follow what the smart money is doing. Understand how to get ready for your new future. Map out key changes you’ve got to make.

Issue #2: Generate More Leads

See why your new business program must generate leads from high-value prospects. Understand how to target 80-120 good leads per year. Review the seven ways marketing communication companies organize their new business activities. Determine which new business method is best for your firm. Understand why creating relationships with good prospects are so important. Learn why having the right new business system in place means you avoid RFPs, cattle calls, and worthless capabilities presentations.

Issue #3: Close Accounts Quicker

Learn why so many firms don’t know how to build trust and therefore can’t close the business. See why without trust in place you can’t have vital discussions that lead to finding needs and fevers. Learn the right way to make first visits so you can close prospects quickly, often within 48-hours. See how to set prospects up for a 7-day close. Avoid formal searches, creative shoot outs, and Howdy-Doody call backs that don’t accomplish anything. See why with a strong fast-close program in place you never need to do another proposal. Understand “First Visit Math” that shows why you need two people on first visits.

Issue #4: Win With Strategic Consulting

Learn why having a strong consulting process is vital to your firm’s long-term success. See why you should suggest to all your new business prospects there might be a strategic problem in play, rather than some simple communication needs to resolve. Understand why you must have a “Branding Black Box” that positions your firm more strategically. See how to earn more consulting revenue, perhaps $500,000 per year, by working at a higher level. Learn how to move up your client base with your Black Box and leave small jobs and smaller prospects for freelancers. Learn how to work with better clients because you can show them how to strategically reposition themselves with a Brand Triangle. Learn what’s required to import a Black Box process into your firm to add show and impact.

Issue #5: Win More With Chemistry

Learn why chemistry is the major secret weapon in new business. See why chemistry is more important than your creative capabilities and how to get it on your side. Understand how to get hired because prospects like you better. See why prospects you thought you won, went somewhere else. Understand what you and your firm project to prospects and why that might be the wrong message.

Issue # 6: What To Do Now?

Call us, bring in the experts and see how the new business rules have changed. After we’re done, put all you learned into a cohesive plan that you can use to reshape your new business program forever. Revise immediately what you are saying to prospects. Reshape how you describe your firm and determine if you must re-brand. Fix new business forever with the changes you learned.

Sanders Consulting Group teaches more ad agencies, design firms, and Internet agencies around the world more about new business than any other firm. The largest and best managed marketing communication companies use Sanders Consulting Group as a trusted advisor to help them grow their organizations. In addition to its growth practice area, Sanders Consulting also specializes in client retention, account service training, agency operations, productivity improvement, mergers and acquisitions, and all types of management concerns including exit planning, strategic alliances, partner formation and partnership dissolutions.

 

Photo by *Alexandru1988