Talk to us about Building the relationship – some call it the ‘hunt’ or ‘the seduction’.

I was a Creative Director at JWT Australia and we were pitching all the time during my 5 years there.  I enjoyed the challenge of the pitch but they were all run so badly.  This inspired me to set up Trinity P3.

Creative Business Principles

1. I believe in the golden rule – the man with the gold makes the rules.  If i want to influence the process I go with the gold.
2. The agencies pay enough in this process – biz dev is a high cost of business.  Marketers should only pay for them if they have abnormal requirements of the agency e.g. fully worked up TV commercials, or want to see 100 concepts.  And if they want to own IP.

I’ve seen clients make a token payment of $5k to the agency which is an insult as agency costs on a big pitch  can be $100k plus.  Think of behavioral economics – the client gets often more demanding after a payment like this rather than less so the money doesn’t help the resultant business relationship.

What are the changes you’ve observed in the business

I founded Trinity P3 in January 2000 and the biggest change in marketing is complexity – increased opportunities through technology, mobile channels, access to data, internet and of course consumer power through social media.  Marketers are struggling with complexity as there are multiple stakeholders internally and multiple suppliers externally.

On the pitching side you get these complex pitches – in media they could be looking at a media planning/buying agency, a data analytics agency and a strategy agency.  There can be multiple combinations of suppliers in the one process.  The brand is looking for the best combination at the end of the day.

How do you differentiate different agencies?

I talk about content creation and channel.

I’ve run pitches with 12 agencies but within that are 3 groups : traditional creative plus digital, digital specialists and creative specialists.  Ultimately a brand wants someone to handle all their content needs.

Collaboration – we’ve moved away from beauty parades to doing strategy workshops – the client wanted to choose media, creative and digital.  We ran the 3 in parallel simultaneously.  So all three categories participated in a full day strategy workshop with the client.  3 agencies in each of 3 workshops.

What were the benefits of workshops?

We selected the 12 agencies by reviewing their credentials first – what were capabilities of each agency business.  Next we looked at chemistry – understand the client/agency meeting and how that went.  The client then selected 3 from each skill group.

We put them together in grouping – which we worked out by asking them who they’d worked with [we didn't tell them who else was in the pitch] there were already alignments.  A few had already done work together.  And we considered the culture of each agency and thought who would fit well together and with the client.

We bought a creative from one group, digital from another.  Testing collaboration doesn’t mean you buy the package – the workshops were about working with the client and also with each other.  e.g. in one grouping the Creative agency completely dominated the digital agency.  They clearly didn’t understand what collaboration meant and the digital agency didn’t have the confidence or wherewithal to maintain their presence in that process – they folded under pressure.

How does agency collaboration work in practice?

Marketers find hit hard to articulate and manage the collaborative process: The client should set the rules.  It’s not within many brand managers’ skill set.  They don’t necessarily have the people skill set to do it – they often don’t think they have permission to manage their agencies.

We have marketers contacting us to say they have problems – they don’t like the confrontation of honest feedback with their agency.  It often means telling the agency things that are subjective or emotional and many people feel out of their depth because it’s not rational and can’t be justified.

How do you select the winning team?

We use score cards – we used to use both emotional and rational ones.  I dropped the emotional ones because I found they were mirrored by the rational one.

[emotional questions like: you've had a bad week but most of the issues with the agency were resolved. On Friday night select which one you'd like to have a drink with.

You've been given a career opportunity with a competitor: List the agency CEOs who you'd feel confident asking for career advice.]

The rational ones are driven by their emotions – so there was not point asking the emotional questions….When  you use scorecards – do you weight answers.  We don’t use them to make the selection – we use it to help brands structure their thinking.

We look at what attributes scored well. The danger with weightings is you are dealing with averages and weightings just upscore one average.  You can fudge the numbers.

So we discuss with the brand, “here’s the scores and let’s look at those who scored highly for the things you value”.

What is your biggest biz dev learning?

The biggest learning I made in 12 years of pitching was so many times clients would say your creative wasn’t up to scratch…. so everyone blamed me as I was the Creative Director.  I found that creativity is an easy way of saying actually we didn’t like the chemistry or the MD was sleazy.

My personal view about how to justify marking up services to sell to clients is this.
If you have invested time and money researching the service, learning how to use it and how best to integrate it into marketing campaigns then it is legitimate to charge your clients for selecting and using that service. BUT transparency is key – the client must know your mark up and agree to this before starting the service.

