WHY ADVERTISING AGENCIES MUST INVEST IN WINNING NEW BUSINESS PITCHES IN 2018

WHY ADVERTISING AGENCIES MUST INVEST IN WINNING NEW BUSINESS PITCHES IN 2018

If you truly want to win an greater share of NEW BUSINESS in 2018 while winning minds, hearts and iconic brands, here’s how. I am going to highlight some of the key factors you must be aware of to outperform the competition with your presentations, pitches and chemistry so you CAN be extraordinary.

Being good isn’t good enough anymore – there is too much competition and shifting landscapes not to be invested at 100%.

It’s important, if you are going to have a extraordinary 2018, to start prioritizing, editing and updating your website, pitch decks, capabilities right now. This will enable you to make highly targeted new business lists, set your goals and objectives and most importantly, start to think about changing and improving past routines and practices.

The advertising business has always been about creativity and return on investment for clients and brands. But, holding companies like: WPP, Omnicom, IPG, Publicis, etc. have added new pressures: share price and shareholder return. (This means not just great ideas and stunning creative anymore!)

Unlike the Holding Companies of today, I have observed over my career, that when founders of an agency work with their own agency’s money (usually mostly theirs) they are far more likely to invest, to take chances on a small brand, charity or account, for the break-through creative opportunity that might arise!

However, under a holding company, a ‘good year’ is not the agency’s good year anymore, it’s the shareholders’ good year. (Shareholders are the priority, not usually the staff or team.)

Additionally, they are way more likely to share the year-end spoils with the staff, employees of the agency and, in the process, motivate all of them. I certainly learned that lesson while working for MojoMDA.

This proved to be the case when they were awarded International Agency of the Year for two consecutive years in a row by Advertising Age (1988-9). Having a winning mindset coupled with high productivity, boldness and necessity was the key for ongoing and long-term success.

The United States is, by far, the single biggest advertising market in the world. In 2016, more than $190 billion U.S. dollars were spent on advertising in there.

The figure is more than double the amount spent in advertising in China, the second largest ad market in the world. Forecasts showed healthy projections for the ad market in the U.S. for 2017, and media advertising spending is expected to exceed the $207 billion U.S. dollars mark this year and even more in 2018!

Despite ‘new’ competition coming from all directions – the new business and growth battle is only going to continue to escalate in 2018.

With over 100,000+ people employed in the US market alone, this Industry is highly competitive BUT it also needs to radically change and respond to the latest technology and data skills to keep growing.

For most Advertising Agencies, Television has been the biggest advertising medium in the US for the last four decades, but it is projected to lose its market lead in 2017 to digital.

Importantly, the requisite skills have dramatically changed over the past decade. The days of the traditional ‘Mad Man’ are long gone having evaporated with speed!

TV advertising revenue was also forecast to grow from $73 billion U.S. dollars in 2016 to around $75 billion U.S. dollars in 2017 and $82 billion in 2020. BUT, growth and the importance in mobile, data and social have well and truly impacted on all marketing and advertising decisions in 2018 and beyond.

Additionally, parallel to television and digital advertising, more traditional mediums for advertising, such as radio, magazine, outdoor and newspaper, have seen their market share decrease in the last few years, as advertisers turn to other types of media.

Picture: Media advertising spending in the United States from 2015 to 2021 (in billion U.S. dollars)

Here are some thoughts and considerations anyone in Advertising Agency Management or Growth should ponder BEFORE 2018 kicks off:

1. THE COMPETITION WILL BE UNPRECEDENTED –

More Nimble, more digital-savvy model consulting and technology companies like: Deloitte, Bain & Company, Accenture, Boston Consulting Group, KPMG, IBM, Booz Allen Hamilton, and PwC, are competing with and even acquiring ad agencies.

McKinsey is slowly building an agency arm. Tech companies like Salesforce.com, Adobe, Oracle and Epsilon, are encroaching on holding companies’ turf, in a bid to shake up the industry.

