Peter Levitan & Co.
The New Business of Advertising
Need a marketing headache? Well, according to Gartner you should already have one. Check out this chart that makes it all look like a train wreck ready to happen. That’s the bad news.
The good is that savvy advertising agencies should be able to use this level of complexity to offer aspirin-like services.
A couple of people have asked why I’ve slowed down my blogging. Like most of you, I’ll take any chance to slay this insatiable beast.
OK, what’s up? I’ve been putting my typing into writing the world’s greatest, smartest, must have book on agency pitching. Here is where things stand.
Working title:
What is it: A real old-fashioned paperback book printed with ink and paper and eBook detailing the best practices for designing, writing and presenting new business pitches. It leverages my 30 years of participating in and leading new business pitches… and some deep seated attitude. It will also include my story of the world’s worst agency pitch for the global Adidas account when I was at Saatchi & Saatchi London. I’ll support the book with an active website that will include agency leader insights and tools that every agency can use to better mange their pitch development.
Reason for being: According to advertising agency staff, the process of creating a new business pitch sucks. Read my post, “Half Of Advertising Agency Staff Hates Pitching.” I think that poor pitch management dramatically reduces an agency’s odds of winning. (This is a “duh” right?)
Status: I’ve written about 27,000 words. Will add another 7,000. I’ll also include interviews with experts like agency search consultants, procurement experts, a lawyer on IP and one of the best creators of 3D leave behinds. I’ve started designing the book and its website.
Stay tuned. I hope to publish this spring.
Poorly managed advertising, design and PR agency meetings waste time, kill creativity and cost money. This is a particularly nasty problem in the over-heated world of agency new business pitches.
We know from a recent research study of advertising professionals by Provoke Insights that agency employees are dissatisfied with the agency pitch process.
“Approximately half (47% of respondents) of advertising professionals surveyed by Provoke Insights say they are dissatisfied with the current internal approach to pitching.”
As a long time agency new business professional, I know that one of the worst “approach” offenders is the poorly managed pitch planning meeting. Worse, poorly managed pitch meetings could lead to losing the pitch itself by making the entire development process less efficient.
If you are the pitch team leader your job is to manage the pitch process so the agency will deliver the best response it can. I’ve always believed that meeting management is the first place to start.
In 1986 I moved from Dancer Fitzgerald Sample’s New York office to Minneapolis to manage our Northwest Airlines account. I was invited into the client’s inner circle and attended their senior management meetings as the advertising agency representative. These were the good old days when the agency’s opinion on marketing was considered critical to the client’s success.
I quickly realized that Northwest had a serious meeting problem. Most of my clients seemed to be in non-stop meetings from 8AM to 6PM. I couldn’t figure out when they had time to think let alone get their jobs done. This fact wasn’t lost on the CEO who hired a management consultant to help create an efficient and effective meeting culture. It was instructive to watch this course correction help Northwest to be the fastest growing airline in the late 1980’s.
Effective, well-managed meetings deliver three key benefits:
Here are the 10 rules I picked up at Northwest.
The pitch itself should be well stage-managed. These rules should be considered (I stress considered) in how you mange the actual client presentation. Clients will respect you when you show respect for their time and show that your agency is well-managed.
Call me. I’ll help you win more new business.
Every January I asked my agency’s senior advertising clients “How we doin?” Actually, I asked the question cloaked in a slightly more sophisticated query. Sounding like Governor Christie or the Sopranos [“How we doin?” ] might not work as well.
Our more sophisticated approach to determining if our ad agency was loved used the concept of Net Promoter Score to help us dig into the heads of our clients. We wanted to know if they were truly satisfied with the agency and our services.
We managed our request with the understanding that clients are very busy and that having a long questionnaire would add more work to their already busy day. We found that the concept of Net Promoter Score helped us meet our annual survey needs and showed our clients that we were smart. There was one more fabulous business-building benefit as you will see.
The concept of the Net Promoter Score (NPS℠) was developed in 2003 by Fred Reichheld, a partner at Bain & Company. The objective of the NPS is to determine how well an organization generates relationships worthy of loyalty. As Bain says:
Net Promoter System℠ is based on the fundamental perspective that every company’s customers can be divided into three categories. “Promoters” are loyal enthusiasts who keep buying from a company and urge their friends to do the same. “Passives” are satisfied but unenthusiastic customers who can be easily wooed by the competition. And “detractors” are unhappy customers trapped in a bad relationship. Customers can be categorized based on their answer to the ultimate question.