[Read last week's #FutureAgency post about the services you could sell to clients]

Many agencies also sub-contract services to and from freelancers and other smaller agencies. This is a great way of tapping into key skills that you don’t have in-house but which clients need. We have a WordPress specialist, an Adwords specialist, a Database researcher, graphic designers and HTML coders whom we use regularly.

These all pass the 2 question test above and so are appropriate ways to get additional revenues.

Inappropriate revenue streams?

There are other ways of making money. These are “unearned” revenues do not come from your intellect, your expertise, your industry experience or are delivered with no skill related to marketing.

Many agencies make profit from marking up expenses – public relations firms in the UK used to be authorised by their industry body (PRCA) to mark up expenses 23.5%. FREAK. Twenty three point five percent extra revenues for doing precisely nothing. It may look like easy money to the agency but think about it from the client’s point of view. Did they get value from that work?

This soft of rip-off culture has no place in the agency of the future. It’s not transparent, its borderline unethical and adds no value to the client.

In the past, I persuaded colleagues to review one of our agencies by demonstrating to our Finance Director that their expenses charges had increased for 10 out of the past 12 months. How could they justify that greed? Were their campaigns more successful?

Here at Creative Agency Secrets we do mark up sub-contracted services – that’s because it costs us time to oversee, manage and deliver the work. But expenses like straight up I-spend-money-to-go-to-your-office type costs, we charge at cost. Why should I profit from something that adds little to the client’s bottom line? We also choose not to expense telecommunications costs (Skype, mobile phones, conferencing, webinars).

Affiliate Revenues

A legitimate source of additional agency revenues is affiliate or partnership relationships. These can be for services or products that you introduce to your client and for which the service-provider pays you a portion of their revenues. These are different and separate from expenses. The client is purchasing from the service provider, not from you. They can choose to take or reject your recommendation of that service set and so are making a commercial purchase decision. For transparency’s sake, we always tell clients when we are earning money from referrals or affiliate relationships.

If the services you choose are ones that you are using for your own business (refer to Part 1 choose your agency) and so you know their offering intimately, these are the best ones to choose. Keep the list short. A large list will only dilute the effect because many affiliate programs have tiered sales volumes and you can earn more revenues if more business passes through your channel.

Note, I’m not advocating you become solely an affiliate marketer. That is not the agency business model – what creativity is there in just reselling others’ services? The top strategic agencies who outsource production retain the thought leadership, marketing strategy and planning roles and thus add value to their clients.

Underlying principle: transparency; multiple revenue streams through appropriate partnerships and the whole underpinned by retained, preferably 12 month long contracted relationships.

 

Next week we sh0w you How to become the right agency for target brands.

Being exposed to a single large client is well-known as a fundamental mistake for agencies. I had a consulting client who spent a year executing a new corporate identity for a UK Building Society Bank. Within 4 weeks of it’s launch and roll-out nationwide, the outfit had been bought by Santander Bank and was renamed. There was no repeat business, they’d spent over 80% of their energies on one client for whom there was no prospect of any more work = end of agency. and lost jobs.

So what should a modern agency to do?

1. The best answer is to have a range of clients, none of whom are over 20% of your monthly billing. Try to create contracts that don’t all end in the same month so you have overlap and won’t be very short of work all at one period if several clients don’t renew or projects don’t lead to more work. And also try to get longer contracts – aim for a year if you can; 6 months minimum. In this way your underlying revenues don’t change much month to month and you can take some uncertainty risk out of the business.
2. The second thing is look to get new revenue streams. There are two schools of thought about whether agencies should make money selling things that are unrelated to their core expertise. Some think it’s a good way to diversify and others think it dilutes the core skills of a creative agency.

A bad example of new revenue streams

For a while in the UK TV shows were paid for by “advertiser funded programming” i.e. brands paying TV companies to make the show. This wasn’t sponsorship or advertising, it was for product placements and other benefits. Both TV production companies and advertising agencies tried to get into this game. But few succeeded. The reason is that the skills to negotiate broadcast programme contracts and assess brand ROI are rarely found in the same people with the same experience. Many agencies spent a lot of time paying staff to chase these deals which didn’t come off and so ended up costing the agency a lot for no return on their investment.

A good example of new revenue streams

There are good ways to earn revenues from ancillary associated products and services.

How to find appropriate services to resell. The best way to appraise them is to ask two questions:

“ Are these products or services very close to the agency core skill set?”

