While traditionally most agencies have gone after AOR type relationships, the key to new winning new business now is the antithesis of that approach! Why do I say this?
I am certain that you have all noticed the continuing trend of clients moving away from AOR type relationships, to more of a project based approach. This varies from the client who has no AOR and just assigns projects as needed to selected agencies, to an approach of having a list of rostered agencies that pitch for each and every assignment as they come up.
The reasons for focusing on the AOR type relationship are primarily continuity of work and profitability. It has always been very difficult to manage agency resources and make money on project assignments. Well, if you want to increase your new business success today, you are going to have to adapt to the new reality.
At a recent Mirren new business conference held in New York, participants in a client panel question and answer session made the following remarks:
- Most were not of the mindset to put up their whole account for review.
- It required effort that would distract them from the day to day business. They acknowledged the inordinate amount of time it took not only to conduct the review but also to onboard the agency during the first 6 months.
- It would put them and their department on the radar screen internally. A negative, given most were trying to keep a low profile.
- They would most likely require the procurement departments participation which complicated matters.
- The perceived risk did not justify the likely outcome at this tenuous time.
- Almost all were open to approaches from agencies with new ideas that could help them succeed.
- The participants said they were quite often able to find a smaller budget to fund a single initiative, if they felt it was a good idea.
- They felt more comfortable with the project approach, as it could be assigned outside of their current agency relationship.
So, if you want to increase your new business success in the immediate term take a targeted project approach. Get your ideas in front of them, get your foot in the door, and demonstrate the value you bring to the relationship. Success breeds success and will most often lead to incremental assignments.
You may not make money off the first project, but if you take a 12 month client profitability approach and manage your resources efficiently, you can achieve the desired outcome.