Hot off the presses. I received an advance copy of the RSW/US 2023 Agency New Business Report. Since 2010, they've been collecting data to give agency owners a comprehensive look at trends shaping our industry. Over 3,000 agency leaders across the U.S. weighed in this year, providing unique insights into the evolving business development challenges and dynamics as we close out 2023 and gear up for 2024.
The 2023 business development landscape continues to be challenging for ad agencies, marketing firms, and PR agencies alike. According to the report's findings, we're all grappling with fewer referrals, shrinking budgets, and elongated sales cycles. But all is not lost. I've recapped the report's highlights and provided you a link to download your copy. Best of all, if you stick around until the end of the post, I'm giving you a simple three-step process to jump-start your agency's business development program.
It’s Getting Harder to Win New Business
58% of agencies reported that gaining new clients in 2023 has been more challenging than in 2022. That’s the third-highest percentage since RSW started tracking this stat in 2008, and it’s 23% above the 15-year average.
35% of agencies reported that the difficulty of business development efforts is the same, and only 7% said it was easier this year vs. last year.
Interestingly, “harder to break through to prospects,” historically the main reason associated with business development challenges, fell to third. Fewer opportunities out there (61%) and prospects’ budgets too small (55%) were the first and second most cited rationales. “prospect budgets too small” was a new question this year. So we should probably take that with a grain of salt.
Agencies Are Taking Business Development More Seriously
Over the last three years, the percentage of agencies claiming they didn’t have a business development process fell from 36% in 2021 to 13% this year. And 36% of them hired a dedicated new business director this year, up from an all-time low (32%) in 2020. Unfortunately, 44% of agencies reported their last new business hire was unsuccessful.
I tend to agree with RSW’s take on the challenge.
- Agencies mistakenly think they’re hiring the person’s network. If the person’s primary tool is 1:1 networking, they’ll be hampered in a digital-first, increasingly virtual world. 1:1 selling doesn’t scale well, so agencies need a strategically focused, ongoing business development program.
- They hire green. I get it. Experienced salespeople are expensive. But, unless the agency owner is themselves an outstanding business developer, there isn’t anyone on staff to coach up the newbie.
- The devil’s in the details. Good salespeople are good at making their ideas sound amazing. But as agency owners, you owe it to yourself and your staff to push back on your potential business development director’s plans and ideas. Stress test them to see if any cracks appear.
- Misdefined expectations. There has to be a process, and this person has to play a role. Too many agencies wrongly assume they’ll figure that out once the person is on staff. Don’t do that. Clearly define expectations and then hold your business development leader accountable.
Agencies Aren’t Satisfied With Their Business Development Programs
56% of agencies reported dissatisfaction with their biz dev program in 2023, up from 48% in 2021. There were several open-ended reasons for agencies’ feelings, but this one best sums them up.
There is no plan here. Principals are too busy with overwhelming existing work and may not fully understand the value of constant new biz efforts.
While not listed in the report, based on my interactions with agency owners over the last few years, I’d add that most of these principals aren’t just too busy; they don’t have the proper training or natural selling skills to lead their business development efforts once their referral stream dries up.
I base that on RSW’s data. When they asked agencies to indicate their most effective business development tools, the top three answers were referrals, new business from existing clients, and networking. Less than 30% of agencies felt public speaking, SEO/SEM, marketing automation, or email campaigns were the most effective channels to produce new business.
In a world where agencies find it harder to break through to prospects, and those prospects are slower to respond and dragging their feet once it’s time to start the work, a consistent flow of new, qualified leads is necessary. If your agency is lucky enough to have a constant flow of referrals, good on ya.
But for everyone else, your long-term financial success depends on always having another qualified prospect engaged and seriously considering hiring your agency. And that means you have to plan to stay in front of visible and invisible prospects in a meaningful way.
How Agencies Should Approach Business Development
If you believe RSW’s data is accurate, and I see no reason to doubt it, and you’re one of those dissatisfied agencies, this is what I suggest you do to immediately improve your business development efforts.
STEP 1: Build Your Business Development Strategy It doesn't have to be overly elaborate. Spend a day and define these THREE key points:
- What you sell: be specific. For instance, I used to handle business development for an agency that was exceptionally good at direct-response print advertising (yes, this was early in my career). So while we were happy to talk with a CPG company, we prospected for potential direct response clients.
- Who you sell to: again, be specific. Less is more in sales prospecting. If you’re trying to talk to everyone, you’ll be heard by no one. I’ll give you a personal example. When considering who will buy our agency business development training offerings, I focus on privately owned agencies employing between 11 and 20 people. I’ll open the choke up to agencies with 50’ish employees, but I seldom prospect for larger agencies. Does that mean larger (or smaller) agencies can’t benefit from our agency business development training? Absolutely not. I just know that the sweet spot, in terms of conversion percentages and time to contract, favors those smaller, 11-20 person agencies.