“Are we using these services to deliver campaigns for our clients?”

And thus many agencies resell software licenses for cloud services which they use themselves

• Project/campaign management (Basecamp)
• CRM (Salesforce, Highrise)
• Email sending (Aweber, Constant Contact, Feedblitz)
• Web Content Management Systems (Hubspot, Contegro)
• Website hosting / domain management (eUKHost, Network Solutions)

Read the rest of the #FutureAgency series by following the category in our sidebar

Next time we ask, Is it appropriate to mark up services sold on to clients?

For brands who are growing  and becoming profitable there comes a time when you choose to professionalise your marketing.  Many businesses decide at this point that they have two choices: to hire a staffer or to buy in expertise from an agency.

Why you need better marketing

The needs are clear – you want more traction with your marketing, you suspect that there are better ways of doing promotion and marketing to get inbound leads and you can afford a budget just for marketing.  These are good signs.

You have identified clearly that your brand has a need and the possible shortcomings of your current set-up.

Hire versus buy: the dilemma

There are advantages and disadvantages – the internal member of staff will need to have well-rounded skills in a range of marketing disciplines (web, advertising, PR, copywriting, print design) and therefore a senior hire with this range of skills is more expensive than a junior.

Using an agency also requires decisions about their skills and area of expertise compared with the type of marketing and communications activity your brand has done in the past or plans to do in the future.

Costs are usually the determining factor

It may be less costly to hire external advisers compared to the cost of a senior member of staff – compare the full cost of hiring and paying (including office costs) a new senior marketer with the price an agency would charge you.

Have a couple of ‘chemistry’ or getting-to-know-you meetings with local marketing agencies and ask their advice.  Also ask to speak to a couple of their recent clients to see if they also made the same transition.

A third option worth reviewing is using a freelancer.  You don’t have the full hire costs of a full time person but can often get very experienced people at lower fee rates.  Check out the freelance hire websites like eLance.com and Freelance.com, Freelancer.com and guru.com.  I’ve successfully hired people for my agency and for clients using eLance.

Creative Agency Secrets has two current clients who use us for mentoring work.  They hired a junior marketer and we speak weekly to review their work, priorities and give guidance.  Could this work for you?  Give us a call – we always offer a free 20 minute first call.

In the meanwhile here are a few other articles that may help you figure out what to do

• Advertising – do it yourself or hire
• Hire a PR firm or do it yourself?
• Do it yourself internet marketing, or hire
• Hubspot offers inbound marketing tutorials for people using its website / content marketing system.
• Read Creative Agency Secrets’ assessment of Hubspot and how to do it yourself
• SEO do it yourself or hire a professional
• Small Business marketing – DIY or hire a pro?
• Web design – do it yourself or hire someone
• DIY or hire a market research company?

Image by imjustcreative via Flickr

Sometimes it’s nice to be on the receiving end of some in-bound agency marketing.  There’s a nice branding agency we have been following based in Birmingham, UK.  They sent us a little slide deck.

It had some background slides about the company and some case studies of client work.  All very nicely presented.

BUT

There was no apparent purpose to the communication.  The deck arrived with a nice covering letter but no call to action, no reason for the email except to say they had some ‘exciting news’.

So we launched in to a critique and sent them this email

That’s a very interesting slide show you’ve presented. Thanks for sharing it.

However, you really do sell yourself short in an email shot like this – what would a prospective client like myself think after reading it…… “Nice slideshow. What was the ‘exciting news’ anyway? What now? Back to my work.”

Using some direct response copywriting in the covering letter/email can you provoke me to deliver a response? For example – get an answer to questions like ‘what did Rebecca think?’ and ‘could they do this for my brand?’ Both questions that will help to narrow down your list of ‘suspects’ and take them one step closer to becoming prospects and then clients.

What about building on the campaign like this?

• Having a special website landing page just for people who got the email?
• Use the landing page to measure click throughs and get a poll / survey / comments / discussion going?
• Sharing the slides on slideshare / docstock so others can embed them and let them go viral
• Putting them up on your website for others to ‘like’ on Facebook / Twitter
• Asking for a meeting in the email text so you can show your credentials in more detail
• Asking questions about my brand so I can see if I ‘suffer’ from the same problems you solved for your clients

Anything but just sharing your slide deck…

So that’s just my two pennyworth suggestions for you – free of charge.
You can take them and put them into practice yourself.

