Business Development

I Don’t Do Business Development …

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

Proudly contributed by John Heenan | agency growth consultant

Last week I talked to a young, aggressive agency owner who wanted to grow fast and thought the best way was to create a conceptual campaign to take around to marketers in hopes of selling it to someone. The owner didn’t want to spend time away from current clients to work on cultivating new relationships and new business. She believed that a hired gun could go selling for her. The owner was only interested in clients who could sign in 30 – 90 days and did not want to bother with long-term relationship building. Who wouldn’t?

In the same week, I spoke with a seasoned agency owner with years of experience working at and owning agencies. He talked about how bad things had gotten for his agency with no pipeline, no leads, and more clients fading away. He devised a ready-made offering to generate sales in the shortest amount of time guaranteed. He was looking for someone who could hit the road and sell his package to brands desperate to end the year with a bump. Who wouldn’t want that? NoThanks

Both of these examples have the same thing in common. Neither wants to do business development, the hard work necessary to compete and win and grow and stay in the ad business. Each believes they can do something different, create something out of thin air, come up with an idea no one else has had before that will be appealing and successful for everyone. And, their idea is so good it only needs a salesperson to take it to hungry marketers. The young owner felt she could sign 3 – 4 new clients per month while the experienced owner would be happy to find just one. I politely declined both.

It’s not that I don’t like helping agencies be successful. There is no greater feeling than to win new business and new clients for agency owners. Regardless of one’s level of enthusiasm or commitment, there are some fundamental truths to selling any product, service, or relationship, and their ideas were not. It’s not that I don’t believe in innovation. Innovation is the lifeblood of every industry. These weren’t innovative ideas but rather as old as snake oil. While there may be marketers who still fall for it, not me.

These two examples are not unique by any means. They are emblematic of an all too common dilemma among agencies. It’s the ‘I don’t need to do business development’ syndrome. Whether they think their work will bring new clients, or their notoriety will keep the phone ringing, or their network will keep them busy, when the leads dry up, and clients go elsewhere, the reality comes and panic sets in. It may be one or many years before the crisis, but every business that doesn’t have sales and marketing as an integral part of their operation is doomed to failure. The puzzling thing is why so many agencies think they are different.

There are a few agencies who have had pretty good runs without any formal business development. A very few. Unfortunately, other agencies see that as proof for them. They have no idea what the underlying factors are for the success, or they believe they also embody those same factors. Whatever the case, the chances of succeeding are almost zero whereas the possibility for success through business development is, on average 25%. While it is true that the cost and time necessary for a healthy new business effort is much more than doing nothing, doing nothing will eventually result in nothing.

Neither of these two examples had any business development efforts ongoing. The former had leveraged industry relationships to grow her new agency, and those had all dried up. The later had stopped all business development when the agency got overwhelmed with low paying client needs. Both had come to the desperate reality that they had to do something, or they couldn’t make payroll, couldn’t pay rent, and wouldn’t dip into savings anymore.

These are cautionary tales for every agency. Don’t neglect your business development responsibilities. Doing so is no different than ignoring your best client. Initially you can avoid any repercussion, but eventually, that client will go elsewhere, probably to an agency that has a business development program running. Also, then there is the absolute heartbreaker when a recently discovered prospect replies if only they knew about you six months ago when they picked a new agency.

The only solution is to have a business development program – that is well-defined, integrated into the operations of the agency, is regularly monitored, delegated across functions, and reviewed every six months. Keep in mind that the waves in the marketplace will buffet your efforts both positively and negatively. Don’t expect consistent results. Be patient. As long as you have a steady drumbeat of common-sense tactics and an ever-refreshed prospect list, you will have both short and long-term opportunities to keep your agency growing. It won’t happen overnight, but it will happen over time so get started now.

I want to help you get your business development program started or restarted. Click on Schedule a Call and let’s talk about what has been working well and what has not and how to fix it. If you like this post, click the thumbs up, so I’ll know and then sign up for my new business newsletter. Follow me on Twitter and LinkedIn for daily tips, tricks, and insights. #LetsGrow!

Meet My Friend Mr. Bill Crandall

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

Bill Crandall, Founding Partner & Chief Marketing Officer, Steadman Crandall Business Development LLC

With over 35 years of brand marketing, agency, and new business development experience, Bill founded SCBD in 2014 as a new alternative resource for relatively smaller agencies and companies looking to grow and level the playing field against their larger, better financed competitors.

One thing, among many, that separates SCBD and Bill from most of other new business development consulting competitors is a rare combination of both client and agency experience.

In the course of Bill’s highly diversified marketing and agency account management career, he has worked for agencies such as Ted Bates Worldwide, IPG’s SSC&B:Lintas and Campbell-Ewald Worldwide, Scali McCabe Sloves, Earle Palmer Brown, and Della Femina.  Client brands have included Bubblicious and Trident gums, Bayer Aspirin, Friskies and Purina pet foods, Mennen personal care, Nabisco, Perdue Farms, Castrol motor oil, JVC consumer electronics, Sheraton and Marriott hotels, Jordache and Bill Blass fashion, apparel & accessories, U.S. Navy Recruiting, and the New York Metropolitan Transportation Authority (MTA), et al.