- Where you should sell: as I have been preaching for the last decade, define your Propinquity Points. If you need help, here is an excellent digital tool that makes it easier to discover high value propinquity points. And then make a plan to repeatedly show up at those points in the form of people or content.
STEP 2: Stock Your Business Development Toolbox Don’t get caught up in buying a lot of expensive software. An effective agency business development program needs four key components.
- First, you need a CRM. It doesn’t have to be a full-fledged marketing automation tool like SharpSpring (what I use) or Hubspot. My personal favorite is Nimble. It’s inexpensive, web-based, and has a fantastic mobile app. Even though we use SharpSpring for our website tracking and email marketing, I still maintain a Nimble subscription and have it mirror our SharpSpring database because the mobile app is more useful when networking at conferences. Use this CRM tool to keep track of every conversation you have with prospective clients over time. Use it for basic email marketing and scheduling your planned nurturing activities.
- Second, you need a content curation tool to quickly and easily assemble helpful content to share with your ideal prospects. At a minimum, a Google Sheet where you save content you find. Or better yet, spring for a Feedly subscription that makes it easy to find and share content across multiple digital channels.
- Third, start publishing content. Keep it simple and helpful. If you don’t have enough time, summarize relevant research (did you see what I did there?) or introduce prospects to helpful tips and tricks like this video I created explaining this game-changing new LinkedIn Sales Navigator feature. Download a great podcast and transcribe it. Then summarize the transcript, add your unique spin to what was discussed, and publish on your website with a link to, or an embed of, the podcast episode. Eventually, if you want to ascend to “thought leader” status and truly harness the power of The Invisible Sale, you’ll need to create unique content. But for now, channel your inner cliff-notes writer.
- Fourth, build a set of effective email templates. And then use them! Simple, effective email templates and a well-curated CRM are gold for business development. There isn’t an easier, more effective way to consistently reach out and personally touch many prospects without spending much time doing it. Do you need a few starter email nurturing templates? 👈 Grab mine. You’re welcome.
STEP 3: Launch Your Business Development Program Again, don’t over-complicate things. Perfection is the enemy of progress. Just do these five things immediately.
- TAG every person in your snazzy new CRM. Tags are the best way to segment your prospects inside your CRM. I have a terrible habit of over-tagging, so don’t go crazy. Start simple with things like Biz Dev (to identify potential prospects), B2B, B2C, Industry, Target Types (maybe you're a Gen Z specialist agency—you’d want to know which prospects target Gen Z), marketing channel (SEO, Social, etc.). I could go on, but you get the idea. I’ll revisit why this is important in a second.
- Create your “First Year Cadence” Activity Template. Map out a year’s worth of touches that every single prospect will receive upon finding their way into your CRM. Then schedule that template with every person in the CRM. HINT: Space out the start dates when scheduling your first year of touches with your CRM contacts. Schedule the first five people in the CRM to start passing through their first year on day one. Then schedule the following five folks to start on day two. Rinse and repeat until you’ve scheduled everyone. Depending on the size of the CRM list, you may have prospects that won’t receive an initial touch for a few weeks. Keep this in mind when scheduling — prioritize your best or most desirable prospects.
- Schedule time every week to curate content. Even better, schedule time every day. I like to do it while having coffee in the morning, or if I'm doing a once-a-week curation, I’ll visit the pizza place next to my office on $2 local drafts day. Hey, whatever it takes, right??? 🍺 🙌
- Be a slave to your CRM. Every day, open that CRM and process every task assigned to you. It will be difficult at first but push through it. In business development, discipline delivers. If you’ve spread your touches across various channels (social media, email, snail mail, phone, and face-to-face), you should be able to finish your touches each day relatively quickly.
- Grow big ears and eyes. Hat tip to Chris Brogan, from whom I stole this fantastic quote. Pay attention to the content swirling around you every day. Don’t focus on what interests you. Focus on what interests your prospects. Then consume and share that content with an insightful thought. Use the content to create opportunities to have conversations. Then turn those conversations into clients.
Need Help Jump Starting Your Business Development Program?
If this all still seems a little overwhelming, let us help you. We offer a range of agency business development resources ranging from free, helpful content like this article to one-on-one coaching, online courses, a powerful agency pricing template & proposal builder, and customized business development workshops and training programs. Or if you need something else, why not schedule a call with me to see if I can help?