This is an unsolicited approach offering you some free advice on how to improve your marketing. I just happen to be on your mailing list and so hope I’m trusted.

And they replied

Thanks so much for your thoughts.

This soft launch does indeed have a plan underpinning it, with more activities to come.

That said your passionate response is appreciated. We will keep you in mind for future activities!

What would you do in response to an unsolicited email?

Image via Wikipedia

Imagine you have launched your business and the brand is up and running.  You are receiving enquiries but not enough are converting to paying customers.

Even though you may be the genius behind the business idea, you have no idea how to successfully pitch your business to potential clients and convert them.

Why not hire a professional to pitch for you?

Successful Marketing agencies know how to pitch a business/ brand. Full stop. That’s what makes them successful.

So why not pitch your business/ brand to an agency in a relaxed environment where your pitch won’t matter and let them transfer it into the professional and suave format needed to win you new clients?

It’s as easy as choosing an appropriate agency and filling them in on your business/ brand, the goals of the pitch and background information on who they will be pitching to.  If they are good at what they do, they will do their own research and put a creative agency swing on things.

Choosing an agency

When choosing an agency to pitch for your business you will be faced with the choice of an agency that has previous experience in your industry sector or an agency that doesn’t. Although this seems like an obvious decision, don’t write the latter off straight away, everybody needs to start somewhere and often an agency new to your industry sector will have fresh ideas and be able to think outside the box, which is often a key trait of a successful pitch.

Shortlist and meet with a couple of agencies, keeping in mind that you will have to work with these people and rely on them to secure your business. Your aim from these meetings should be to work out if the agency is as motivated about your business as you are.

Filling them in

Provide the agency with all the information necessary to make a winning pitch including;

• Names of the clients they will be pitching to
• Background relationship between your business and the potential client
• Outcomes you hope to achieve with the pitch – remember credentials meetings and chemistry meetings should still have stated outcomes planned in advance.

Related articles

• How To Fix A Broken Pitch Process (adpulp.com)
• Winning pitches is fun! (creativeagencysecrets.com)
• The Art of Pitching (creativeagencysecrets.com)
• Cynicism, duplicity and institutional incompetence (stephengreensted.wordpress.com)
• The Unspoken Evil Of The RFP (socialmediaexplorer.com)
• RFP Hell (kula partners)

How can you come across as the kind of person they want in their life?

What should I always do when pitching?

Of course there are obvious things which should be commonplace every time you make a pitch:

• Dress Snappy – better to be over-dressed than underdressed; research your prospect company’s dress code to make sure
• Arrive early to the meeting and familiarise yourself with the environment – this will allow you to be more relaxed during the pitch.  If possible scout it out a week in advance.  Check power socket locations and AV equipment.
• Always be grateful for the opportunity – if the pitch doesn’t go the way you wanted it to, thank them for the chance.  Never cut ties with anyone in business.  You never know, they may recommend you to someone else or ask you back for another chance

Recently I have been a part of two creative agency pitches to two very different businesses. The first was a gas fire manufacturer and the second, a real estate agent.  Although both pitches went well, what quickly became apparent to me was that having the confidence and public speaking skills to pitch your business is only half of what is required for a successful pitch.

The first pitch

I entered the first pitch knowing very little about the gas fire manufacturer and the meeting quickly became a one-way flow of information on who the company was and what they did.  This was possibly time wasted.  They wanted to tell us about themselves and if I had prepared properly for the meeting I would have known all this and the time could have been spent on discussions on what we could do for them as a creative agency.

The second pitch

Taking this into account, I prepared for the second pitch and did deep research on the prospective client.  This not only impressed the client but it saved us time where we could get down to the nitty-gritty on how we could help his business.  This pitch went well and there was agreement on a further meeting to discuss our proposal.

What should you do

Below is a checklist on what sort of research should be done for any public relations project, which translates very well to pre-pitch research. Click here to see the full checklist and article.  Work through this checklist to ensure you have done all you can to research a prospective client before entering that all important first pitch

• See what’s being said on social media - This can be a great real-time window into what others know and think about your client and a great way to make sure that your pitch will go over well.
• Spend time with your client – Set their expectations that you want more than a one-hour meeting. You want a few hours to mine them for any and all information.
• Spend time without your client – Ask them to put you in touch with people from other areas of their company: sales, customer relations and even those on the floor (front desk personnel, those at the cash register, tour guides, etc.).
• Get on site! – If your client is a hotel, be a guest. Spend the night, try the food, and ask for suggestions of surrounding things to do.

