The past two years forced many agencies to take a hard look internally at their business development efforts. When the Pandemic began, paused agreements and decreasing scope were standard across huge swaths of most client bases, and new client acquisition needed to happen quickly. That increased need has caused many medium-to-large-sized agencies to take on a true “sales machine” mentality. No longer sitting back and saying “if you build it they will come”, these shops are competing by saying “we will bring it to you”.
With this shift in mentality, expect to see more competition than ever from other agencies this year. Outbound activity will be at an all-time high from all of your competitors.
Agency Tenure
This “bring it to you” approach of new business is especially important as you begin to realize the timing of how brands buy. In the past, the generally accepted timing of agency tenure was somewhere around three years. Every three years a brand would be out hunting for a new creative or media AOR. If we make that assumption to be true, that would mean that 33% of brands in a given year are shopping. Not too hard to find 1 out of 3, right?
Well, the assumptions made about agency tenure are deceiving. Catapult evaluated over 2,500 relationships that were tracked in Winmo and we found that the actual average tenure of a brand/agency relationship is 5.9 years! Almost double what the assumed tenure is.
Total Addressable Market and Competition
The more growth-aggressive agencies are building a sophisticated sales machine to get in front of these brands. They understand that in order to capture the 17% of brands shopping for an agency, you need to spend time educating and interacting with a higher percentage of the Total Addressable Market. You can’t ignore the other 83% that aren’t in a position to buy today, because they may be in position tomorrow. We certainly can’t force them to have a need or to go into an RFP, but we can proactively find ways to stay in front of them and lay the foundation through value-added content and conversations. It’s recognizing though that new opportunity conversations don’t always have to end with a budget and a win, sometimes the win is just in making the connection with your prospect by showing value in a unique and meaningful way.
The “sales machines” that are being built to capture business both have an eye on the 17% and the 83% discussed, but it’s not easy. In order to do that, you need both 1:1 human outreach for the 17% using both data and insights, while also spending time educating the other 83% through content, PR, SEO, and SEM methods. Neither of these paths work truly alone in a vacuum, and a more holistic approach is what is needed to ensure that you are able to compete with all the increased activity from your competitors. If you begin to slack in any one area of this approach, it will have a negative cascading effect on your entire new business process.
Finding the Right Opportunities
Below is an example of a tech stack and outreach flow that our team utilizes to go after the 17% of buyers that are looking today. This takes time, organization, and accountability to consistently use the data at hand in a very structured process in order to produce the types of meetings that we know will result in revenue. The key here though is the process. The clearer and more structured your process is in the beginning, the easier it will be to customize, adjust, and scale as you learn which prospects are falling into the 17% and which are in the 83%.
With so much disruption happening, agency opportunities are at an all-time high and it’s going to be a highly competitive year ahead. Is your sales machine running at full speed?