Why are ad agency new business executives performing so badly?

1 john morgan quote

Rainmakers who were good at new business in the past are struggling today.

According to a recent Agency-Marketer Business Report from RSW/US, the tenure of a new business director is 2 years or less. Only 26% of new business directors were viewed as successful.


I’ve worked face-to-face with more than 200 advertising, digital, media and PR agencies as they’ve struggled with the changes that have occurred in business development which was brought on by the recession, the worst global recession since the Great Depression. The recession, the rise of social media and the rapid advance of technology has also dramatically altered business development. 

There are not many people who have done this job in the past who know how to do it well now, said Avi Dan, a former new business executive at Euro RSCG, Berlin Cameron United and Saatchi who’s now president of Darling in New York.

The job has become a lot more complex. The Mad Men rain-maker days are over.

Here are ways business development has changed and what to do about it:

1. The primary battle for new business has moved online.

The indication of advertising’s radical transformation is the sustained growth of online. The survival of agencies has hinged upon the development of their digital capabilities. According to research by RSW/US, clients now expect agencies to be analytical, digitally focused and data-driven.

Prospects are absolutely consulting many more online resources than eve did, before they engage with a new business director. A recent study by the Corporate Executive Board reports that B2B buyers are 57% of the way to a buying decision before they are willing to talk to a sales rep.

Prospects are turning to online channels to self-educate about agencies and delay speaking directly with them. Agencies should re-think how they engage prospects. The interuptive type tactics such as cold-calling and email blasts aren’t efficient or effective. Agencies must align their business development strategies to the new way prospects prefer to choose their marketing partners.

From my perspective, most agencies are using 80% outbound marketing strategies and 20% inbound. Those percentages should be in the reverse order. Instead of chasing new business, it’s now more important to be found.

2. Having a working knowledge of social media isn’t even an option any longer for an agency’s new business director.

Social media is having a big impact on how agency’s promote themselves and how they are found online by their prospective client audiences.

Here are the ways social media impacts agency new business:

  • A paradigm shift for how new business is acquired. According to a recent CMO survey, 80% of decision makers say they found the vendor, not the other way around.
  • SEO is now a critical part of new business strategy. According to Marketing Sherpa, 80-90% of business to business transactions begin with a search on the web.
  • An agency blog is a necessary component for marketing your agency. As necessary as it was for an agency to have a Website, it is now as relevant for them to have a blog. It becomes the gateway to the agency and puts a face to it.
  • The growth of new media mandates agencies participate.
  • Social media is now mainstream, your agency’s credibility is suspect if it isn’t walking the walk, not just talking the talk.

So before hiring someone responsible for your agency’s new business efforts, in addition to the questions regarding their new business expertise, think about asking some additional questions like these. How they answer will tell you what they really know about social media.

  • Do you read blogs? Which ones?
  • Do you have a personal blog?  What’s it about?
  • What are the social networks you participate in?
  • Have you ever uploaded a video online?  What program did you use to do it?
  • Besides making phone calls—how else do you use your mobile phone?
  • Have you ever registered a domain name?
  • Do you use a feed reader of some sort?  Which one?  Why?
  • How do you use Twitter?
  • Do you have a Facebook page? LinkedIn? Google Plus? Pinterest?

What you are looking for is participation, experience and credibility in social media. The pool of qualified candidates is not likely to be very deep.

3. It is absolutely essential that every ad agency have a plan for their new business development initiatives.

I speak often to groups of ad agency owners. I’m amazed at how few of them have a written new business plan. That’s inconceivable to me. If you have no plan, you can’t measure what you’re doing. There’s no real strategy behind your new business activities and no focus or direction.

The new-business game has become much more difficult for even the best playing it. To win, you must have a game plan in place.

Here are some quick tips for creating a game plan for your agency’s new business:

  • It might be a helpful exercise to create a SWOT analysis of your agency: it’s strengths, weaknesses, opportunities and threats.
  • Set realistic new business goals. I can’t tell you how often I hear “our goal is to take the agency to the next level,” but they have no clue what that level is or what it looks like. In my opinion, new business goals should be obtainable.
  • Identify your top category and audience you are going to target. You must have an identifiable target.
  • Know your primary competition and create a strong point of differentiation from them.
  • Follow the KISS method. Keep everything as simple as possible including the plan. A one page plan can easily suffice.
  • Outline the new business plan through specific strategies: Public Relations, Social Media, Direct Mail, Digital, etc.
  • Establish benchmarks for the things you can measure. Have a review, update, make changes and refocus your efforts once a month.

4. Execution is the battleground that determines success or failure.

A plan is just a plan, wishful thinking, until it is executed.

According to the RSW/US survey report, 66% of agency execs stated their new business hire was unsuccessful because the person lacked a methodology.

How many annual planning meetings has your agency gone through to create a strategic new business plan only to have it fail in its implementation? Maybe next year, instead of focusing so much attention on the plan, use annual planning to create a dynamic processes for execution.

Experience has taught me that successfully executing a new business strategy requires a system, not a series of diverse projects performed by different parts of the agency.

Here are some practical tips for creating a system for new business for your agency:

  • One person responsible: You will not only need the right person in place to oversee the process. Someone who has focus, determination and consistency. These are qualities required for success.
  • Convert your strategic plan into a game plan that includes Milestone Dates, To Do List, Resources, Assignments, etc.
  • Set goals that stretch your agency, but that are reasonably attainable and measurable.
  • Determine what is needed to achieve your priorities: People, funding, equipment, space, training/development, etc.
  • Get organized: Use a program such as Basecamp, an excellent, inexpensive online project management tool to help in the implementation process.
  • Just start: A lot of time can be wasted if you don’t start somewhere. Identify and focus on the first step. Once you get going, it’s much easier to keep going. Also remember, don’t over think things, keep it simple.
  • Based on your tasks, create a must-work-week schedule. Arrange your work week priorities ahead of time. “If you don’t control your schedule, someone else will.”
  • Monitor and report progress: Unless there is an ongoing process for evaluating execution, making decisions about it, and closing the loop with the original strategy, the effort fails.

Be prepared to make changes. This is not an exercise in perfection. Plans give you a road map to your goals, but you have to be ready to make adjustments. Every plan will have obstacles. Don’t abandon your strategy at the first obstacle, create “work-arounds”, solutions, even if they are temporary. It will allow you to keep the process moving. Don’t let anything stop the implementation process.

Business development doesn’t have to be so difficult. With a little forethought and the creation of simple steps and procedures, you can create systems that will make it much easier.

photo credit: Sherwood411 via photopin

About Michael Gass

Consultant | Trainer | Author | Speaker

Since 2007, he has been pioneering the use of social media, inbound and content marketing strategies specifically for agency new business.

He is the founder of Fuel Lines Business Development, LLC, a firm which provides business development training and consulting services to advertising, digital, media and PR agencies.

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