The Prospect Opportunity Timeline

Research suggests that only 3% of marketing executives are in the market ready to buy – only 3%. That should have significant implications for advertising agency business development, but too many seem to ignore it. 3% is a tiny percentage of people on any given day. It’s not zero, but very close. Agency leaders too often expect their business development people to shake the trees, dial for dollars, hunt, and capture everything out there right now before any other agency gets it. Given the 3%, that’s a pretty tall order. No wonder business development people turn over so frequently.

If you take the data at face value, very few marketers are actively seeking to hire an agency. There are so few that it is hardly worth the time and investment to pursue. The idea of cold calling to catch random prospects to see if they are in the 3% looking to buy is incredibly ineffective. What ends up happening is more likely not interested or has no answer, so move on to the next. In reality, this old strategy has such a slight chance of success; given the data, it is hardly worth the effort – an effort that could be much more fruitful when tied to the actual dynamics of the market. But then again, we all want new clients right now, so let’s all fight over the 3%. Really?

I’ve already got an agency
If only 3% are active, what about the rest of the marketers? They operate on their own timeline, which is moderated by their business cycles and needs. The majority already have an agency or agencies under contract. Data shows that the average agency-client relationship is about three years. Unless something goes sour in the relationship, the need for a new agency isn’t determined by persistence but by the contract period. Unseating the incumbent is virtually impossible; however, the need for a new agency will come about at some point in time. When it does, you want to be a known and valued resource to the marketer, so between now and then, you should develop a relationship, not selling or spamming but demonstrating value.

I’ve committed my budget
Another significant group of marketers make agency decisions around their company budgeting cycles. They are committed to their current agency for the duration of their annual business plan and determined to achieve their goals and objectives with that agency in hopes of earning their bonus and getting that promotion. They have no interest in talking to other agencies as they execute their plans. But there will come a time when they do, and you want to ensure that you are top of mind when that time comes.

I love my agency
And then there are those who are committed to their agency forever and have no interest in talking to others, end of story. These marketers often bring their agencies with them when they change jobs. Unless something catastrophic occurs in the relationship, these marketers trust their agency partner beyond reproach. These marketers are likely a waste of time, but the brand might not be so. If the senior marketer leaves or gets fired (CMO tenure is around four years), it’s likely that their agency will go, too.

I’m looking for a new job
Not all marketers fit into these categories. Another segment at play is those who get new jobs. According to labor statistics, about 30% are actively seeking a new challenge, which means they are not likely to make any changes at their current company. Between 15% – 20% will change jobs during the year. Of those new hires, about 80% change their agency resources within their first year. I like those odds much better than the 3% who are agency shopping right now. Keeping track of the marketers in your industries and responding to changes is a good way to capitalize on change.

Given these dynamics, agencies that want to grow are better served by both a short and long-term view of the sales pipeline. Of course, if you can identify the 3% in the market now, by all means, have a strategy for them. The rest, the lion’s share of opportunity, is down the road. For example, if you know when a company begins its budget planning, you can spend your time shaping your agency’s perception between now and then. You can demonstrate value while staying top of mind. When the budget cycle concludes, and a new agency search is more likely, you will be on their list or even at the top. If you know when a current agency first signed, you can predict when that contract comes up for renewal and strategically work towards that date, demonstrating creativity and value to compare with the incumbent. If you track new hires, you will know that opportunity may be coming soon and focus on developing a relationship ahead of the search.

The foundation of business development
Establishing a prospect opportunity timeline as the foundation of business development is the most effective way to strategically align new business efforts with the cycles of marketers and markets. This timeline takes time to build as you learn about key dates, contract periods, budgeting cycles, and other significant events. As you build it out and the timeline runs its course, more and more identified and planned agency opportunities will fill your days so that you can spend less and less time trying to make something happen from the 3%. After the first year, you will know of and can forecast better with your timeline, giving you a much more planned and predictable new business funnel. Concentrating your time and resources on the highest potential opportunity you have identified will help improve your success rate. Of course, the prospect opportunity timeline is no silver bullet, but there is a silver lining. Instead of chasing anything that moves, chase the things that matter.

Happy Hunting!
I’ve got some ideas about how you can rethink your business development approach and supercharge your new business program, and I’m happy to share them with you. Schedule a call and lets talk. If you like this post, click the thumbs up, so I’ll know, and then sign up for my new business newsletter. #LetsGrow!