Since moving 100% into the new business development space about 15 years ago, Bill has brought his agency employers and new business consulting clients into some very big client rooms:  MasterCard, Estee Lauder, AOL, Time-Warner, SONY Music, BMG Entertainment, Procter & Gamble, Kraft Foods, Dole Foods, Kellogg, General Mills, Colgate-Palmolive, Pillsbury, Sara Lee, ConAgra, Clorox, Frito-Lay, Heinz, Quaker Oats, Café Metro and Fresh&Co fast-casual restaurants, and most recently, Steve Madden footwear & accessories.  The list goes on.

Bill received his BBA in Marketing, on academic scholarship and with honors, from Hofstra University and completed his MBA degree program at Hofstra’s Zarb School of Business.  Post-graduate Executive Program studies in global branding and finance were completed at the University of North Carolina’s Kenan-Flagler Business School.  Bill was elected to the Hofstra University Zarb School of Business Advisory Board, Marketing & International Business, in 2014.

Inquire and contact at: www.steadmancrandallnyc.com

Responding to Requests for Proposals – Heavy-Duty Advice

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

Building an agency one request for proposal (RFP) at a time is a painful and potentially humiliating way to grow a business. And while winning without pitching means not playing the RFP game, there’s more subtlety to the approach than simply saying no and feeling good about yourself all the way to bankruptcy. In this long-overdue issue of the Win Without Pitching Newsletter I address the specific steps to take in dealing with requests for proposals.

The Four Priorities of Securing New Business

Before I address the specifics of RFP responses, let’s recap the four priorities of how you want to go about getting new business.

1. Win Without Pitching

Through a proactive selling strategy, you ultimately strive to secure new engagements before they get to competitive situations, before you are asked to part with your thinking without appropriate compensation.

2. Derail the Pitch

When you cannot win without pitching and the prospect lets you know that he is talking to other firms and has a defined selection process in place, your objective is to derail the pitch: to get the prospect to put aside his process and take a series of small steps with you.

3. Get the Inside Track

When you cannot derail the pitch, your objective is to gain the inside track – to gain concessions in the selection process that would see your firm being treated differently than the others. Someone almost always has the inside track. If it’s not your firm, it’s another and the odds are against you.

4. Pitch or Walk

You will secure new business through one of the means above only if the prospect recognizes and values your expertise. If he does not, then it’s decision time. Do you preserve your integrity and future business opportunities by walking away, or do you get out the dogs, ponies and dancing girls and play the pitch game, against the long odds? If you do decide to walk (as I recommend) it’s important that you do so properly in order to preserve future opportunities.

Step One: Why Us?

When an RFP comes in for work that is well suited to your expertise, your first response is to pick up the phone and ask, why us? In doing so you are endeavoring to determine if the prospect recognizes and values your expertise. What you want to hear is, “You come highly recommended by ____”, or “We love the work you did for ______.” What you do not want to hear is, “We Googled ‘ad agency’” or “We sent this RFP to every firm we know.” Be selective and strive to be seen to be selective.

Step Two: Say No

After digging deep to determine whether or not the prospect recognizes and values your expertise you then deliver the first objection: “I need to let you know that we don’t typically respond to RFPs.” Any objection you raise can always be removed by you at a later date. Here you are trying to gauge the flexibility in process the prospect might afford you; their willingness to let you derail the pitch or offer you the inside track. Continue with, “But, before I say no, let me you ask you a few questions.” These would be your questions around explicit need, and the fit between the prospect’s need and your expertise. What are they looking for in an agency? Do they see that expertise in your firm? Poor fits might be put off by this reversal of the qualification process (you trying to determine if they qualify), but good fits and good clients will appreciate your selectivity.

Step Three: Substitute Appropriate Next Steps

Here’s where you ignore what has been asked of you in writing and suggest a next step that is in line with what is almost always your stated objective: to determine if there is a fit between the prospect’s need and your expertise suitable enough to take a next step together.

“Why don’t we come and see you and your team” (if they’re local – use the web if they are not) “and in 45 minutes or so we can determine if there’s a suitable enough fit to pursue this.” If they’re sticking to their process and denying you your suggested next step, then you will not be able to derail and it’s unlikely you will gain the inside track. Then it’s time to walk – step seven below. Note that the appropriate next step is not always a meeting. It might be a needs assessment, or more information in other forms.

Step Four: Use Case Studies

If you do get the meeting you begin with stating your objective: to determine if there is a fit between the prospect’s need and your expertise suitable enough to take a next step together. Now walk through your case studies of how you’ve helped companies like theirs solve challenges like their own. I have written extensively on the crafting of these process-framed case studies that demonstrate a defined way of working and allow you to stay on the right side of the line that separates talking about how you would solve the prospect’s problem from actually solving their problem. Use them here.

Step Five: Suggest Another Way

After reviewing your cases studies that should prove that you actually use the process you talk about on your website and in your brochure, you then check to see if the prospect still sees a fit. Can they see themselves benefiting from the consistent outcomes your demonstrated methodology implies? If so, suggest a phased engagement as an alternative next step.

