Lately, we’ve been asked a number of questions on the current agency-client business environment. Agencies are eager to hear what clients are currently thinking. We’ve also been asked numerous questions about filling the pipeline. So, to be as helpful as possible, we thought we’d share what we’ve been hearing in our conversations with clients, what we’re seeing in the marketplace and share a heads up on some amazing opportunities ahead.
The Recent Situation
Let’s start with a brief overview of the current business environment and what it has meant for agency new business.
Right now, there has been a prevailing sense of uncertainty since March, and businesses don’t like uncertainty. No one knows where the industry will be in 3 months, 6 months or 12 months.
When we talk with CMOs, even CMOs of firms that have largely dodged the worst of the current coronavirus situation, there is a sense that they are operating without a net. This is a situation they have never been through. Even optimistic executives are cautious. To that end, there have been fewer reviews underway, and there may continue to be fewer reviews. This has been a direct outcome of the uncertainty.
And, as you know, this shortage of new opportunities has corresponded to a continued increase in competition.
We know how challenging the impact of the Consultants has been. That will continue. Their model and relationships are different than the ad industry’s. Much of their work is focused on performance marketing and UX, and work will continue in those areas. In addition, in-housing will continue to gain ground. There is a sense of greater control there, and control feels good in times of uncertainty.
There will also be new competitors and models, as agencies have cut around 50,000 jobs. And the holding CO’s have cut many senior, very accomplished executives that have personal networks and reputations well suited to starting new agencies.
The landscape is ripe for change and difficulty. Despite all of that – there is also some good news – good news that spell opportunity. What is the good news?
The Good News
Russel Reynolds just released their recap of CMO and senior marketing executive moves covering the first half of 2020 and it included a surprise: there has been a record amount of senior marketing executive movement recently.
Some specific findings from first half 2020:
- The reduction in marketing spend during the height of the lock-down did not translate into a reduction in executive marketing leadership moves
- Marketing moves at the senior-most level increased +15% in H12020 versus ago
- 241 major moves – up from 209 a year ago
These key moves happened across many industries and included changes at blue chip firms like Walmart, Kimberly-Clark, Diageo, Best Buy, L.L. Bean, Lowe’s, Staples, Instagram and a few hundred other spots.
And That Means…
Opportunity! Our friend Norm Yustin of Russel Reynolds perhaps said it best…
“A new CMO often leads to a new agency. Consider this a BD target list of 241 prospects…”
Senior marketer executive movement can be a key trigger in the customer journey for agency new business. New players are often need of new agencies. The business situation may have changed and there may be new strategies ahead or the need for new capabilities. And, of course, CMOs often want their own agency.
The agencies that prosper during this time period will be the ones that are ready.
Since it is very difficult to know when a prospect may be looking for a new agency – and since there may be an increased number of searches ahead given the recent CMO movement – your agency needs to be ready NOW. Your agency needs to have its ducks in a row for when the opportunity presents itself. Some suggested items for your to do list:
- Position your agency. Your positioning needs to be distinctive and compelling to the buyer. It has to intrigue the prospect and communicate why your agency is a better choice than other agencies. Learn more here: How to Position Your Agency for New Business Success
- Ensure your website is prospect friendly. This is a major shortcoming of most agencies. Most agencies design their websites to satisfy their own taste and interests, and don’t recognize what a prospect is looking for. Job number one of the agency website is to present the agency in as complete and compelling a manner as possible to prospects. Learn more here: Top Principles for a Prospect Friendly Website
Another key element is to build awareness for your agency expertise and experience. Promoting the great work you have done for past and current clients is one way to drive awareness.
- Make sure you have some impressive case studies polished and ready to go. These might be live on your website, promoted via your agency newsletter or, even better, featured in business publications, trade journals and/or industry journals.
- Make sure to customize your case study for the medium at hand. Learn more here: Bringing Your Case Studies to Life and The Right Case Study Style for Every Situation.
We love to see the right agency win the business. You need to be ready when the opportunity presents itself. As always, we are here to help.
Steve Boehler & Lindsay O’Neil
Mercer Island Group