I was recently asked this question, and I think it's important to share the answer here. Aside from being not intuitive, it’s something many agency owners may not be aware of.
Agencies tend to contact The Duval Partnership when they need to bring on new clients and generate additional revenue sometime between yesterday and six months from now. Ideally, yesterday. The problem with that is it takes a certain amount of time to generate interest, start having conversations, get vetted, get various decision makers on board, and then to actually close the new business.
According to sales development leaders surveyed in the TOPO Sales Development Technology Report, it takes an average of 18 calls just to connect with a buyer.
The journey from lead gen to new business is not short
When you factor in variables such as attrition in the sales cycle and budgetary calendars, it’s not hard to see why agency sales cycles from lead generation to closed new business often last twelve to eighteen months. That’s whether the new business is outsourced or not. And that is assuming that your agency is more or less ready to go at the outset. So it should make sense that the time to go “full steam” on lead gen to initiate those sales cycles is long before you need additional revenue in hand.
The time to invest in new business is before you need it
Is your agency ready to close new business today? If a prospect put your agency under a microscope, how would it stack up?
Outsourcing new business is not a magical cure-all. Lead generation will not correct or act as a counterbalance to weaknesses in your agency’s positioning. Instead, it will bring more people to view your website and your work, and then they will make judgments about it. They will evaluate the consistency between what you are telling them and what you are showing them. And they will determine whether your agency has something compelling to offer them or not.
A successful outsourced new business campaign requires a certain baseline from which to start
Typically, we work with our clients to strengthen their position and fine-tune any potential weaknesses through an agency audit. That is often a precursor to our lead generation program. It’s important to note that when we work with an agency on an audit, we know there is a certain amount of substance there before we start.
Sometimes we see agencies that have such significant problems with their website, positioning, and case studies that we know we can’t make a compelling case on their behalf in the near term. We aren’t a good match for these agencies because they need too much work before they will be in a strong position to generate new business. As much as we may want to help someone at an agency that needs a little more TLC, we only work with agencies for whom we are confident we can generate new business interest.
If your agency is not at the requisite baseline, it is not the time to outsource new business. You would have to first work to reach that baseline before outsourced new business could be effective for your agency.
Don’t outsource new business when you are in panic mode
Did you just lose your biggest bread-and-butter client? If you are already deep in panic mode, it is not the right time to outsource new business. Your desperation will not increase your likelihood of closing new business. Do not spend money that you don’t have on new business, ignoring the facts while telling yourself that you will beat the odds and close new business within six months. It’s unlikely to happen.
What is likely to happen is that you will be anxious, stressed out, and frustrated. And probably end up even more desperate six months from now when the revenue you were counting on (against the odds) fails to materialize. Even agencies that have the other necessary ingredients for a successful lead generation program are less likely to realize a positive outcome under these circumstances, because the partnership will be unduly strained under the weight of unrealistic expectations at the outset.
If your agency is in dire straits, you may be better off scaling back on expenses and trying to pick up additional business from current and former clients for more immediate relief.
When SHOULD you outsource new business?
Most agency owners don’t give a lot of thought to outsourcing new business until they find themselves in exceptional circumstances...which is often in a time of panic. That’s fine, as long as it’s a motivational amount of panic.
A proper balance of vision and pain
We like to say that our ideal agency partner has a nice balance of vision and pain. If there is not a certain degree of pain, it won’t be a priority for them. We want our agency partners to be fully invested and to understand they have to do more to get the results they need. On the other hand, their pain can’t be so great that they need to see results in an unrealistic time frame.
Our ideal agency partner must also have the vision required to support a successful agency business. We can help successful agencies grow and overcome challenges, but we can’t generate business for an unsuccessful agency or fix broken agency business models. There has to be a solid foundation to build on.
In short, the best time to outsource agency new business is when your agency is doing relatively well, but you want to be doing better.
Get answers to more questions about outsourcing new business:
- How an Agency Brand Audit Can Boost Your New Business
- How to Tell if Outsourced Biz Dev Can Help Your Agency
- Agency Case Studies: Upgrade Your Case Studies for New Business
- What Are Agencies Doing to Win New Business?