Instead of committing the entire budget to your firm at this time, a phased engagement (usually a diagnostic in some form that let’s you get to the heart of the opportunity and prescribe a strategy, plan and budget). The phased engagement allows the prospect to take a small first step with you to try on the fit. Add in an opt-out clause (“At the end of the first phase, if you think you’ve made a mistake in engaging us we can part company and you can go back to your RFP”) and a money-back guarantee, and your proposition is a compelling one. When yours is the right firm for the job, this approach is a viable alternative to the client’s selection process in which a number of firms are asked to take on risk instead of just one.

If the prospect does not see the value in your offer then it’s time to walk. You’re not likely to win the business anyway. If they like what they see but are sticking to the process and want your written proposal, now’s the time to reassert that you are not in the proposal writing business. The relevant, detailed case study that you’ve just shown them, is your proposal. “We propose to do this (case study) for you.” Remember, the proposal is the words that come out of your mouth. The document is the contract that is produced only once the proposal is agreed upon in principle.

Step Six: Seek Concessions

If the prospect is demonstrating that they recognize and value your expertise, that they really think yours is the right firm for the job, but for reasons of policy or politics they need to go through the RFP process, then it’s time to see if they will walk their talk and show you the inside track by allowing you concessions to the RFP process. It’s negotiating time. Concessions can be made on costs (will they pay your travel costs or pay you fairly for work they’re asking of you?), on what you will submit as an RFP response (case studies versus free thinking) or a host of other areas. If the prospect is willing to treat you differently then it may make sense to proceed on the newly negotiated terms.

Step Seven: Walk… For Now

No concessions, no inside track, means it’s time to walk, but with a polite professionalism that will preserve any future opportunities. “It doesn’t seem like there’s a fit here. Why don’t you go ahead with your RFP process and if you don’t find what you’re looking for, feel free to give us a call. We’d be happy to have another conversation with you at that point.”

People want what they cannot have. Walk away in this manner and see if the phone rings after the usually flawed RFP process runs its course. Occasionally the prospect will call back, and when they do you will be in the driver’s seat. If they do not, then call them in a month or two and ask how they made out. If the prospect hired an agency and is perfectly happy with that firm then congratulate them, wish them luck, and tell them you’ll check in with them down the road to see if you can be of assistance in another manner, on another day. There is always another day and if you’ve handled the departure properly you will be better positioned for that day.

Guest Author and Expert – Blair Enns of Win Without Pitching

How Stressed Are You? Drew McLellan of AMI Will Help You Analyze

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

We manage our people, we manage client expectations and we manage our finances. And then there’s email management, biz dev management and a host of other things that are under our watch. But all of that focus on making sure that everything is running like clockwork can also jack up our stress. That stress shows up in a lot of little ways:

  • We are short tempered with our team, family and friends
  • We feel like we can never let up or wind down
  • We miss deadlines (internal or external)
  • We fall behind, putting incredible pressure on our teams to cover our rear ends
  • We are distracted when we’re with our family and friends
  • We feel our jaw clenching, our head pounding or our back knotting up

Our “normal” work day is to run around and put out fires all day. I don’t know about you, but I don’t think I have ever had a work day that played out exactly how I thought it was going to when I woke up that morning. We have chosen to live in chaos. And sometimes, we even like it. But like it or not — it’s our reality.

And that’s before you add in our personal life and the challenges that sometimes come from that side of the equation.

The truth is — we can’t escape stress. They say, in moderate doses, it’s actually good for us. But left unchecked, it can diminish our effectiveness and we bring a less than ideal version of ourselves to work and home. And we all know — there are some serious physical/health consequences to boot.

To survive that reality, we need coping mechanisms. Yes, I know for many of you, it’s that first glass of wine in the evening! But I’m going to suggest that for most of us it needs to be something bigger. Something scheduled. Something that releases the tension and rejuvenates you to boot.

Here’s the kicker — you have to put it on your calendar. Whether you do it (whatever your “it” is) before or after hours, on the weekend or during the work week — if it isn’t on your calendar, it is not going to happen.

I think most of us suck at this. We know what we should do or stop doing. But we don’t. We think things will slow down, get better, more organized or whatever. But the truth is — that’s not how it works.

Please pull your calendar out right now and schedule your stress relief. For this week. The rest of the year. And into 2019. I want you to be around, to be productive, happy and to be capable of bringing the best version of you to your team, clients, partners, family and friends.

Thanks Drew!

 

Seven Reasons Why/How Ad Agencies Lose Business

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

The late, great David McCall used to say that the day an agency gets an account they are a day closer to losing it.  A bit cynical, but very true.  As a recruiter, I have asked many advertising agency executives why they lost an account and many client executives why they pulled their business from their agencies.  Here are my observations from the many answers I have received.

1)    Change in client key personnel

No surprise here.  As they say, “The new broom sweeps clean”.  Many a CMO, CEO has fired their agency and hired a new one in order to work with someone they previously knew or a friend who they trust.  Many simply hire a new agency to insure loyalty to them.  It happens frequently and often without warning, but this happening should be at least anticipated by any ad agency if a new senior person joins their client.

2)    Clients who become tired of their advertising

Clients often become tired of their own advertising long before the consumer does; after all, how often can a company show the same commercial to their sales force? All agencies should anticipate this problem and should be constantly working on ways to refresh a current campaign in order to keep the client enthusiastic.

