New business is the future of your agency – if you don’t invest in it and treat it like your best client, you’ll come to struggle with and dread new business more than anything else. Here, agency growth consultant John Heenan looks at 9 things you need to focus on to be a new business success
Advertising agency roles are often well defined, and the skills and experience for each are pretty specific. Typically, the larger the firm, the more specific each role is. The smaller the firm, the more likely each member will cover a variety of roles as needed. The one role that is the most amorphous is business development.
I asked a variety of agency owners and leaders who does business development for their agency. Over 44% replied that they did, 39% had a dedicated BD person, and 17% placed the responsibility in account management’s hands. I asked a variety of BD people where they came from, and 55% replied from an account management background, 20% from a strategy or planning background and less than 15% from a non-agency sales environment.
The reality is, less than 20% of the people who are responsible for growing the agency have had any professional training or credentials in business development. Granted, agency owners and former account people have lots of experience through on the job training, and many of them are very successful. But from an objective perspective, the vast majority of people responsible for the future of the agency are “accidental BD experts.”
It seems our industry has a rather laissez–faire attitude – anyone can do it. Moreover, we often pay attention to the role in fits and starts whenever an opportunity presents its self. To ease the guilt, we send our BD person du jour to the annual business development conference to help them improve. Don’t get me wrong. There are great conferences and training available, and I urge everyone to take advantage of them frequently.
My point is simply this. No wonder success rates are so low, and we have such a hard time growing. That is good news for the many business development resources that serve this industry. That is bad news for business development people who on average last less than two years. If you look at other B2B businesses, you will find a much higher value placed on sales and business development expertise. In most industries training and professional development are inextricably linked to business success. Why not for us?
Despite the murky career path, there are many agencies that do an exceptional job of wining, and growing clients. And, there are agency owners who place great value in their business development efforts, invest in talent and training, follow rigorous processes and practices such that their results stand out from the rest. I’ve heard win rates north of 75%. But for many others, it just isn’t so. And for most, the win rate is 10 – 20%.
The decision-making is often self-fulfilling. One agency owner told me, “I can only get 10 – 20% of the business I chase so why should I invest or divert any more resources. It just doesn’t pay off.” Contrast that with another agency principal who said, “I treat my business development team as the most important asset in my agency. Some years I only grow a few percent but other years I grow up to 30% and always search for ways to make that 30% happen more often.”
In this business, your clients are your most valuable assets. Without them, there is no tomorrow. But your next client will become your most valuable asset the day after tomorrow. In fact, new business IS the future of your agency. If you don’t invest in it as if it is your most important client and treat it with the attention, energy and passion as if it is your favorite client you will struggle and dread new business more than any other aspect of your agency.
If you want to turn your agency new business effort into the best part of your agency, do these 9 things:
Most important of all, the average win rate for new business is 25% or less. That means your BD person loses 75% of the time. That is tough on anyone’s ego and so you need to give your reassurance and commitment often so they can get back in the ring and fight the good fight over and over again. Lets Grow!
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