Recently, a prospective agency client asked us “At what point would you expect to have results, (IE: leads) from a new business campaign?” Not an unusual question, and one we’ve heard consistently over the past 10 years.
And you’d assume that, after all the new business programs we’ve run for agencies, we’d have a straightforward answer.
Not really. The answer is – it depends.
It depends on a number of variables tied to your agency’s new business approach:
- Your new business plan and the processes that support it
- Whether your messaging truly differentiates and builds credibility for the agency
- The degree of social media and content marketing deployed
- How you define and qualify your leads
- The quality of your prospect list
And that’s just for starters. Perhaps the most critical part of getting to the answer is to understand the lead conversion cycle time for your agency. Some people might say you can get X meetings/proposals in Y months – even though there is no “one size fits all” cycle time for agencies.
The real answer, for your agency, is based on the factors that impact your conversion cycle.
Cycle time to the win – breaking it down
Cycle time falls into three buckets. First, how long does it take for your new business efforts to create initial contact with prospects; second, how long it takes for that contact to covert into a first meeting; and third, how long it takes for the first meeting to move to RFP, through negotiations, to a signed contract.
Here’s an example (jot down your answers as you read, based on your agency’s recent experience attracting, nurturing, and closing new business):
1) What is the lead-time from initial outreach (email, phone, direct mail, referral, Rolodex) to initial connection with a prospect? (As this is difficult to average, given that all pathways are a different, it can be useful to do the math for each one)
- Examples: Agency A’s cycle is 4 months. Agency B’s cycle is closer to 2 months.
2) What is the conversion cycle from initial connection with a prospect to a 1st meeting? (use the average of your last 3 initial meetings)
- Examples: Agency A’s cycle is 2 months. Agency B’s cycle averages 4 months.
3) What is the close cycle from 1st meeting with a prospect to a signed contract? (use the average of your last 3 business wins)
- Examples: Agency A closes business in 3 months. Agency B’s cycle is closer to 6 months.
When you add up all the components, the shortest cycle from initial outreach to signed business is 9 months. The longest is 12 months.
AGENCY A = 9 months on average
AGENCY B = 12 months on average
And these are just two examples. We’ve seen cycles as short as 6 months, and as long as 18+.
Cycle time to the win – how to accelerate the process
The good news is that you can accelerate the cycle time with a few tweaks to your new business plan. Simple adjustments to the size of your target audience and your content marketing strategy are proven techniques. And, marketing automation is a bit of a secret weapon that can really accelerate cycle time to close.
- How are you getting from initial outreach to connection? Cold calling? Content Marketing? Thought leadership? Networking? Speaking opportunities?
Be sure to widen the top of the funnel (ToF), ensuring that you are reaching a broad audience with your message. The wider the funnel, the more prospects are seeing your content, so the better your chances of creating awareness and engagement, on an on-going basis.
- How are you converting from connection to 1st meeting? Email or direct mail follow-up? Lead magnets via content marketing? LinkedIn marketing?
With marketing automation you can monitor and track engagement with the ToF list, and provide the right content, at the right time, to those prospects moving into the middle of the funnel (MoF). These messages move away from awareness building to education and compelling lead magnets, to get to that first meeting.
- How are you nurturing through the negotiation process? Workflow of appropriate email content? Personal follow-up? Social media – LinkedIn, following and re-tweeting key players, etc.
Once you’ve had an initial meeting with a prospect, and maybe even provided a proposal, they will require even more personal and customized nurturing. Use marketing automation to provide this level of content (think case studies and personal notes) to keep them engaged. It’s critical in this stage of their journey to be in front of them regularly so that when they are ready to “buy”, your agency is top of mind.
If you’re thinking this is all an investment, you’re right. New business success requires, if nothing else, an investment in time. Even more, it requires commitment to the time and resources over the long haul – see the cycle times we calculated above. No matter what you have in place for new business – an inside NB Director, a cross functional agency team, an outside sales person, an outsourced NB partner – the ROI on new business should always take into account the cycle time that is typical for your agency.
Okay, I’ll admit there are occasional unicorns in this business – the prospect who has never heard of your agency, with a budget set aside, who is ready to work with you immediately. But unicorns are few and far between. So, instead of looking for unicorns, make a commitment and invest in a consistent, steady new business strategy. Calculate your cycle times, be realistic about the time needed to generate demand, leads, and wins, and put in place the tools that can help accelerate the process.