3)    Agencies do not listen to their clients

I have had dozens of client advertising and marketing executives tell me that their agencies just don’t listen.  Sometimes what the clients want is significant and, ironically, sometimes it is merely the feeling that the agency is not paying attention to their needs.  I had a client tell me that he had been asking his agency to prepare an FSI (Free Standing Insert) coupon ad for both print and digital and his agency simply ignored him.  He hired a new agency to do that and it opened the door for the existing agency to lose the account.

4)    Agencies become arrogant about their own work

Apropos of two and three above, sometimes the work does wear out.  Many agencies have insisted on not changing the campaign when a new solution is long overdue.  This is very common, especially with long-running campaigns.

5)    Agencies don’t insert themselves into their client organizations

A common complaint is that clients don’t see their agencies except for major presentations.  One client told me that he had actually not seen his agency management in two years (although he had seen his account team). Agency management needs to see its clients, no matter how small, on a frequent basis.  Another client told me that his account team never came to see him on a one-on-one basis.  They only came to see him en masse or for major presentations.  Many have told me that they do not hear from their account teams with regularity.  Account people need to talk to their client counterparts every day, even it is just to say hello and ask if there is anything they can or should be doing.

6)    Agencies that have not learned their client’s business

I have heard about agencies presenting work that is rejected because it is not consistent with the client’s objectives or which is inconsistent with the client’s business situation or issues.  In many cases, the client has not communicated its problems or objectives to the agency, but it is up to the agency as a service supplier to learn its clients’ business, even at the risk of being pushy.

Agencies need to have a constant presence at their clients in order to know and understand their account(s).  They must take the time to learn their clients’ business.  And agencies cannot use the excuse that the procurement people won’t allow frequent visits.

7)    Agency Merger and Acquisitions

Never been sure what actually happens, but from observation, accounts seem to leave agencies once they have been purchased or merged.  Change in management and procedures certainly has a lot to do with it.  All too often, senior account and creative people get moved, rotated or terminated which angers clients because it upsets the status quo.  I have never figured out why one agency buys or merges with another and then completely decimates the culture – causing the very clients they purchased to leave.

Guest Author Paul Gumbinner, President of The Gumbinner Company, executive recruiters for advertising.

Rebuilding Your Business Model

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development, Marketing Consultancy

As the old axiom goes, all you need to start an agency is a desk and a phone. In the 21st century version, the desk might be replaced by a laptop computer, but the perceived simplicity of professional service firms is based on the fact that we are essentially knowledge businesses. We don’t have manufacturing facilities, product inventory, warehouses, or distribution centers. Just the same, professional firms are built on top of a set of capabilities and practices that constitute a business model.

The problem is that most leaders have never stopped to consciously identify, examine and modernize the interlocking pieces of their business model framework. In truth, precious few leaders of professional firms could even map the elements of their business model on a piece of paper. So when we see headlines about “The death of the agency business model,” the issue is more a matter of benign neglect than mismanagement.

A triangle of value

Even among business school types, “business model” is an amorphous term habitually referenced in books and articles, but scarcely defined in a way that allows for productive discussions about how to optimize the business strategy of the firm. Over the years, my colleagues and I have worked to develop a useful framework to describe the key elements of a professional firm’s business model, which has resulted in what is essentially a triangle of value. Each side of the triangle represents one of the three key reasons a professional firm exists:

  1. To create value
  2. To deliver value
  3. To capture value

Creating value is the foundation of your firm’s success, and it rests on a clear definition and understanding of the specific client challenges your firm is best prepared to address. Most firms approach this question precisely backwards, showcasing the obligatory bullet point list of services as the standard bearer of their business strategy. But the capabilities you offer must emanate from the types of business problems you solve for your clients. Clayton Christensen frames this in context of Jobs to Be Done Theory; the idea that clients hire a specific service to solve a specific problem.

The essence of this leg of the model is to clearly define and articulate “What are the problems we solve for our clients?” The most powerful way to do this is to state these problems from the client’s point of view, in first-person language.

Equally important is a clear articulation of the markets you serve. The answer can’t be “everyone with money,” as some firms regrettably define their target market. Peter Drucker famously observed that marketing starts with the question “Who is your customer?” and this question applies just as much to professional firms as to the clients they serve. Your target market doesn’t have to be a type of industry category; it can be a type of audience or even a type of brand.

Delivering value is the second piece of your business model. This means developing and supporting an effective engagement model, which is comprised of your operating model and your production system. Most agencies get high marks from client organizations when it comes to responsiveness; meeting deadlines, reply client requests, and fulfilling scopes of work. In other words, we’re seen as very responsive. (Unfortunately, client ratings for agencies being proactive are dismally low.)

When it comes to the operating model, the central issue agencies must address is differentiating between short-, mid-, and long-tail offerings. These solution sets vary widely in perceived value to clients, and must be delivered in very different ways by agencies. Short-tail offerings are the agency’s unique blockbuster competencies; uncommon services and programs that provide high-value solutions to client problems. Mid-tail offerings are capabilities that are routinely applied in most engagements. And long-tail offerings are the widely available executional services and activities that are seen as standardized (and therefore commoditized) by most clients. These three classes of offerings must be developed, delivered and priced in very divergent ways. The mistake most firms make is bundling all three service classes under the banner of the dreaded “blended rate,” the absolute worst way to address the continually-evolving disintermediation of agency services.

