Peter Levitan & Co.

The New Business of Advertising

Pitching

Expedia And Sales Chutzpah

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A Lesson From Expedia On Sales Chutzpah

Screen Shot 2017-05-20 at 5.02.30 PMOK, we all have bad customer service experiences. I get it. But when the bad experiences go across four Expedia service phone conversations (that lasted about three plus hours over two days) and another six back and forth Twitter direct tweets and the customer who is spending over $5,000 on the trip is still unsatisfied (that’s me), there must be something wrong with how Expedia runs the humanbeing (vs. digital) sales service side of its business.

No, This Post Is Not About Expedia. It Is About Your Ad, PR, Digital, etc. Agency

Stick with me because this blog post is actually about a way to grow your agency – a way that requires a bit of chutzpah. However, before I get to your agency and an unignorable sales tactic, I have to share a tiny bit of customer service related background to set up the chutzpah recommendation.

A few weeks ago, I used Expedia to book two tickets from Mexico City to Budapest for a summer trip to see the Hungarian F1 Grand Prix race. This week, I called Expedia to change the trip by adding a few days up front and move the original first destination from Budapest to Vienna. I knew about and was willing to spend the extra $500 flight change charge and, before I called, I had also looked at all of the available flight options. I was prepared for the service rep call. But, I was not prepared for the following:

Expedia’s phone system could never recognize my itinerary number or phone number (the ones that are listed on Expedia’s original flight plan document). I knew I was in the system because when I finally got to a rep, she recognized the numbers. What’s up with Expedia’s automated phone system and the interface with its database?

While it took me about 30 seconds to get to the Iberia Airlines and Expedia sites to find my reservation detail, it took the multiple Expedia reps I talked to at around two minutes.

I was repeatedly asked if Mexico City was my origination airport (I live in Mexico) and if I was to change flights in Madrid as stated on my reservation. Um, yes.

The reps took forever to find alternative flights although I was helping them find the alternatives. And on. I won’t bore you with more including the third rep who apologized for how sloooooow Expedia’s computer was working.

Taken individually, these don’t appear to be too onerous. However, in aggregate, they were and I gave up without making the flight change.

OK, two more points.

I was so pissed off that I sent LinkedIn InMails to three Expedia marketing execs gently complaining about the service and asking them if they ever sat in on customer calls – consider this action an internal “Store-Check”. It’s been four days since I sent the emails. Any response? No. Sure these folks get lots of emails. But, I used attention-getting customer-centric subject lines.

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The Cost Of Ad Agency Business Development

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Ad Agency Business Development. What Does It Actually Cost?Screen Shot 2017-05-13 at 9.53.38 AM

Simple answer? Ad agency business development costs… a lot. A more detailed answer follows.

I recently spoke about ad agency business development (essentially the art of Account Based Marketing) at Hanapin Marketing’s PPC Hero conference in L.A. and did a day long ‘how to pitch’ workshop for a major agency network at their annual meeting in Miami. I came away from both sessions thinking about the high cost of business development.

The True Cost Of Business Development

Since there is no one size fits all answer to what BD costs, I am going to illustrate the cost for a typical medium sized agency. Based on many conversations with agency leadership and the research done for my book on pitching (see the top of this page or just go here to buy it), the cost of participating in a serious pitch can cost close to $100,000. Sounds high, right? But, here is my math.

I am making the assumption that a typical medium size agency responds to 10 RFP’s and participates in 6 serious pitches per year. Of course, your mileage may vary.

RFP’s cost $15,000 to write and produce. This includes both hard and soft costs as in labor and overhead. At 10 RFP’s per year, that’s $150,000.

Pitches are more expensive.  Lets go with $35,000 per pitch. If you are an active agency, you’ll do 6 per year at a total cost of $210,000. FYI, I’ve run pitches at Saatchi & Saatchi that cost over $100,000. Not at all happy about that but that is a fact at the huge agencies pitching for huge pieces of business.

OK, back to the mid-size agency. The annual agency cost for RFP’s and pitching is $360,000.

But, there is more and I am going to be very conservative here. I am going with $200,00 per year for the cost of an active business development program itself. That’s the hard costs and the cost of a BD director and significant management time.

The total… $360,000 plus $200,000 = $560,000 or $56,000 per RFP and $93,333 per pitch.

Ouch.

Business Development – A Cost Center Or Opportunity?

The big question at many client companies is whether or not marketing is a cost or a business opportunity. Of course, you tell your clients that it is an opportunity that pays for itself. No marketing, no sales. Well, this is the case at many agencies. They simply do not spend the effort (as in time, investment and planning – oh, and execution) to run smart aggressive business development programs. As both an ex-Saatchi guy and small Oregon agency owner, I am blown away by this.

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How Digital Agencies Win Clients

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How Digital Agencies Find (and Keep) Clients

Screen Shot 2017-04-04 at 8.56.39 AMI was interviewed for the DM News article, “How Digital Agencies Find (and Keep) Clients”. Were my comments brilliant? Well, brilliant might be a stretch. But here are my key points.