Rob Lane

Rob is Marketing Assistant at Creative Agency Secrets.

Related articles

• Cynicism, duplicity and institutional incompetence (stephengreensted.wordpress.com)
• Knowing Your Client Inside and Out: A Checklist For Client Research (dontdrinkthekoolaidblog.com)
• How To Lose A Pitch When You Thought You Were Winning (stephengreensted.wordpress.com)

Helpfully he gives four steps to follow which will help you to make the best of poor communication situations:

1. Notice. Anytime you feel a negative emotion about something said or written to you, it’s a warning sign that you might get distracted by the package. Anger, sadness, frustration, disgust, and disbelief are all good prompts to go to step 2.

2. Pause. Take a deep breath. Then recognize you’re vulnerable to reacting emotionally to how something was communicated. And remind yourself that communication is hard and often done poorly. Cut yourself, and everyone else, some slack. Don’t assume malicious intent. Don’t take it personally. Resist the urge to be offended.

3. Interpret. Now reread what was written, or think about what was said, and unscramble it. Think about what the person was trying to convey. Search for value. Strive for understanding.

4. Respond. A good rule of thumb is to use a different medium than elicited your emotional response. If a text upset you, don’t text back. If an email set you off, pick up the phone. And when you do reply, ignore the package and focus on the message.

I  add a sub-step between 3 and 4.

Time.

Leave some time (overnight is good) for you to reflect on the anger the message created in you and whether your reply will communicate the right message in the manner you intend.

When you read the article, reflect on the male : female responses to the same message.  They matter a lot in business and if you’re a woman working in a male environment, you may find you get a better outcome if you use male messaging mores.

The same rules apply when pitching for new business – when you receive a message back from your prospect, can you correctly interpret what they mean?

Related articles

• Don’t Let the Package Distract You from the Message (blogs.hbr.org)

WRONG.

Day after day working for my business and my clients’ I find examples of organisations that make it really difficult for people to get in touch.

Here’s the latest crop of examples.

1. Author gets article into Harvard Business Reivew (like WOW) and states at the bottom that he’s a Senior Adviser at Oaktree Capital.  Can I find him mentioned on their website?  Does their site have a news page with a link on it?  Has it been updated since the 2009 copyright statement in the footer?
2. I write to Claremont GI, an interior fit-out company, enquiring about their products for a client.  They only offer one enquiries@ email address and it returns an  undeliverable  bounce message from the server.  How much new business are they losing?
3. Working for a self-published author, we try to contact the buyers for large book retailers.  Their websites give no contact information for the corporation – just online store customer service.  Whitcoulls,PaperPlus – this is YOU.
4. A national bookstore chain, Borders, that doesn’t list a single email address on their contacts page.
5. Groups of companies that list the PR company as the main contact point.  Dot Digital Group lists their PR agency above the corporate HQ on their website – and that’s for a supposedly digital organisation.  Fails the basic “do what you preach” test.

I would love the result of this blog post to be a comment from each of the organizations named telling me why they choose their contacts page design as they do and advising how we should get in touch with their people.

Dot Digital Group contacts FAIL

Recently I was asked how would I write an introductory letter to send prior to cold calling?

My answer “I wouldn’t”.

Reasons to write

There are a couple of key reasons people send an introductory letter:

• They believe it will be read and as a result the prospect will be more open and receptive to their call.
• It makes the call feel less cold so makes making the call easier.

The reality:

The vast majority of your mailings will go straight in the bin, a few will get skimmed first and then binned.  A few will find their way into a pile and become buried, and if you’re lucky and the gods are on your side a few may actually get read.

When you call

So how does this translate for someone receiving a call from you?

If they just skimmed the material or binned it without reading it they probably have no memory of ever receiving it.

Straight away this triggers two doubts:

1. Did you even send them anything or is this just a gimmicky opening you use to get them chatting?
2. Secondly, if you did send them something it must have been of no interest to them or they would have remembered it.

This is not the best footing to start a call.

In short, pre-mailing prospects is time wasting, ineffective and often leads to doubt and mistrust in the minds of those you call.

Invest your time and energy into making more calls and asking more people to take the next step with you.

Success belongs to the askers, so stop mailing and keep asking: the results will speak for themselves.

Paul Foley, Noodle Coaching