Capturing value is the part of the business model where professional firms struggle the most. The root of the problem is trying to package up the value of knowledge work in a unit of time; a hugely suboptimal way to get paid for the expertise and intellectual capital that resides in your firm.

Effectively capturing value is dependent on having an actual revenue model (billing for your costs is not a revenue model, it’s just a reflection of your cost structure). Professional firms with actual revenue models have replaced their rate card with a “pricing stack, a variety of ways to capture value in ways that align with the principles and practices of modern pricing. These include such approaches as dynamic pricing, two-part pricing, royalties, licensing IP and more. At the very least, it means pricing based on the perceived value of the outputs or outcomes, not the cost of the inputs.

To fully capture the value you create also requires commercial alignment; uniting the entire organization behind a shared vision of what you really sell and how you should get paid for it.

Not planning, but choosing

Especially if your firm has been in business a decade or more, it’s very likely that you’ve arrived at your current business model more by default than by design. You are living with an emergent strategy rather than a deliberate strategy. If this describes the current state of affairs at your firm, you have the opportunity (if not the obligation) to deliberately design your business model.

Your remix is not necessarily to make plans, but to make choices. Business planning is about taking steps and deciding what to include. Business strategy is about making choices and deciding what to leave out. As you examine each element of your business model, the job is to not to figure out how you can be better, but how you can be different. As design thinker John Koklo recently observed, “Leading companies say No much more than they say Yes. Rather than chase the market with follow-on features, they lead the market with constrained focus.

Propulsion is written by Tim Williams of Ignition Consulting Group, a global consultancy devoted to helping agencies and other professional firms create and capture more value. 

Ad Agencies And Their Holding Companies Fail At Their Own Branding

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

I read with great dismay and sadness about MDC merging KBS into an unknown (at least in the U.S.) Swedish agency (Forsman & Bodenfors) and obliterating the Kirschenbaum Bond name.  Without getting into the history of Kirschenbaum and its recent problems, all agencies go through up and down cycles, sometimes those phases go on for years.  But that is no reason to destroy the equity which has been built into the agency brand, especially one that is essentially positive.  The evidence is that once that brand name disappears, the new agency rarely fully recovers.  As a result, when it comes to mergers in advertising, one plus one often equals far less than two.

As every good marketer knows, building a brand name takes years, often decades.  Destroying the brand can take only a stroke of a pen. Changing or obliterating names can be confusing and dangerous for the brand.

One of my favorite stories is how Omnicom screwed up both Chiat/Day and TBWA. Omnicom merged TBWA into Chiat in 1995 and ultimately changed the name to TBWA, eliminating the Chiat moniker.  Yet, even today, especially in Los Angeles, Chiat’s headquarters, TBWA is still known as Chiat/Day. (TBWA was a stronger name in Europe and is rightfully called that in those markets).

Batton, Barton, Durstine & Osborn modernized and became BBD&O and eventually BBDO, which makes total sense. Ditto when Doyle Dane Bernbach was bought by Omnicom, it was changed to DDB/Needham (to accommodate the merger of Needham Harper Steers – but Needham was ultimately dropped); DDB was the stronger brand. Other agency brands are still confused by their own name changes.  JWT is still called Thompson or J. Walter or even J. Walter Thompson; I think I understand why that name was changed, but I could make a good case for having left it alone.  Ogilvy, which started as Ogilvy, Mather and Benson, and subsequently changed to Ogilvy & Mather, became just Ogilvy, but to this day is still often called O&M, even by its own employees (checks still are marked Ogilvy & Mather). Y&R is still Young & Rubicam, even if the full name is not verbalized. Changing a name does not change a culture.

When the founding principals of well-known ad agencies retire, merge or die, unless they made strong succession plans, the agencies often diminish or disappear and rarely recover if they are merged.  Saatchi & Saatchi, at least in the U.S., never achieved its potential when Compton was merged with Dancer and their name was changed to Saatchi & Saatchi.  Saatchi was on of  Briton’s more creative agencies and the two merged into it were heavily package goods agencies, more known for their ability to create effective strategy; for complicated reasons, Saatchi, at lease here in the U.S. never achieved the creative reputation of its London parent.  The merger never took into account the cultures of the two American agencies and the strength of their client relationships.  In the case of this three way merger, one plus one plus one ended up equaling about one and a half.

IPG merged Bozell and Kenyon & Eckhardt and then the two of them into FCB, which was subsequently merged  with Draft.  Now, what remains is a mere shadow of the original agencies.

In a mistaken effort to keep contemporary, merged agencies often drop the names of the founders, which may be unnecessary.  JWT is a perfect example of that.

So much of advertising is driven by creative personalities.  When it comes time to sell or merge the new agency people want their names to dominate, but that often destroys the equity which was achieved by the original agencies.  IPG was smart to leave the Deutsch name alone, even though Donny Deutsch long ago moved on. When IPG merged Lowe into Deutsch, aside from being a cultural disaster, they still kept the Deutsch name dominant. The people who ran Deutsch figured out how to keep their culture, despite often rancorous disagreements with the parent company (and occasionally, Lowe, which subsequently and smartly separated itself).