Referrals – The Default Business Development Tool

Where do clients come from?

“The traditional rules of marketing have not changed,” says Peter Levitan, former agency executive and owner, now a self-employed strategist. “The primary way, the default, is referrals.” Levitan says. “Who doesn’t like referrals?”

So why is it that word of mouth is the way agencies get business? “They do not have an active business development program,” Levitan says. About 60% of all agencies have no business development plan. “That is the problem of being in a low-margin industry….finding the manpower to run  business development when you spend 10 hours a day taking care of the client.”

Takeaway. I love referrals and have a master plan for how to actually manage a referral program, Too many agencies are passive about getting referrals from friends, family and current and past clients. Hey, ask people to refer you. Have a plan.

However, the issue with referrals is that mot agencies rely on them to get new business because they do not have a proactive 24/7 business development plan. Referrals become the default new business tool.

The Power of Insights

“I suggest providing an insight the client does not have,” Levitan says. Google Survey is a good place to start looking for those insights, he noted. Finding that insight “will get you new business,” he says.

Levitan gave one example from personal experience. While trying to get a non-profit to sign on, he pitched this insight: the public perceived the organization as one of the five most well known, but least in need of donations.

Pitching the crucial insight harkens back to the Mad Men era of advertising in the 1960s, when ad agencies pitched on the basis of the “one big idea”. Levitan explains that today, “ad tech rules. The Mad Men days of the big idea have been pushed to the back burner.” Digital firms lead with technology, but “forget they are dealing with humans.” he added.

Actually, the non-profit story is about an agency that hired me to help them win more new business. I’ve helped them achieve their goal. One piece of advice I gave them was to lead every pitch with a very compelling insight. I bet that sounds easy. It isn’t. It can’t be just any insight. It has to be an insight that the client never thought of.  But, you know that.

A great insight tool is Google Consumer Surveys. Try it out.

Or, just go to my Let’s Talk page and I’ll help you out.

 

 

Podcast: 7 Tips for Ad Agency Professionals

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A Podcast Interview: My 7 Marketing Tips For Ad Agency Professionals

Screen Shot 2017-02-21 at 10.31.43 AMI’ve discussed the great value of guest posting in earlier blog posts. The primary advantage is that you get your post and thinking out to a much larger audience than you would get by just posting on your company website.

Another way to get your message out there is to be interviewed by a company that is interested in what you have to say. In a recent case, I was interviewed by Paul Wicker of the super-smart ad tech company ADSTAGE. Here is how they describe their marketing platform. Cross-channel campaign creation and performance in seconds

Identical Workflows for Cross-Network Campaign Creation

Create campaigns faster with a simplified and seamless flow across Google, Bing, Facebook, LinkedIn, and Twitter Ads. We support the most popular ad formats on each network so you can make most sense for your online ad campaigns.

Bottomline is that they can help you to better manage your multi-platform campaigns…. and isn’t that a very nice thing.

My PPC Show Interview

You can listen to the PPC Show interview and see the synopsis right here on ADSTAGE’s website. Below are a couple of the more (if I do say so myself) salient points… If you have been reading my blog, you know that these are two of my major business development recommendations.

  1. “We’re in a world where specialization wins.” If you’re looking to start your own agency, know that clients are looking for specialists. We’re no longer in the grand old days where agencies were either television, print, or radio. Know your specialty and make sure clients know it, too.
  2. “Your website HAS to be a sales tool.” So many agencies fall into the trap of turning their websites into fun, creative projects or brochures. While that’s all well and good, if your website is not set up to make a sale, then it’s not doing much for you. Sales is a 24-7 game now and your website is doing a lot of that work for you. Make sure it’s set up that way.

I hope you enjoy the interview. And, don’t forget to take a look at ADSTAGE’s ad tech tools and dashboard. I love dashboards…

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The Advertising Agency Pitch System

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The Advertising Agency Pitch System

keep-calm-pitchThe Levitan Advertising Agency Pitch System is included in the book, The Levitan Pitch. Buy This Book. Win More Pitches. Just in case you haven’t looked up yet, the book is available at the top of this page. A few thousand books have been read by your competitors — and some might be using my tried and true strategies in their next pitch — against you. (How is that for a sorta hard sell?)

An element of the pitch system is the Pitch Playbook that supports the book. These are essentially simple tools to help you manage the pitch process. Here is one of the Playbooks. The others can be seen right here.

Use the Playbook to get past the inefficiency of the standard pitch process and reduce your agency’s collective groan when they hear that you are about to embark on yet another new, sometimes random, pitch.

A Big Issue

Too many agencies pitch too many accounts too often. They do not have their very own advertising agency pitch system. This can be disastrous for a few reasons:

You are pitching accounts that do not fit into your business plan and model. Worse, you have little chance of winning the account.

You are using up agency brain power and money trying to win business that you should not pitch in the first place.

You are burning out your team.

You are spending thousands for the wrong reasons.

The Go Quiz is a tool to help you decide — should you pitch that new client account or not.

The Go Quiz – 11 Essential Questions

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