Ideation and acting as creative vendors is the agency model legacy and it is just not enough. If you want to have an impact you need to own the high-level business strategy.

In fact, to highlight the impact of the consultants alone, it is estimated that in 2016 alone, Management consulting was a Billion Industry and expanding at the cost of monolithic Holding Companies and Ad Agencies. They even employ more than 600,000 people in the US alone! That’s way more than ‘traditional’ Advertising Agencies and Holding Companies!

Recent research studies highlight, Top consulting firms receive the highest number of ‘very frequently recommended’ ratings from the polls that Forbes and Statista conducted of more than 8,000 senior consultants and more than 1,000 senior clients.

The polls measured each firm’s work across 32 sectors, ranging from finance to oil and gas, and with work pertaining to legal issues and mergers and acquisitions.

These were the highest ranking groups recently the ‘Big Three’ major management consulting firms , McKinsey, BCG, and Bain all made the highlight list.

AND, the consulting branches of three of the ‘Big Four’ major accounting firms: Deloitte, PwC, and KPMG also made the list of most recommended.

2. BE CONSISTENT WITH GROWTH & BUSINESS DEVELOPMENT 

In 2018, the best results and success will come from groups that consistently focus on all business development activity and fully integrate it into their operation or agency. By that I mean, carefully crafting inbound and outbound lists for the new business pipeline, allocating staff and resources for growth, setting clear deadlines and actions required, without compromising on existing clients or current performance.

3. Differentiate your agency positioning from the masses

The most successful agencies today know why they are different, this knowledge leads their creative and production teams to better understand who their difference will appeal to and who it won’t, shaping your prospect list into higher probability opportunities. So, with over 50,000 Agencies all offering ‘great creative skills’ – it is vital to breakout and position yourself for success in 2018.

4. BE BOLD, COURAGEOUS AND PERSISTENCE

Knowing what makes you different and what that difference matters will make it easier to know what to say or what content to share, and how to pitch more wins.

5. GLOBAL CONSULTANTS ARE BUYING UP AND POACHING CLIENTS

Companies like: Accenture, Deloitte, IBM, KPMG, McKinsey and PricewaterhouseCoopers rank among the most aggressive players, and as newish players, they are now aggressively stalking and gaining rapid attention and results from clients, making the ‘competition’ even stiffer for today’s Advertising and Digital Agencies.

In fact, I understand that Deloitte alone has expanded its digital operations and now employs 15,000 plus staffers worldwide and are still growing! Deloitte even integrates branding and content expertise with core strategic offerings such as financial and technology services, data analytics and customer segmentation. This makes the company a more valuable partner to current and prospective clients.

Note: You’ve been warned!

So, if your agency doesn’t understand the client technology available today, digital strategy or even advertising strategy in a mobile/digital world – you must start focusing on this immediately. Otherwise, you will lose business in 2018 to these ‘consultants’ and new tech breed.

6. A DIGITAL TRANSFORMATION IS UPON US

Along with a desire by consultancies to tap into clients’ escalating digital marketing budgets, the acquisition trend reflects the ongoing transformation of the business landscape as a whole, and provides a blueprint for how consultancies and agencies will do business moving forward.

As consultants like Deloitte, Accenture, etc. ’ bread and butter’ has traditionally been large IT and business-transformation projects. But to compete today, I believe all agencies must increasingly, strive and drive projects that have ‘customer experience’ at their center.

In other words, ‘How do I improve the experience my customers get whenever and however they interact with my brand? How do I ‘onboard’ new customers in a way that’s as easy as using AirBNB or Uber?’

Additionally, in 2018 all Agencies MUST, think more and deliver more value with data too.

Over the last decade especially, besides the consultants, companies like: Facebook, Google, Amazon, Salesforce, etc. have made huge inroads on ‘traditional’ agency revenues by providing more data and a clear direction for data to work harder and generate new revenue streams.

I have personally seen and felt over the past two decades, the best marketers I have worked with have all, set goals to intersect brands seeking to produce campaigns, events and points of contact (digital, in-store and otherwise) that foster one-to-one relationships with customers, sell products quickly and efficiently, and keep buyers coming back for more.