Kirschenbaum & Bond now joins a long line of wonderful creative agencies which simply disappeared after being merged and submerged – Ally & Gargano, Scali, McCabe & Sloves, Wells, Rich, Greene, Lintas, Ammirati & Puris are all examples of great brand names which disappeared out of the hubris of holding companies.

More often than not, putting these agencies together, without any regard to their individual cultures and differences actually ended up killing the brands, costing the holding companies millions of dollars in the long run.

What a waste.

Guest Post by PAUL GUMBINNER President of The Gumbinner Company, executive recruiters for the advertising industry.

Agency Owners — No Rest For The Weary?

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

Owning, leading or even just working in an agency is a fantastic gig. You get to be surrounded by wicked smart, witty, committed teammates, you get to save the day for clients on a regular basis and let’s face it, the work is fun most days.

We are lucky. Damn lucky. But we are also tired. Along with all of those privileges comes the worry of keeping the sales pipeline full, dealing with the human side of your team and clients (which can be both joyful and tragic as we all walk out our lives together) and long, arduous days (and nights, and weekends….).

Drew McLellan

We work at a pace that is fast and furious, shifting from one client to the next and often working weird and long hours. That is unsustainable without giving yourself some respite.

But we’re not so good about giving ourselves that break. It’s not about taking a vacation or a long weekend or just not checking email for 24 hours — it’s about survival.

Back when I was a kid in the business (call me 30 or so) I remember one of my mentors saying “This is a young man’s game, Drew.” And that was before the 24/7 connectivity we have now. I think he was both right and wrong. Our chosen profession does require an incredible amount of energy and passion but that’s not about being young. It’s about recognizing that it’s an endurance sport and we have to train and plan for that.

Here’s my challenge to you — when was the last time you didn’t check email for 24 hours? When was the last time you took 5 workdays off (in a row!) and played as hard as you work? Who (family, friends) are you not getting enough of in your life?

If you don’t like the answer to those questions — fix it. And then go to your 2018 calendar and schedule some breaks for yourself. Re-fill your bucket so you don’t come up empty.

This post courtesy of Drew McLellen, Chairman & CEO at AMI, Agency Management Institute and  President of his agency McLellan Marketing Group

 

THE SOLUTION FOR BEING TOO EXPENSIVE

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

It’s early January. My phone rings. It’s Sue, a former client I spoke with two weeks earlier. She had called to share she was leading a new firm and they were growing like mad. She needed our help again. I had always liked Sue. We did really good work for her and she’s a straight shooter. I trusted her. We also hadn’t worked together for quite some time and our prices were higher now and our process more finely tuned.

The conversation we had two weeks ago had gone well. I walked her through our process-framed case studies and gave her a proposal for the work with options. This was the green-light call, I was certain of that.

“Hello, Sue. You ready to hire us again?” I joke.

“Well, I wanted to talk to you about that,” her tone sombre.

Uh-oh. I knew she was looking at other firms. I suspected they were all local and generalist in nature. Is she calling to give me bad news?

“Okay…what’s up?”

“I know you can do a good job. But you’re just so much more expensive,” she says. “My firm is young. And your price is just….,” her voice trails off.

To keep the conversation from turning from bad to worse, I jump in.

“Sue, do you mind if I ask you a question? Is your firm trying to be the low-cost provider in your sector?” I know the answer.

“No, of course not.”

“Well, neither are we. I know you’re looking at other firms, and there are some good designers here locally. But let me tell you why we’re worth every penny. Then you can make your decision. And if the decision is not to hire us, that’s fine. We’ll still be friends, okay.”

“Sure.”

“So the first reason we’re worth it is that we specialize in your sector. And this gives us insights that other firms won’t have. Are the other firms you’re talking to going to be able to hit the ground running, or are you going to have to start by explaining in excruciating detail exactly what it is you do? You know me, Sue. We’ve worked together before. You won’t have to train my team. I’ve already done that for you, by working for dozens and dozens of firms in this sector.”

She says something non-committal. At least she’s listening. If I go down, I’m going to go down swinging.

“And Sue, we’ve shown you exactly how we work. I walked you through our process-framed case studies. We’ll take you through each step in that process, just like we do with all our clients. Now, did any other firm show you exactly how their process is going to work, or did they just wave their hands a lot?”

Again, a non-committal answer. But I think I’m making headway, so I keep on. Next, I make a strategic move.

“And Sue, you know you can split this project into two portions. We’re better than anyone on the planet at strategy…” Did I really just say that? “…so why don’t you hire us for the strategic part, and then you can give the tactics to some low-cost (inexperienced) pair of hands?”

I’m doing what Win Without Pitching calls “stepping on the tactical to raise the strategic.”

This has worked with other prospects in the past. Once we finish the strategic component, it’s actually pretty tough for the client to go elsewhere. Their comfort level and their confidence in our abilities is pretty high by that point. But it doesn’t work this time.

“No,” she says. “I don’t want to split this up. All that will happen is the second firm will say, ‘Well, we wouldn’t have done it that way.’ So the results will suffer. And I don’t have time to babysit this process. I’m looking for a firm that can act as my marketing department. I’m too busy to babysit them, or to play referee.”

“I totally understand that, Sue. You don’t want to have to play referee. Our goal is to deliver great results for you, which is why we put together the proposal and price options the way we did. We can handle all your needs.”

