I recently wrote about the right time to outsource agency new business. Now I want to address a related topic: expectations for outsourced agency new business results. When you engage an agency new business specialist, of course, what you *want* to see is a flood of new qualified opportunities. But, as has been stated by myself and others in this line of work, agency new business is not magic. It's science. Through understanding the process, you can better understand realistic outcomes for your agency.
In basic terms, a new business person’s job is to plant seeds and nurture them through the seasons, coaxing them to develop into revenue based on their growing cycle. It requires some patience to let these opportunities blossom in their own time.
New business specialists can help you address weaknesses and inconsistencies in your positioning and determine the best way to reach new audiences. However, your agency must be fundamentally sellable; if it’s not, new business efforts won’t save it because lack of leads is not the problem. Keep in mind that if you don’t have compelling recent work, or if your case studies are flawed, for example, you may face more barriers to generating interest, potentially slowing the volume of qualified leads and the time to close new business.
We use 12-18 months as a generic ballpark for closed agency new business. That is an industry benchmark for the average time it takes for a prospect to progress from initial contact to close. Many agencies are able to close much faster than that. One of our newer clients is in negotiations to close their second piece of new business within four months. But before you expect that your agency *should* be seeing closed new business in six months instead of 12-18, be sure that is supported by data from your past performance. Outsourcing new business is not a quick fix for a long sales cycle.
If you aren’t actively tracking your leads from the time they appear to the time they close, then you may not know what your agency’s average sales cycle is. Many agencies (73%, according to Hubspot) do not track total leads generated, and may not have the data to calculate these KPIs. So you can say you want to close 15 new leads in six months. But if your expectations are inconsistent with the length of your sales cycle, they may be unmet.
At the Duval Partnership, we use very targeted lists of leads, each with its own customized messaging and “plan of attack.” It’s inaccurate to call it simply a numbers game. Our target lists are shorter, and our communication goes deeper. But the net effect is more leads in the top of your funnel which should correspond to more closed business at the bottom. We work with you to nurture leads after the initial meeting, assisting until the business is closed. Note that we don’t necessarily change the speed of your sales cycle; rather, we change the volume of input/output.
Outsourcing agency new business is highly effective because agencies already have untapped opportunities waiting for them. Two of the most common mistakes agency owners make with new business is not devoting enough time to it and not being consistent enough about following up with it. (In fact, insufficient follow-through and persistence with leads is a sales problem across industries; a recent TOPO Sales Development Report found it takes an average of 18 calls just to connect with a buyer). The irony is, agency owners are largely aware of it, but it doesn’t change the fact they don’t have the time to invest themselves in it. Outsourcing lead generation is a simple solution to this common challenge.
Outsourced agency new business works just as well when an in-house agency business development team is already pursuing their own list of targets. Outsourcing provides an additional layer of lead generation for even more opportunities. When an agency is doing well, but they want to be doing even better, outsourcing is an easy way to ramp-up lead generation for more aggressive growth. But again, keep your sales cycle in mind. Closed new business can happen at any time, but for many agencies, it is less likely to happen six months out, and more likely to happen 12-18 months out. The better your grasp on your KPIs, the more precise you can be in your expectations.
If you are wondering about realistic expectations for outsourced agency new business, here are some typical outcomes for our clients. While results are influenced by many factors, these are reasonable ballpark expectations:
Some agency new business providers do guarantee a lot of leads or meetings within a certain time frame. However, at the Duval Partnership, we believe that is an invitation for time wasted on unqualified and undesirable leads. Remember, not all new business is good business for your agency!
It’s important to follow a strategic, proven process for better leads from companies you’d actually want as clients. This makes sense to those who believe in the merit of good processes and doing things the right way, but not to those who want something immediately—regardless of quality and long-term value.
Outsourcing agency new business is a proven method of securing agency growth, but it is best thought of as a longer-term investment rather than a source of immediate gratification. It is not a good solution for agency revenue emergencies (read more about the right degree of panic for agency new business success here). Want more information? Contact us here.
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Image credits: seedlings: iStockphoto.com/N-sky; sales cycle: iStockphoto.com/Olivier Le Moal; funnel: iStockphoto.com/micropic; expectations: iStockphoto.com/imtmphoto