The best thing Agencies can do today, rather than anytime in the past is to teach clients that Brands are now created by a series of connected—or often disconnected—experiences consumers have with a company or brand across multiple channels.

7. ADVERTISING EXPENDITURE IN 2018 WILL CONTINUE TO GROW

United States’ advertising expenditure will amount to approximately $185 billion U.S. dollars in 2017. According to a different source, direct mail was the largest ad medium in the U.S. in 2016, followed by TV and digital.

The advertising investments for these media amounted to $36.9 billion, $20.8 billion and $17.3 billion U.S. dollars respectively. Among all states: California generated the largest ad revenue, followed by Texas and New York.

Additionally, the major holding companies in the Advertising & Communications space e.g. Omnicom, WPP, Interpublic and Publicis, marketplace fragmentation converged as they acquired hundreds of marketing service firms and, together with a relatively new arrival on the global scene Japan’s Dentsu, just five firms now account for approximately 70% + of worldwide revenues.

But, if the Advertising Agency in 2018 focus on ‘upgrading’ their existing marketing operations and practices, they will really become even more successful if they focus and invest more in introducing new services and experiences powered by technology to transform their marketing operations and demonstrate to their clients and brands, not only can they utilize skills across the entire customer journey BUT, they are pushing ‘best practices’ with mobile, data, cloud marketing, AI and social media marketing.

The days of advertising agencies pushing work at lower paid staff and support team are dead and buried. With many looking to improve profitability and increase their revenue streams and EBITDA, they know their ‘old business model’ is flawed and there is no better time to upgrade and improve the system than in 2018.

As an article by Avi Dan in Forbes recently stated, Is Havas the canary in the coal mine? Accenture, with four times the market cap of even the biggest holding company, could buy Publicis or IPG; and, IBM with six times the market cap of WPP, and with whom it already has a working relationship, could easily absorb it if it wanted.

Are the hunters to become hunted?’

I don’t envisage that changing in 2018 or beyond either.

So, focus your investment where the people and bodies are! Using a target 1 to 1 approach and truly impacting your best prospects will be key for both Agencies and clients in 2018. Fish where the Fish are!

Conclusion – If you want greater success in Sales growth in 2018, or feel the competition is getting too tech, too digital, understands mobile, data and social media better – please reach out and contact me to arrange an obligation free call or meeting so I can help you.

I can help you to navigate the obstacles and assess all the opportunities of driving revenue and margin within your organization. Nimble, data-driven, corporate growth isn’t a box to check, but rather an expedition and I have run and excelled at tech, digital, 1:1, social media marketing and branding agencies globally for over 25 years.

My expertise can enhance your Agency and help you to master new technologies, tools and insights, as well as drive the mandatory changes in your culture, processes and people.

END

About Geoff De Weaver:

Since 1985, Geoff has helped pioneer the use of inbound/outbound marketing, content marketing strategies, leadership, digital, PR, innovation and social media marketing specifically for agency new business.

Geoff is one of the Advertising & Digital industry’s leading agency New Business Thought Leaders. His extensive cross-cultural expertise spans five continents, multiple languages and hundreds of companies. 

Geoff can also access hard to reach brands and clients, fully examine and target your exact needs and requirements in all channels. I can even pitch on your behalf and happily be the extension to your company’s new business team.

Proven, in-depth expertise in Internet Marketing, leadership development, organization design, performance management, training, ideation process and communications. Areas of focus are leadership, innovation, agency profit and loss, global business development and executive coaching. 

Give me a call and let me show you a better way, +61 411 224 961 or send me an email: geoff@geoffdeweaver.com

Specialties:

Global Brand Management & Operations, Digital Marketing, Marketing, Advertising, Sales, Training, New Business, Consulting, Management, Strategic Planning, Leadership Coaching, High Performance, Team Building, Operations, and Ad Agency Growth.

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