“And Sue, there’s one more thing I want to say. I normally don’t do this for very many people, but we’ve worked together before and I trust you. So I’m going to do something I don’t normally do. I’m so confident that our process will deliver great results that I’m going to give you a money-back guarantee. How many other firms are that confident?”

“Not very many.”

“That’s right. So, you want to know whether we’re worth the investment. I understand that. I’ve given you three reasons. First, we know your sector. You won’t have to train us. Second, we’re going to be following a clearly defined, well-honed process. And third, I’m giving you a money back guarantee. If you get to the end of the strategic phase and you don’t think our deliverable will work, then you give us one chance to fix it. If we don’t fix it to your satisfaction, I’ll give you your money back.”

There’s a silent pause.

“Sue, this reduces your risk a lot.”

“Hmm…” She’s thinking about what I’ve said.

“Sue, what concerns do you have?”

“None, I just need to think about it.”

“Okay. That’s fine. Again, I want you to know that I’ll respect your decision, no matter which way it goes. As you think about it, if you have any other questions, give me a call, okay?”

“Okay.” There is a pause. “Oh, I do have one more question.”

“Sure.”

“Well, we had a really good year last year, and I need to get some money off my books. Can I pay you for the whole year in advance with money from last year?”

I laugh. “Yes, Sue, I’ll take your money, no matter what date is on the check.”

She laughs too. We trade some pleasantries and hang up.

Less than a week later, I have a check in my hand for more than a quarter-million dollars. She never negotiated the price.

What just happened?

Maybe she called to tell me I didn’t get the job. Maybe she called to negotiate on price. But she called. And I won the work at a higher price than any other supplier.

Reading this conversation, ask yourself how confident I sound. Pretty darn confident, right? Where does that confidence come from? It comes from the expertise my firm and I have built in our one sector.

And how does this expertise manifest itself? It manifests in expert processes.

And the money-back guarantee is a great way to back that confidence with action. I know that most challenges are no match for the systems we use to develop a solution. Yes, there are outliers, those thorny, horrendous problems that cause my team to stretch and sweat. But I’d asked enough questions to know that Sue’s challenge isn’t one of those. So the risk I’m running in making the offer is very, very small.

Our expertise and the resulting confidence also manifests in expert sales processes. I knew how to help her reach a decision that would be in both our interests. Thanks, Win Without Pitching, for all you’ve taught me.

The Money Back Guarantee Step-By-Step

When I first heard Blair talk about offering a money back guarantee, I was deeply skeptical. No, worse than that, I was frightened at the thought of actually having to write out a check. I’m sure many of you feel the same way. But I’ve been using them for a while now and I’m here to tell you that they’re a lot less scary than they sound. I’ve made this offer three or four dozen times, and I’ve closed a fair share of those and no one has yet to ask for their money back.

I urge you to use money back guarantees. They’re incredibly powerful. The firm that offers them exudes confidence. And that’s exactly what the prospect is seeking. At the end of the buying cycle, buyers need reassurance. Many of your prospects don’t buy what you’re selling very often, so they’re unsure. They need to understand that you represent a safe choice. They need confidence. And that’s exactly what a money back guarantee provides. You’re offering to take their financial risk down to almost zero.

The Components

First, only guarantee the strategic portion of the engagement. It’s too easy for the tactical details to go sideways. When I was talking to Sue, that’s what I did, guaranteed just the strategic portion.

Second, you have to require the involvement of the principal. They can’t disappear while you’re doing your work, foisting you off on some low-level person with no power and no vision, only to pop back in and say, “Well, that didn’t work. I want our money back.” I didn’t require this of Sue, because I knew that she would need to be deeply involved in our process. That’s the way she works.

Third, the less “fine print” you have the better. So, no caveats, no exceptions, no escape clauses. This should feel like a handshake deal, not like one where the lawyers have to redline every clause. This is where you need to have the courage of your convictions. The only thing I told Sue in this regard was one minor detail: if it’s wrong, you give us one chance to get it right. But there was no other fine print.

Fourth, there needs to be a limit of some kind on the guarantee. Typically it’s a time limit. The guarantee can’t go on forever. This was implied in my offer; our strategic offerings only last a few months.

Fifth, give them a range of options. “We’ll get to the decision point. Then we can decide to proceed, or we can decide to stop, or we can decide to stop and I’ll give you your money back.” This fifth point is not strictly necessary, but it’s a more realistic representation of the possible futures than just: “You get your money back or you don’t.”

How to make the offer

When it comes to making the offer itself, here are some tips:

  • Make the offer to one person, not to the whole room. This will be the highest ranking person at the prospect company.
  • Look that one person in the eye. Focus on them. Smile. You want to humanize this moment.
  • Slow down. You’re making an incredibly important point. Your audience should sense the room lights dim and the spotlight on your face grow brighter.
  • Tell them that you don’t do this for everyone. (That’s true, isn’t it?) They’ll feel special.
  • Frame your offer as a way to reduce their risk. You can call it “financial risk” or just “risk,” but you want to highlight the benefit for them.
  • Be confident. Exude trust and power, even if you’re shaking on the inside. This kind of offer is the mark of a supremely confident professional. It won’t work if you telegraph your doubts through tone of voice or body language. Don’t mumble. Speak up.
  • Place your offer carefully into the flow of the meeting. You probably don’t want to lead with it. Wait for the right time, and once you start, don’t let anyone interrupt you. Once you make the offer, pause. Let the silence stretch. You want to sear this moment into their memory.
    Then ask a strategic, high-gain question. The one I asked Sue was a variant of this one: “How many other firms are so confident that they can deliver outstanding results that they’re willing to guarantee their process?” You want to distance yourself from the competition.
  • Practice by making the offer to a few “gimme” prospects first. These are the prospects that won’t ever take you up on it, or where the cost of failure is so low that you could afford to pay them back. These types of situations are low risk for you. In using these as practice, you’ll learn what it feels like to make the offer, how the words sound coming from your mouth, and what types of responses are typical.