The best way to gauge the efficiency of a company’s growth engine is to take the percentage of customers who are promoters and subtract the percentage who are detractors. This equation is how we calculate a Net Promoter Score for a company:
We sent the NPS questionnaire, which asked the simple question along with the opportunity for the client to elaborate on why they gave us a particular score, with the following letter. It worked for us and might for you. Oh, it also subtly told clients that is was cool if they in fact referred us. We liked referrals… Referrals delivered motivated new business prospects that came with a higher degree of motivation, shorter sales cycles and a higher close rate.
Here is how my agency Citrus delivered the questionnaire:
Ms. Cynthia Johnson
SVP Cheif Marketing Director
Widgets R U, Inc.
Re: 2004 Citrus Client Survey
Dear Cynthia,
Every year Citrus asks its clients if they would fill out a multi-question agency evaluation form. This evaluation process helps us to know if we are providing the level of service our clients expect and need. The survey also asks if there are any additional agency services that Widgets might want us to provide in the future. We have used the input of our clients in the past to modify our service offering, when required.
This year, we are going to take a different approach from the multi-question survey we have used in years past. In 2004 we are only going to ask one question:
“How likely is it that you would recommend Citrus to a friend or colleague?”
We are basing this question on research findings reported in the Harvard Business Review article “The One Number You Need to grow.” This very interesting article suggests that there is one simple question that can provide much of what a company needs to know about how its customers perceive its services. As the article states, “You simply need to know what your customers tell their friends about you.” The HBR article is attached for your information.
Please take a couple of minutes and help us help you by completing the enclosed survey. Our goal is to keep building a better agency for all of our clients.
If you have any questions give me a call. As always, your answers are considered confidential and will only be shared with agency management.
Thank you for your time.
Sincerely,
Peter
The letter and Net Promotor question told our clients that we were interested in knowing how they rate our services; that we are smart enough to know about things like Net Promoter Scores and that we, as I stated earlier, like to be referred.
Give me a call if you need more business building insights for your agency. As you can see, smart business development tactics include how you talk with your current clients. There is gold in them thar relationships.
New Year’s resolutions work. Well, at least some do. The bottom line: at least give them a chance.
Here are ten 2014 resolutions for advertising agencies that I think your agency should make. I mean… really do if you want to grow your advertising agency and your bottom line.
1. We will strive to create an agency brand position or business model that stands out from our competition. This will be designed to give prospective clients a compelling reason to want to work with us. Let me help you out here.
2. We will write and execute an annual business development plan that uses both inbound and outbound marketing. In fact, we will start by updating our master business plan. Too much has changed in the past twelve months to not revisit all of our assumptions and objectives.
3. We will manage and run our business development program with consistency. We will not start and stop. It is too late to restart a new business program after loosing a large client.
4. We will not pitch every account that comes our way. The pitch process is simply too costly. Before we pitch any account we will work hard to determine if the prospective client is a good fit for the agency based on a set of predetermined criteria. Here is a start. Is the client famous? Do they respect marketing? Do they want us to do brilliant work? Will they pay well? Are they a cultural fit? Hopefully you can say yes to two or three of these.
5. We will establish a recommended agency compensation plan and will share this with current and perspective clients. This plan will include cost-plus, fixed fees and performance-based remuneration based on a client’s performance metrics and an annual agency review. I’d like to se agencies get out in front of this issue.
6. We will ensure that we provide more value to all existing clients than we did in 2013. We will make sure we know how to prove our value.
7. We will give our people the time to fully explore the marketing value of new media or communications technologies. Some savvy agencies jumped on Vine when it was introduced and used it to build agency awareness.
8. We will work to grow our expertise in mobile and video marketing, the two fastest growing segments. To not do this will kill us.
9. We will write the book we want to read. I stole this line from Austin Kleon’s “Steal Like An Artist.” I wrote about why advertising agencies like The Gate Worldwide write books to grow their awareness for the blog Agency Post.
10. Have Big Hairy Audacious Goals. Go for it this year. I firmly believe that without BHAG’s agencies will wither away.
We will call Peter Levitan and take him up on his Vito Corleone offer. We have nothing to lose and so much to gain from his new business insights. No, I don’t think that humility is a business-building attribute.