What could I have done better?

Thinking back over the conversation I had with Sue, there are some things I could have done better:

  • I should have sent her an email right after our conversation with the guarantee spelled out. This would have hammered home the point.
  • I probably shouldn’t have spent so much time questioning my competition. I was trying to draw distinctions, but looking back, I feel I might have overdone it.
  • I could have been much more clear about the three choices: if you don’t like it, we get a chance to make it right, in which case we’d proceed. But if we can’t fix it then we can decide to stop, or we can decide to stop and I’ll give you your money back.

That’s okay. I’ll do better next time.

Did Sue take me up on that offer of a money back guarantee?

We recently wrapped up the strategic engagement portion of the project with Sue. I had all 8 members of her leadership team in the room as my team and I walked through our findings and recommendations. At the end of the meeting, we do what we always do: ask them to fill out an NPS (net promoter score) survey. We got 9s and 10s from everyone, so our NPS score is 100%.

The next day I came into the office and sent Sue an email.

Sue,
I neglected to say one thing in our Monday meeting. I doubt I actually need to say it, but just in case, here goes:
Do you remember the sales conversation we had at the beginning of the year? That’s when I offered you a “money-back guarantee” on the strategy portion of our engagement.
Well, the strategy is set, so if you want your money back, now’s the time to ask.
Otherwise, full speed ahead.
David

Her response was simple:

David
Full speed ahead
Sue

By Win Without Pitching Coach David Chapin

MANDATORY READING – If new business wants more respect, it needs to become more proactive

Written by ChuckMeyst2015 on . Posted in Blog Posts, Business Development

Editors Note:  This passed my desk today and I shared via LinkedIn and FaceBook with the headline:

My God, this man has got it! And it took an outsider to make the point so simply clear. Attention all New Business Coordinators. Either step aside or learn what it takes to do new business as it needs to be done. (And if  YOU are a NB person take heed. And if you’re an agency owner/Manager, please pay attention).

There’s recently been discussion that the industry needs to support its new business managers more. As one myself it’s no surprise that I whole-heartedly agree with the sentiment: new business for any industry has a direct impact on a company’s growth, and there is nothing more important than this both culturally and financially.

However, I can’t help feeling like the role of new business has potentially lost its stature because we, as new business professionals, have let it happen.

I have only been working in the advertising industry for a few years – before I joined ad-land I worked in various ‘hard sales’ roles. And as an outsider looking into the industry, its definition of new business wasn’t really what I regarded as new business.

To me, new business has always leaned more towards a sales role than anything else. It has always been about developing narratives to persuade your target market that your product or service is the hand-in-glove fit for them and the answer to all their challenges. It is the proactive searching of the market to find clients that will benefit from your offering and then once you find them, building that relationship with them.

The admin has always come second for me. Don’t get me wrong, what comes after the initial contact is still absolutely critical to successful new business. But the hierarchy should always be proactive first, reactive second.

This is how it works in most new business roles, so why should it be different in advertising?

I think perhaps that new business departments or individuals have let their role become devalued. In far too many cases, the person responsible for new business in an agency is seen as the person who expertly answers the incoming RFIs or puts together the credentials document before an important client pitch or meeting. This isn’t new business; it is inbound admin at best.

The concept of waiting for briefs to come in is something that really grinds with me. In years gone by, the bigger, more established agencies have had the luxury of RFI after RFI landing in their inbox.

However, with the changing media landscape – as well as more and more clients looking to a wider range of agencies – this luxury is likely to become a rarity. Agencies can no longer afford to have their new business teams or individuals as in-bound sales or admin people.

The process of building relationships and actively trying to speak with prospects has become a lost art within the advertising industry.

‘Content is king’ is something that you hear at every new business breakfast, seminar and networking event. Yes, it absolutely is, but what is more important is what you do with that content. Posting content on your website or social channels is the easy part, but if we are honest it requires little effort.

Proactively shoving that content under the nose of your number one new business target in an engaging way is much harder. It can be easy to shy away from the harder work when it has become accepted wisdom that new business is more inbound then outbound.

If we want new business to be truly considered at the top table as a key cog in the machine – if we want our voices to be heard – then new business needs to stick its neck out. It needs to fight really hard to become a respected part of an agency’s makeup again – not by answering RFIs, building decks and getting good coverage in the trade press but by becoming more proactive, more outward facing and – essentially – more like sales.

It needs to take responsibility for driving the agency forward and making sure that every single person in the building comes on that journey.

Only then will us new business managers get our voice, one hustle at a time.

Jack Williams is head of new business at Atomic London

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